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2021 Shipment Delays and Surcharges

2021 Delays - a shortage of ocean freightliners, truck drivers and freight containers (used to transport on ships and trains) has lead to a major transit delays.  

2021 Price increases - Freight charges have been skyrocketing since late 2019/early 2020 and it's resulted in freight surcharges plus long-term tariff charges are leading to price increases across the board. 

We have received notices from all of our suppliers concerning permanent and temporary increases to our costs and delays due to these issues. 

As we receive new merchandise, we will be adjusting our prices before updating our inventory according to our final costs.  

We will do our best to limit increasing prices for our customers, however many products will see price increases once we know our final charges.

 

Short Summary of causes 

  1. We are now being charge a sur-charge of 3% to 10% of every invoice depending on the supplier due to ocean-freight rates skyrocketing since early 2020 and getting worse.  
  2. Our domestic (within the U.S.) freight charges have increased
  3. Long term tariffs on non-Christmas specific items (example:  fluffy owl figurine.  The December 2020 tariff, which would have included Christmas ornaments, was never enacted however we do carry many items which are not specifically Christmas decor.)

Ocean-Freight Surcharge reasons:  

Containers Shortage:  Ocean freight is placed in metal containers (those big metal containers you see on railroad trains).  With global growth every year the # of containers needed increased. Since late 2019 there has been a shortage of containers due to new containers not being made fast enough to keep up with the importing demands and as a result each month the cost to "reserve" one has increased due to supply & demand.  The shortage increased due to covid-19.    It was hoped the container issue would resolve by late 2020 however that did not happen and the shortage continues.  


Increase in imports:  In 2019 and 2020 US Imports from China increased significantly leading to more containers needed to keep up with demand. 

New containers not made:  By 2019 container manufacturing companies were already not keeping up with demand.  Due to covid-19 new containers were not being made.  (Most containers are made in China).  

Empty Containers:  Not only were new containers not being made, empty containers were not returned to China.  Once restrictions around the world were lifting ships were hauling empty containers and to re-coup that cost of hauling empty containers they had to charge more to "rent" the containers to offset their costs.  

Dock Workers:  By Aug 2020 we were receiving reports of delays of as much as 4 - 6 weeks due to a shortage of dock workers (due to covid-19).  Ships were sitting off the U.S. coast waiting their turn to be unloaded.  Unfortunately, covid-19 seriously impacted dock workers who were essential workers and they often worked despite widespread outbreaks versus shutting down the docs.  As a results there is still a shortage of workers and that is expected to be a long term expected to last into 2022 and beyond.  

All of the above combined means the price wars/bidding to reserve a container skyrocketed, similar to our shortage of houses on the market in the U.S.  The sooner a company needs their goods the more they need to pay to reserve an available container.  Many are reporting paying 600 times more than in 2019 for a single container.  

Search for Google or your favorite search engine for "shortage of shipping containers" for more information and any updates 

 

U.S. (Domestic) freight: 

During 2020 a historic number of truck drivers retired (due to covid-19 and as over the past 2-3 years a huge increase in baby boomers retiring) plus due to covid-19 and a lack of interest, there was a historic decrease in new truck drivers.  (The average age of a truck driver is late 50's).  As a result U.S. trucking companies are paying large bonuses to attack new drivers and hopefully encourage experienced drivers to come out of retirement.  

The result of those costs is freight companies are charging more to deliver goods.  Search Google or other search engines for "shortage of truck drivers" for more information.  

 

Tariffs

So far there has been no change to tariffs during 2021.  U.S. companies pay tariffs (taxes) to our government on all products they import as part of a import penalty.  That increases their costs.  The tariff on home decor items from China increased from 10% to 25% in early 2019.  Many companies delayed increasing their prices hoping it would revert to 10%.  Since that has not yet occurred U.S. importers are increasing their prices to cover most of that 15% increase.  

While most of our products are Christmas specific, and the planned December 2020 tariff increase for that category did not go into effect.

Thankfully for our store, only items as fluffy owl figures which are considered year-round "decor" are affected.  Our suppliers have increased our prices anywhere from 5% to 15% to cover the increased costs of the tariffs.  

Search for "U.S. tariffs on China goods" for more info and updates

Summary

Most companies reported that they hoped all of the above would be resolved by late 2020 however that has not been the case.  The shortages of containers and truck drivers continue and tariffs continue.  Today (6/18/21) we heard from a company which originally was charging us a 4.5% in "temporary" surcharges that they are now increasing that to a 10% increase, and their products may still be arriving later than expected due to the difficulty reserving containers.  

We will do our best to minimize price increases to our customers, however increases will be taking place on new arrivals and are subject to change as we receive our final invoices.