Supply problems hurt small businesses

(Toronto) Supply issues are increasingly complicating the existence of small businesses in this country.

Not only do they have to contend with a labor shortage, small businesses also face a number of supply issues: semiconductor shortages, rising shipping costs, delays in ports and flooding in British Columbia. They don’t have the money to get by.

This trouble couldn’t come at a worse time. With the holiday season quickly approaching, delivery delays and empty shelves can be disastrous during the busiest time of year for many businesses.

Several businesses were counting on the Holidays to relaunch themselves after several months of the pandemic. Some even hoped to take advantage of it to avoid bankruptcy.

” It’s a question of survival ! Says Helmi Ansari, the owner of a company that manufactures espresso machines and stainless steel bottles.

Supply problems prompted him to apply for a first bank loan, 15 years after the founding of his company.

“There are people who depend on us to put food on their tables. We have to make sure that my business survives, but without inventory, I will have to lay off employees. ”

Mr. Ansari resisted the idea of ​​raising the price of his products. He says he knows other companies that have had to do it because the demand for supplies has never been greater. Several delivery companies take the opportunity to increase their prices. In some cases, these have even tripled.

The Drewry World Container Index shows that the cost of transporting a 40-foot container from Rotterdam to New York hit US $ 6,214 in early December, a 208% increase from last year. The Shanghai-Rotterdam route is even more expensive as the price has jumped to $ 13,500, an increase of 283% in one year.

Inflation steps in. According to Statistics Canada, the annualized inflation rate rose to 4.7% last month, the largest increase since February 2003.

Food saw an average increase of 4% last month.

“Meat jumped to two dollars a pound as it increased, according to my co-packer, the increase was usually 25 cents,” says Lola Adeyemi, founder of “It’s Souper,” a Toronto-based soup company. afrofusion ”.

It explains having had to increase its prices to cope with inflation and the labor shortage that has affected the activities of the factory that manufactures its new sauce line.

M^me Adeyemi had no choice but to rent a kitchen, store her supplies, and ask friends to help her prepare and bottle piri-piri and green chili sauces.

“I still don’t know if I would be able to produce through a manufacturer or if I should continue to prepare them myself,” she wonders.

Companies were choosing foreign products before the pandemic because of lower costs. But prices have risen so much that companies aren’t saving as much as they used to, says David Yeaman, president of Molded Precision Components, which is looking to relocate production.

Myriam Maguire, one of the founders of Maguire Boutique in Montreal, understands the situation.

She had to create waiting lists for items after many European factories closed during the pandemic. If these factories have reopened, the same problem is hanging over the Asian market.

The delivery of its handcrafted $ 300 combat boots to Florence, Italy was delayed four times because its supplier was unable to secure an imported product from China.

“Even though they’re made in Italy, the main chemical component comes from China. Today, China keeps everything it can to itself, so my manufacturer is going through difficult times, ”says M^me Maguire.

She has to bring her products by plane, do pre-sales and get her customers used to being patient. About 300 people are on the waiting list for combat boots. M^me Maguire says he has not received any complaints on this subject.

“Since the start of the pandemic, people have ordered stuff from Amazon that gets delivered to them a month or two later. People are used to these delays, she adds. The fact that they are more patient really helps small businesses. ”