A new COVID-19 survey has been sent this morning to manufacturers. Factories in the Lumi Network across US and China are still reporting operational. We will continue to update this page as data comes in. Our recommendations from March 12th still apply.
Recommendations on how to mitigate the ripple effects of COVID-19 on your packaging supply chain are on our blog.
The unpredictable spread of COVID-19 has caused delays across supply chains globally. The impact on packaging for Lumi members so far has been localized in China.
As of this writing, all of the factories in the Lumi network are operational, however some factories in China are experiencing 1-3 week delays as they catch up to the backlog from Lunar New Year and the coronavirus closures.
We surveyed 24 manufacturers in the Lumi network including 12 in the US and 12 in China, between March 5th and 9th 2020, to gather information about how exactly your packaging supply chain is being impacted. Find more details in our webinar recorded earlier today.
Manufacturers in China are taking greater precautions than in the United States. These include all employees wearing face masks, adding more wash stations, cleaning surfaces more frequently, and monitoring body temperature.
Some manufacturers are reporting 5-10% personnel shortages due to quarantine measures, but have stated that this has not affected production capacity.
Air freight costs from China are still high — up to $1/KG increase from end of February to first week of March.
Some of the biggest delays may come from lack of air space, due to flight cancellations. There's also an increase of expedited orders being air freighted out of China to account for delays. This all results in a major cut in cargo space. Order early to avoid air freight and mitigate costs.
All US manufacturers in the Lumi network are operating at full capacity. Prevention among US manufacturers is less strict right now. Only hand washing and safety training were consistently reported.
With the rapidly increasing number of cases, the biggest risk reported by US manufacturers is a personnel shortage.
You’ve no doubt heard about the coronavirus (COVID-19) outbreak in China, specifically the Hubei province. While there are no factories in the Lumi network within the Hubei province, the outbreak could soon prompt factory shutdowns in neighboring provinces that may cause delays.
As of this writing, no lead times have been affected by the outbreak, but should shutdowns continue, you may see delays in order lead times, preproduction sample lead times, and quoting from factories in the these areas.
Before the outbreak, we forecasted shutdowns for Lunar New Year throughout early February. We are keeping in close contact with manufacturers in China and will update you should shutdowns be extended past those dates.