Supply shortages should ease going into this summer, but the number of product choices from cars to food will remain smaller than before the pandemic, Maine retailers told businesspeople on Wednesday.
The pandemic exacerbated supply chain disruptions that started during the Great Recession in 2007, causing retailers to cut back inventory to items they could sell quickly and to focus more on online sales. The strategies have worked so well that retailers will continue them, permanently altering the shopping experience for Mainers.
The differences are readily seen on car lots. Wally Camp, president of Rowe Auto Group, said his Westbrook and Auburn locations had about 1,000 new vehicles combined on the lots in 2019, but that fell to a little over 100 today. Supply chain issues and parts shortages should improve in the second half of this year, but he still won’t have as large an inventory as in the past.
It has not deterred customers, more of whom are buying cars online. Rowe’s vehicle sales were up 20 percent in 2021 over the previous year, and demand for used cars is high.
“In the future, we’ll have more inventory but it will be less than normal,” Camp told a monthly meeting of the Portland Regional Chamber of Commerce on Wednesday.
That’s the case at supermarkets as well, where instead of eight different types of tomato sauce, there may only be four.
“You still are going to be able to get food and you’re going to be able to eat, but you may not get the variety that you are used to at your various stores,” said Scott Craig, director of network strategy at ADUSA Procurement, which supplies Hannaford and other supermarkets.
He said manufacturers are optimistic about business rebounding in 2022, so he expects product supplies to improve this year. Because of some recent shortages, including canned cat food, the store has had to increase some inventories to ensure it can avoid the big shortages such as toilet paper and sanitizers seen early in the pandemic.
L.L. Bean, which last fall warned that inventory could run low by mid-December, has about 100 suppliers worldwide, but it is focusing on close relationships with the 40 suppliers that provide 80 percent of its inventory to make sure it has the core items it needs, Tim Cahill, vice president of sourcing at the outdoor products retailer, said.
Some 70 percent of the company’s business was online as part of an emphasis on outdoors and comfort during the pandemic. For now, the company is focusing on its core products rather than on new items, partly because of ongoing cost pressures across the supply chain.
That is a problem all retailers are experiencing. A container of items from Asia is taking an average of 113 days to cross the Pacific Ocean and costs three times as much as before the pandemic, Curtis Picard, president and CEO of the Retail Association of Maine, said. There is an upside to that, however.
“The supply chain issues have helped encourage people to shop more locally,” Picard said.