Rising Production Costs of COVID19

We all know this pandemic has caused an international headache for almost every business sector out there. COVID19 has changed a lot of the ways we do life now, including how we do business. We don’t go out to stores anymore to buy goods or groceries or what have you. Instead, we sit on our soft leather couches with our eyes flashing back and forth over our laptop screens. Yes, that’s right, I’m talking about you. The digital age has made it easier and easier to order things online, but with the rise of the virus in 2020, we are seeing unparalleled reliance on online shopping for almost every American in just about every sector of the market. It is really insane what you can buy online these days. Some companies like HelloFresh make it easy to buy groceries for the week online, all put into nice little meal kits with recipes at the ready. Amazon’s promised two-day shipping has taken a back seat as people flock to online ordering like a fat man to red velvet cupcakes. On the bright side, it has created what one might refer to as a ‘hay day’ for some businesses; E-commerce.

Ecommerce has been a rising trend in the last decade or so, but it has spiked brilliantly in recent years. Even more so, e-commerce has emerged as a gladiator in the year of COVID19. Millions of shipping boxes are being sent to every corner of the world as people from thousands of market sectors buy, order, sell, and produce goods online. If someone 200 years ago saw what our technology is capable of doing now, amid such a debilitating pandemic, they may simply explode in disbelief. You can find and purchase just about anything online and expect to receive it in a very reasonable amount of time. It is interesting to make a note of market changes that take place due to such a large outside factor as a pandemic.

One bi-product of increased e-commerce is increased shipping costs. As many are familiar with the laws of supply and demand, we can see that an increase in demand will always lead to an increase in price and supply, all else being relatively equal. We can see now, amidst our wonderful year of the pandemic, that costs of shipping have gone up with the frequency of companies and consumers taking advantage of it. Like I mentioned before, Amazon’s two-day shipping policy is no longer a guarantee; in fact, items from Amazon may now even take weeks to arrive. This is just heartbreaking for your regular American consumer.

We are also seeing unprecedented levels of ordering and purchasing of packing and shipping supplies. Shipping supplies like bubble wrap, packing tape, and other materials are flying out of warehouses at alarmingly fast rates. Shipping boxes are also in high demand, as companies are finding the need for thousands of more containers with which to ship their various products. Overall, this pandemic has been a strange time for our world and for our businesses. It will be interesting to see how much has changed looking back into the years before and how much will continue to change as we hopefully work our way back into as normal of a life we can have with the threat of COVID19.