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Industry Issue: Challenges In 2022
Rising To The As we go into 2022, what challenges will suppliers be facing over the next few months? PG&H asked six leading gift companies for their views.
Below: Peter Smith, Dunoon.
Container Price Issues
Post Brexit Challenges
“The supply chain remains a significant challenge,” says Scott Clarke, head of sales and operations at Rex London. “We adjusted to the longer lead time pretty efficiently by making small changes to our ordering process and have largely been able to keep up with demand. However, when you bring in a new product which proves to be a hit, and you run out before getting a chance to restock, it can be frustrating. Hopefully, as we progress through 2022, we will start to see a move back towards normality on the shipping front, particularly with regards to container prices which are having a major impact on overall costs.” Scott adds that the pandemic is still causing quite a bit of disruption and a seemingly nonstop changing of plans. “One of the trade shows we were planning to attend has been cancelled, and another postponed,” he points out. “Even the ones which are still due to go ahead have an air of uncertainty around them and it’s hard to predict how many people will visit. We hope to see as many customers as possible, but for those who can’t make it we have recently published a new catalogue showcasing our newest and best selling products. After stopping catalogues many years ago, we have found them to be of value once again, allowing us to connect with customers when travelling to shows isn’t an option. It’s all online these days though, so no trees have been cut down!” On a positive note, Scott says that the company expects to return to more normal trading conditions once winter is over, “and we very much hope this will mean a lot more stability for retailers. We could well see more pop-up style gift shops this year as new and existing businesses test demand at key times without having to fully commit to opening new stores. However, inflation and general economic uncertainty are not ideal, especially in the giftware industry, as people will undoubtedly be focusing on their core household expenses. “Nevertheless, we remain reasonably optimistic about the year ahead despite the challenges. With a strong product offering and competitive pricing there is still room for gifting, even in a difficult economy.”
“As a UK manufacturer sourcing from UK suppliers, obtaining raw materials has generally been fine,” confirms Dunoon’s sales director Peter Smith. “We had a period last year when our lithograph supplier experienced delays in obtaining gold colour, which meant we ran close to the wire on supplying patterns containing gold. We also ran tight on packaging materials, but this seems fine now. However, on the Brexit front, it’s not easy exporting to Europe but our shipping department has done a great job thankfully, finding the best way to supply our numerous European customers. Paperwork is immense and costs as a result have increased per shipment.” Looking ahead, Peter says that for 2022, it’s a little too soon to say how the new rules will affect Dunoon. “Now the rules have been relaxed on testing for entry into the UK we have seen an immediate uptake on ordering from our internationally tourist dependent customers. I also think we can expect an influx of overseas tourists this Spring/Summer.”
Above: Scott Clarke, Rex London.
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Progressive Gifts & Home Worldwide
Cost Pressures “Our attitude for 2022 has to be ‘here’s hoping!’” says Gisela Graham’s sales director Piers Croke. “We’ve started the year well, with excellent sales of our brand new designs in our showroom - which opened early in December - with retailers reporting very good Christmas results. But, along with everyone in the gift trade Europewide, we’re facing cost pressures - sevenfold shipping costs from the Far East for a start. Even so, we’re keeping prices as tight as we can to support the trade. We’re experiencing supply chain problems too, with many suppliers specifying six months delivery time. With regards to exports, Brexit made them tricky in 2021, and we are braced for further difficulty in 2022 through additional red tape, especially with Germany where our sales were halved.” As for consumer confidence, Piers says that there’s a bit of a ‘wait and see’ feeling at the moment, which might improve as and when the pandemic recedes. “Pandemic-induced staycations last summer generated some good trade for gift shops and I’m willing to bet that, having rediscovered the joys of a British holiday, people will be coming back in 2022, to the benefit, once again, of the gift trade.” Above: Piers Croke, Gisela Graham.
