The COVID-19 pandemic has brought along many challenges for the supply chain industry. One of the biggest ones was the toilet paper shortage that erupted right as the pandemic emerged in the United States. The toilet paper shortage was the first really widespread challenge that impacted the supply chain industry because of the pandemic. People began to panic-buy toilet paper because of the uncertainty of the pandemic and did not want to risk not having any at home. As people began to rush to the store to hoard toilet paper, suppliers began to worry about how to keep up with the increased demand. Toilet paper sales on March 12th, 2020 were up over 700% from March 12th 2019. This major increase in the demand not only made suppliers wonder how to keep production up with the new demand, but more importantly, how to get the product to the stores to keep up with the demand.
Suppliers are still uncovering and learning about new challenges brought on by the COVID pandemic. The restrictions put in place as well as the reduced work force has affected the ability for the suppliers to maintain production levels. These restrictions such as social distancing and going virtual have made it harder for companies to continue their operations as they normally would have. It also set these companies back while they had to take time to adjust to the new rules. Logistics have also been disrupted by the pandemic, as finding space to ship products has been difficult. There is also a shortage of truck drivers, which has made it even more challenging to find space in an already crowded market. This shortage was heightened by the pandemic, as demand for drivers went up but the supply went down. Many drivers decided to retire early due to COVID restrictions and shuttering infrastructure. This was one of the main problems in the toilet paper shortage because suppliers could not find enough room on trucks to keep up with the consumer demand at these stores. Another challenge was brought on by companies having a global supply chain. During the pandemic, different restrictions have been in place in different cities, states, and countries. This creates a major dilemma for suppliers, as some operations in the supply chain will be affected at different time, creating a headache for companies to put all of them together to make the processes work.
For toilet paper suppliers in the United States, the pandemic quickly brought along a challenge that these companies were not prepared for, such as keeping production levels up at these factories due to COVID-19 protocols and the possible loss of workers. Some factories including a Proctor & Gamble toilet paper production facility in Green Bay, Wisconsin began to use desk workers on the production floor to keep up production supply with consumer demand. While not ideal and still challenging, this aspect was not the biggest problem for suppliers. The biggest issue was getting the product out and to the stores. Toilet paper shipments take up a lot of space on trucks in order to send out for delivery. They are sent out on large pallets, however, toilet paper is not the most valuable product, so these shipments are usually only sent out when there is a full truckload. The problem with that is that when sales shoot up 700%, the demand for toilet paper increases enough that stores need truckloads every single day. While challenging to produce enough to keep up with this demand over time, it is even harder for logistics to find enough transportation to maintain shipments to keep up with this demand. Zac Rogers, a SCM professor at Colorado State, says that “companies wait until they have full truckloads, which may mean they send out 2-3 trucks a week instead of 1 everyday.” This is because it is not cost efficient to these companies to send out truckloads when they are not full.
The COVID-19 pandemic has affected supply chain operations throughout the country. The first widespread challenge was the toilet paper shortage. This was caused by panic-buying consumers. Suppliers’ supply chains were greatly challenged and impacted by this, both in keeping up with production and getting the product (toilet paper) to the stores and on the shelves. Not being prepared for a situation like this was detrimental to the suppliers. This situation will force companies to look at the entire supply chain process (manufacturing, procurement, logistics) and find out how to improve them or prepare for a situation like the pandemic. Not being able to keep up to consumer demand is one of the nightmare situations for supply chains, and the toilet paper shortage is one of the examples that will force companies to improve and prepare for any situation thrown their way.
Authored by: Evan Babka