Paper Shortages & How to Best Minimize the Disruption

We all remember (some of us a little too vividly) the toilet paper shortage of 2020.  If you’ve visited any DIY home improvement store recently, you may have noticed that the price for the materials you were shopping for have majorly increased.  Besides sticker shock, you may have noticed fewer materials stocked on the shelves or longer than normal delivery times for appliances and other installations; or worse, you can’t get them until “further notice.”

As we all know, the COVID pandemic has wreaked havoc on supply chains on a global scale. Unfortunately, many goods and raw materials have been affected; paper being one of them.

We’ve gone ahead and summarized some of the major contributing factors to the paper shortages and increased costs for materials that you may be experiencing.  Most importantly, we included some things that you can do when planning a print project to minimize disruptions in production.

Freight & Transportation

Much like the rest of the country, freight costs have continued to increase since the pandemic.  This is due to changes in spending habits caused by COVID-19.  People’s spending has shifted from restaurants and entertainment to consumer goods purchases (that they can have delivered and use at home).  The increased or steady demand for consumer goods, has created strain on global supply chains.

Congestion at the ports and across the oceans has caused longer than usual delivery times, making it difficult for suppliers to maintain normal levels of inventory.  The regular excess capacity that would typically be available to help offset increased demand, is being utilized at full capacity, thus there is no overage option to help relieve the increased demands.

Trucking availability is low due to increased demand for deliveries, not to mention the prices of oil creeping back up since the pandemic.  All of these have contributed to exponentially higher freight and shipping costs across the board.

Wood Products

The demand for wood products has grown (due largely by the spike in home renovations and building brought on by the pandemic).  Combine that increased demand with the domino effects of the freight delays, resulting in higher costs and longer lead times for obtaining the materials to make paper.

Keep in mind, when COVID first hit in 2020, demand for paper decreased significantly.  Not only that, but slowly lessening print and direct mail volumes due to the digital revolution started prior to 2020.  As such, paper mills had adjusted to decreased demands and altered production by closing mills or converting mills from commercial printing paper grades to corrugated in response to the shift in home delivery buying habits.

However, now that demand for these materials has been increasing, the mills are struggling to get the raw materials (and employees) they need to ramp up.  As a result, paper mills and distributors have been limiting orders and have sometimes not been able to fulfill paper requests.

Workers

The US Labor Shortage is a problem that virtually all industries are facing right now.  The COVID pandemic contributed to multiple factors, mainly personal health fears, childcare issues as virtual learning replaced in-classroom learning, and inadvertent worker disincentives from governmental stimulus packages.  Company’s cost to rehire and replace the workers shed to survive the COVID economy has resulted in the hiring of less qualified workers at significantly higher costs.

Increased Prices

Increased demand, decreased supply, and heightened costs for freight, raw materials, and workers are all contributing to increased pricing.  We’re noticing multiple price increase announcements from our paper suppliers to recover the losses they’re experiencing due to the increased costs they’re incurring.

So… What Now?

While these conditions aren’t ideal, we do have a few suggestions for ways to minimize the effects of the paper shortage.

1) Give Advance Notice – If possible, inform us as early as possible about your upcoming needs, and the types of paper your future jobs require. We’ll do our part to secure the stock as quickly as possible.

2) Build Time into the Schedule – Given that lead times are changing overnight, it’s best to build in additional time for production to help cushion any delays that may occur. Adding a few weeks into your plan will help keep your project on time.

3) Be Open to Substitutions – We’ve been able to get most of the stock selections that our customers require. If we are not able to secure the exact paper you requested, we will recommend suitable substitutes that may be more readily available.

As fluid as this environment is, at ANRO, we’re doing everything in our power to proactively manage these challenges.  Fortunately, ANRO is financially rock-solid, and our prompt payment ability helps us leverage our relationships with our paper suppliers. We will remain nimble and adapt as we continue to navigate the situation and ensure open communication as we go.