Empty grocery shelves return as sick employees, supply chain delays collide
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Target stores’ bread aisles are nearly empty because of supply chain disruptions that continue in Washington State, U.S.A. January 9, 2022.
Sarah Silbiger | Reuters
Supermarket shelves are empty again as employees get sick, and trucks arrive with full loads of groceries late.
It’s the latest result of the omicron variantThe workforce is being stretched by this. The pressure is being felt by investors who are preparing for longer periods of high labor and transportation costs.
The shares of the major grocery chains, including Albertsons, KrogerAnd Walmart fell Tuesday. Albertsons stock fell by more than 7.7% Tuesday midday after Albertsons discussed the challenges in its supply chain and the high cost of goods it is seeing during the earnings call. The stock fell despite the fact that Albertsons raised its fiscal 2020 forecast. Kroger shares fell by 3% while Walmart lost less than 1%.
Vivek, Albertsons’ CEO, stated that for the past several months the supermarket has suffered from low inventories or the loss of certain items. According to him, the recent spike in Covid cases prolongs some out-of stock situations.
He stated that he expected supply problems to be more solved as we enter this period. Omicron has made a little dent in that. So there are more supply challenges and we would expect more supply challenges over the next four weeks to six weeks.”
Albertsons said more employees are calling in sick due to omicron, which makes it more difficult to replenish store shelves and coolers — even when pallets of food and other items arrive.
New coronavirus version is exacerbating worker shortagesAll industries are affected, including restaurants and retail outlets to airlines. Companies are forced to take tough decisions such as cutting service hours. canceling flightsClose down of stores. This has also been evident in sales figures. LululemonRetailer is one of the ones that has warned about the possibility that Fourth-quarter revenue and earnings will be below estimates. feels the effects of having reduced hours and limited staff.
The challenge for grocers is more apparent because they operate in a low margin business. Companies often don’t have the funds to increase employee wages, compensate overtime workers, or pass additional costs onto customers. There are also shoppers who have less to spend. These are the child tax creditThe program that provided monthly payments to families was called ‘The Arrangements Program. It ended December.
Albertsons executives stated Tuesday that prices have increased for ingredients, transport, and labor. Although the supermarket has seen some of this inflation pass, they said that the price of basic items customers use frequently has been kept low.
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