Give differently this holiday season amid supply chain disruptions

Perhaps you wanted to gift your loved one an iPad or surprise your kids with a new Xbox gaming console this year. Or maybe you’re finally ready to reward yourself with a shiny new car this holiday season. Well, you might want to rethink that wish list.

With the current global supply chain disrupted by the COVID-19 pandemic, you’re more likely to find coal in your stockings this year.

Marketing professor Tandy Thomas from Queen’s University’s Smith School of Business suggests two ways to pivot holiday shopping this year.

“First, completely shift away from material products and try to buy experiences,” Thomas said.

Gifts that involve experiences lead to longer satisfaction for consumers because of the social connection that occurs. “Having stuff tends to not make people happy. What makes people happy is being able to share experiences and build meaningful memories with others,” she explained.

This means buying gift cards to eat out at local restaurants or purchasing tickets to art galleries, trampoline parks, spas, or movies. These places, according to Thomas, don’t rely on global supply chains, so there won’t be a shortage of supplies.

Another advantage of “experience gifts” is that they bring people together, which becomes a meaningful gift as it brings more joy and can have lasting memories. It also gives support to service providers in our community who are hardest hit by COVID-19.

“Shift away from the materialism element of the holiday season and think of a way to make this meaningful for our families and our community,” Thomas urged.

“Kingston is a wonderful community. The pandemic has brought up so much good in people. Let’s keep supporting our community, keep supporting those hardest hit by the pandemic, and let’s do everything we can to help as many people as possible during this time.”

“We now have a situation where the supply chain—a very delicate and complex network of operations—isn’t working the way it’s supposed to.”

Queen’s University Prof. Tandy Thomas

The second way to pivot is to build flexibility into your shopping plans. “Normally we have a precise, pre-determined wish list. [Instead], shop from what’s available…go to a local toy store, look and see what’s there, and make your list from what’s available,” Thomas advised.

The silver lining to the supply chain issue, according to Thomas, is that it gives us an opportunity to rethink how we approach gift-giving and to start thinking about ways we can use our purchasing power as consumers to help our local community.

A disruption across different industries

Thomas explained that the current supply chain issue stems from the ramifications of decisions that were made decades ago. The global supply chain was built very efficiently so that products arrive on time: a “slick” system that helps keep costs down.

However, when dealing with a system that’s so efficient, there cannot be any slack. When something gets disrupted at one point in the chain, such as the ship stuck in the Suez Canal, the whole system falls apart.

As a marketing professor specializing in consumer behaviour, Thomas explained that we now have a situation where the supply chain—a very delicate and complex network of operations—isn’t working the way it’s supposed to.

“With the pandemic, in terms of worker shortages and manufacturing facilities and ports being shut down, and this whole confluence of things that have happened around the world, we now have a situation where we’re seeing a lack of supplies of some products and components,” she clarified. “We’re seeing bottlenecks at ports in terms of getting trucks on to roads. We’re seeing a disruption… across different industries.”

Whenever consumers and businesses rely on something coming by boat or from a trucking system, supplies are vulnerable to disruptions. Also compounding the matter is the fact inventories may not be as large as they once were: instead of 20, there will be five items shipped, for example.

“The entire network is disrupted… anything that’s relying on a longer supply chain. The only stuff that’s safe is anything produced locally,” Thomas said.

Thomas is optimistic that things will eventually get better with the supply chain. “I imagine there’s a lot of supply chain scholars working hard to fix the system, [and] a lot of analysis that will be done to figure out which elements in the system need to be reinforced to try and prevent this from happening again,” she shared.

“The silver lining to the supply chain issue is that it gives us an opportunity to rethink how we approach gift giving.”

Queen’s University Prof. Tandy Thomas

“We’re not going to get away from a global supply chain. This is part of our reality. [But] it will eventually get better.”

One way this may happen, Thomas suggested, is for the system to be redesigned so there could be a little slack.

“We are in a once-in-a-century global crisis right now. This is just the next iteration in that story,” she said, explaining that, with the passage of time, we will get through the pandemic, and then go back to a normal life where once in a while there is a disruption—perhaps a shortage of avocados one year.

Those are the kind of disruptions we’re used to, Thomas observed. But If the system is changed to be completely resilient to every possible disruption that could happen, the downside is that the many safeguards built into the system will result in prices of commodities going up because companies are accounting for every possible contingency.

“On the other hand, what’s happening now doesn’t happen too often. There’s a trade-off between ‘Do we protect against the worst case scenario?‘ or ‘Do we do try to make it good enough most of the time?’” Thomas expressed.

“Those intricacies, I will leave up to supply chain experts.”