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Chinese New Year – The impact of Chinese New Year on your supply chain

 

 Chinese New Year Celebrations

Whilst focus in recent weeks has been upon Christmas and New Year celebrations, there is another seasonal festivity which can have a huge impact upon your supply chain that you should certainly be taking into consideration around this time of year if you conduct business with Asia.

If your business is involved in sourcing goods from Asia, whether that be components for manufacturing, or consumer items, or you are involved in the export of goods to China, it is important to be aware the affect Chinese New Year can have on the delivery of these goods.

Festivities for Chinese New Year 2019 – The year of the pig, will begin on the 5 February and last up to 2 weeks. During this time, shippers are strained to find available space on container vessels out of Asia and typically must pay considerable increases in freight rates to secure available spaces on any sailings. It is not only during the celebrations that there is an effect on transportation arrangements into and out of China. The impact upon supply chain transportation can be begin to be felt a couple of weeks before and extend well beyond the Chinese New Year celebrations as companies attempt to deal with the backlog.

If you are able to manufacture and ship stock across to the UK in advance of requirements, storing products in a customs bonded warehouse enables you to defer the payment of tax and VAT until the products are required, ensuring the effect of the holiday period has minimal effect on your product.

If you have not pre-planned your shipments in advance, it may be necessary to consider alternative transportation methods for urgent shipments. For example, air freight instead of ocean freight.

To discuss your supply chain requirements throughout Chinese New Year and beyond, contact us on +44 (0)1376 505160 or email info@velta.co.uk