Supply Chain Delays and Shortages

Navigating and Understanding the Paper Shortage

From toilet paper to computer chips, the pandemic has caused many product shortages across the globe. One of the latest shortages beginning to impact everyday life is paper—an integral part of many industries, perhaps most notably the printing industry.

If you work with Graphcom for printing and mailing, you’ve probably had to work with our team to find an alternative to your usual envelopes or choose a different stock or glossy paper for your event invitation card. You’re not alone. Thanks to existing issues made worse by the COVID-19 pandemic, materials are taking longer to produce and ship to their destinations. For us folks in fundraising or marketing, it’s completely disrupted the production and mailing process.

We’re not going to sugarcoat it. Unfortunately, the end to these troubles isn’t in clear sight—but don’t lose hope. You can prepare and adapt your organization to roll with the punches and still carry out successful marketing campaigns. And we’re here to help! But first, some background.

So, what’s going on with the supply chain?

It’s important to understand that no singular part of the supply chain is responsible for this frustrating situation. The current problem is global, not just in the US, and the root cause is found in a variety of unique and untimely events.

—Printers relied on paper delivered just in time. The current problems started years before the pandemic. When Just In Time (JIT) printing became a preferred method for more efficient and cost-effective production, most printers, including Graphcom, decreased their inventory. Instead, paper merchants would store and deliver the paper to us within days or hours of each request.

JIT works when all segments of the supply chain are functioning, but one kink throws the entire chain into disarray. Several kinks in the supply chain are creating the current issues. To mitigate this, we are currently pre-ordering and storing paper at our own warehouse. By making space to hold paper products right here at Graphcom, many of our clients have avoided the headache that comes with realizing your preferred materials are out of stock

—North American paper mills shut down or reduced their capacity. Long before the pandemic, some North American mills shut down, unable to compete with more efficient mills. Some other mills converted to board stock in support of the growing packaging industry. This reduced their capacity, and overseas mills filled a large part of the resulting shortage.

—The COVID-19 pandemic. The pandemic has disrupted the supply chain even further. With closed schools and remote work, the demand for paper fell. More North American mills shut down and others reduced their capacity. Even when COVID-19 cases decreased and restrictions were lifted, the supply chain problems were still there. In fact, we’ve seen some issues grow more obvious.

Without a gradual reopening of businesses, production went from 0 to 100 overnight. Manufacturers blew through their existing inventories. Operations that provide the raw materials and parts needed for print also suffered. They came to a standstill as well, but many of their operations take much longer to ramp up to meet demand. It can take up to six months to get a mill back up and running at full capacity.

—Backed up seaports; not enough shipping containers. Even if goods are produced on time, it’s taking much longer to get them to their destination. Seaports, while improving, continue to be a major problem. Cargo ships are backed up on both sides of the Pacific, making the flow of goods more unpredictable than ever. Certain mills are producing at max capacity but can’t find enough containers to ship their inventory—because the containers are stuck on sea freight waiting to be offloaded.

Final thoughts

We’re in this together. While we can’t control the supply chain or confidently predict the future, we can be flexible, plan ahead, and find creative solutions.