THE CEO’s BLOG
This is an excerpt of the letter I sent out yesterday to our customers. I am sure you have received many letters from CEO’s of major corporations. Bottom line: Everyone is telling the same message: Stay safe, wash your hands, social distance and get through this. As Larry David would say, “I guess people didn’t stay safe and wash their hands before this crisis.”
Each day we are living in unprecedented times with an unpredictable future. This reminds me of a recent book I read, The Pioneers by David McCullough. McCullough tells the story on how a few heroic pioneers decided to leave the safety of the thirteen colonies in 1788 and head west to explore and develop new parts of America. The area he focused on was Ohio and you learn how Columbus, Cincinnati and the Ohio River became crucial to the rest of America being developed.
What you really learn about were the hardships these pioneers faced from clearing land, to finding food and shelter, to walking thousands of miles with horses and limited supplies to get to Ohio. Many died in their efforts but their efforts and deaths helped to make America what it is today.
America is not short on stories like this one. There are numerous events in our short history that have brought us down to our knees from the Civil War, World Wars I & II, the great depression, the oil embargo of 1973, and most recently, 9/11/2001 and the 2008 financial bust. In every instance, America has emerged stronger and better. This time around will be no different.
However right now we are in the moment and have to do the best we can. In my past 35 years, I have never witnessed supply chain issues like we are having now. If Amazon who has more than 175 distribution centers is out of stock of key items, then you know the rest of the story.
With the exception of gloves and masks, virtually all items in demand are made in the U.S.A. The problem is with consolidation over the past twenty years, there are typically no more than three companies that manufacture more than 80% of the products. So while Procter & Gamble is running their factories full time to make Bounty and Charmin, they are limited to factory production just as Kimberly Clark and Georgia Pacific. Same with hand sanitizer, Clorox makes more than 80% through its Purell brand and can only make so much.
Then the question becomes, which of their customers get goods first? Is it Walmart, Amazon, Kroger, Costco or ???? What about the independent stores? The dollar stores? The government? Commercial and industrial?
Our factories are running full time too. But what happens when a factory has a worker infected with the virus? The factory has to shut down. This has happened to many factories, including bottle companies and silk-screen printers. In times like this, you do what you have to do.
The other issue is raw materials that make things like alcohol, soap and cleaners are in short supply and manufacturers of these materials are raising prices daily. We have experienced many price increases and we are trying our best to hold prices.
We have deliveries of MULTI-CIDE and CITRUS-CIDE arriving weekly along with shipments of gloves from China. Another item that is selling out is foil sheets.
In closing, staying safe and healthy is everyone’s primary focus. Our industry is resilient and we need to take a leadership position no different than the healthcare industry in maintaining the strictest guidelines for cleanliness. THE INDUSTRY SOURCE is your partner in making this happen. Feel free to email me anytime at firstname.lastname@example.org.
©2019 Larry Gaynor. All rights reserved.