Marine overload 29/12/20
Dear partner.
2020 was a year rich in emotion and twists and turns.
Fortunately, this event portends good things for e-commerce and for the sale of furniture .
The advent of teleworking and the repeated lockdowns made us realize that we had to feel good in our accommodation.
The whole world has therefore invested simultaneously in the development of its habitat and it is not ready to stop.
But there was a downside to this coin.
Some of our partner factories are located in Asia where the Covid 19 virus appeared at the end of 2019. A total lockdown was decreed there at the beginning of 2020 for a period of +- 3 months, resulting in the closure of almost all manufacturing plants. They gradually reopened at the beginning of April and took time to recover their full production capacity (stock of empty raw materials, return of labour, etc.).
The catch-up of the months of closures, combined with the explosion in global demand for household equipment, resulted in an exceptional production volume at the end of 2020. This production having to be transported, it created an equally exceptional demand on maritime transport, which no longer had its full capacity (fewer boats and fewer empty containers).
As a result, we have been witnessing for several weeks a dizzying rise in maritime transport costs (+320% in 3 weeks).
As you will have understood, the global furniture market has been greatly disrupted and most of the components of the value chain are impacted: Deadlines, transport costs, production costs, etc.
Here is a brief summary of the situation:
- Up to 100% increase in production times
- Explosion of shipping costs
- Not enough empty containers in Asia
- Congestion in all international ports on the Asia-Europe and Asia-USA lines
- Extended administrative processing time (customs clearance, transport, etc.)
As import costs have skyrocketed, some retailers have already hiked up their selling prices by 30%. The situation is exceptional, unpredictable and it is impossible to determine how long this will last.
At Kokoon Design, we made the decision to wait.
It goes against our vision to impose a sudden price increase on you and in full preparation for the winter sales which will be a milestone for the start of your year 2021.
Our rates will therefore not change in January. However, exceptionally, we will not be able to make a promotional discount during this period.
Kokoon Design has and will always want to build and maintain a relationship of trust with its partners .
This is why we communicate with you in complete transparency and will keep you informed of the evolution of the situation.
A reassessment will be made within 2 weeks and it is possible that a (temporary) increase will be implemented.
The whole Kokoon Design team wishes you a good end of the year and success in the start of 2021.
