Staving off supply chain issues
Published Jul 8, 2022 at 12:00 pm on WDEL
Supply chain disruptions have forced many small businesses to think outside the box, especially in situations where they can't get the boxes to ship products.
On Wednesday, July 6, 2022, Congresswoman Lisa Blunt Rochester visited a pair of Smyrna based businesses to discuss supply chain issues and what's being done at the federal level to improve the situation.
Blunt Rochester stopped by family-owned Willis Chevrolet where a vehicle inventory shortage is the result of the ongoing lack of availability of semiconductor chips. The service department is also having difficulty getting auto glass to replace damaged windows.
Not far away, Painted Stave isn't having trouble making product, but packaging it has become a problem because of skyrocketing costs of bottles and boxes.
Painted Stave co-owner Mark Rasmussen said distillers have different distribution standards than do brewers.
"For us every drop of it that comes forward has to come out in a bottle that the label shave been approved and it meets certain specifications from the federal government, "said Rasmussen. "That means that if you don't have that packaging available you have no other way to bring that to market."
There was already a premium on spirit bottles because they use thicker glass.
"The specifications for spirits bottles tend to make those bottles significantly more expensive on the order of twice to sometimes three times the cost of your average wine bottle," said Rasmussen who adds that the cost of those thicker bottles has shot up. "We've seen anywhere between a 30 and 80 percent increase cost per bottle."
And if the cost of the bottles wasn't bad enough, there's a scarcity of boxes.
"So where you used to be able to have maybe a minimum order of $5,000, we've seen in at least one instance the minimum order went to up $70,000," said Rasmussen. "Twenty years of boxes that I would have to buy and store."
Blunt Rochester is a member of the conference committee working to reconcile the America COMPETES Act passed by the U.S. House of Representatives, and the United States Innovation and Competition Act which was approved on the Senate side. She is one of the sponsors of a piece of the legislation focusing on supply chain resiliency.
Blunt Rochester is hopeful the committee can come to consensus prior to Congress' August break.