Woolworths shoppers may start seeing ‘stock gaps’ in the next two weeks due to coronavirus chaos
Coronavirus-related disruption to Chinese manufacturing and exports is expected to have an impact on Woolworths in the next two weeks. The retailer has warned that some imported items may not be available as it prepares to stock clothing and other products for the winter season.
“Whilst we have not seen any immediate direct impact on our South African business, we anticipate that the extended Chinese New Year will create stock gaps in certain categories from mid-March onwards,” a Woolworths spokesperson told Business Insider South Africa. Shoprite warned this week that it is at risk of losing R100 million in sales as the coronavirus disrupted imports of mainly heaters and blankets.
The coronavirus has wreaked havoc on Chinese manufacturing, which has now been severely disrupted for more than a month.
Manufacturing at Chinese factories has stalled since the start of the Chinese New Year, on 25 January. While the factories were supposed to only be closed for four days for the national holiday, government ordered factories to remain shut for the next two weeks as the outbreak of the coronavirus intensified.
Government then ordered all factories to open again on 10 February, but manufacturing has not returned to full capacity as many Chinese workers choose to stay home to avoid infection, as the death toll in China reaches 2,700. Apple and other international companies have warned that the manufacturing disruption is hitting product supplies.
The disruption caused in the shipping container industry has been unprecedented, and Woolworths says it has switched to air freight for some products to help speed up delivery, and it is also fast-tracking imports from unaffected regions, the spokesperson said.
Shoprite is now sourcing products from countries like Bangladesh, Ukraine and India.
Some 16% of South Africa’s imports come from China – it’s by far South Africa’s biggest trading partner. China is SA’s biggest export destination, taking 11% of all of SA’s exports, while it is also the biggest source of imports for South Africa.