Retailers are already preparing for the Christmas rush

By: Trademagazin Date: 2024. 06. 26. 10:14

Although Christmas is still a long way off, retailers have already started intensively dealing with the end-of-the-year season at the beginning of June. Due to global geopolitical tensions and challenges in supply chains, commercial businesses have started securing Christmas supplies earlier.

The conflict between Iran-backed Hamas and Israel erupted last October, further complicating the situation in the already unstable Middle East region. The Houthis, who are also backed by Iran, have regularly attacked the supply ships of Western companies in recent months, particularly in the Red Sea and the Gulf of Aden. As a result, most container ships now prefer to avoid Africa, which significantly lengthens routes and increases costs.

This situation has significant implications for transportation costs and inventory strategies. Container prices reached their peak in January this year, and after a short decrease, they started to rise again in May. In the first week of June, shipping costs for 40-foot containers exceeded $4,000, a 140 percent increase from a year earlier. Due to the lack of containers and high shipping fees, traders have taken heart, as these factors have a significant impact on inventory and prices.