Coronavirus leads retailers to scrap travel plans
HIGH POINT — Even before three domestic airlines suspended all flights to China and the State Department warned against traveling there, some U.S. furniture retailers were postponing trips to the country and bracing for product flow disruptions in the wake of the coronavirus outbreak.
Industry tradeshows in China previously slated for March, have been postponed. But it's more than this that has some retailers wondering how quickly business with the country will return back to normal. It's the virus setback on top of the usual disruptions that come with getting workers back on track following the Chinese New Year that's becoming the issue.
At Englewood, Colo.-based American Furniture Warehouse, Fran Coleman and a co-buyer were in the midst of scheduling their trips overseas when the outbreak gained steam. According to national reports this morning, more than 17,000 people in at least 23 countries have been infected, and more than 360 people have died, all but one death occurring in China.
Coleman, buyer and merchandise manager, knew the March shows in Guangzhou were postponed, but since AFW normally doesn't attend them, anyway, that wasn't really the problem. It's more of a logistics issue. When the retailer does travel overseas, it makes the most out of them with stays in China, Vietnam and Malaysia. This time, the plan was to leave Denver March 4, and “our first stop was going to be in China,” in the Anji County area of Shanghai.
“Right now, we decided to put our plans on hold until we see exactly what's going to happen,” he said. “I think everybody is going to have a concern about product flows especially out of China,” but he added the disruption could extend beyond that country into the other countries he typically visits.
“It’ hard to get all the workers back after Chinese New Year to start with,” he said. Add the coronavirus concerns into the mix, and “maybe it's going to affect many factories over there that supply the full chain. There have got to be parts coming from China that go down to Vietnam and Malaysia to manufacturer product, so … they could be affected by that, too.”
Coleman believes once workers do come back from the extended holiday period, initial orders will be fulfilled, but he’s concerned “there could be some delay in future orders, that it will just escalate,” he said.
City Furniture was planning to attend the CIFF show but “can’t risk it now” and has halted all travel to China,” said Andrew Koenig, president of the Tamarac, Fla.-based retailer. “Safety first,” he said. “We’re in constant contact with our suppliers monitoring our existing products flowing as well as our new projects. Sending our prayers to all those affected.”
Miami-based El Dorado Furniture has heard from several suppliers, advising that they have extended Chinese New Year for at least one additional week “to accommodate for the quarantines,” said Jesús Capó, vice-president and chief information officer.
“It will affect some of our flow since we try to work with as much just-in-time merchandising as possible,” he said. “Only time will tell how long this will affect the industry.”
El Dorado wasn’t planning to attend the Chinese furniture shows this year because of time restraints, Capó said. When that's the case, it typically will make up for it with trips to visit certain manufacturers. But it hasn’t had to scrap travel because those plans are for much later in the year, he said.
“As far as other interruptions, we hope this is the only blip this year, although it's still very early in the year,” he said. “I just returned from the Vegas market, and the topic of discussion was the virus, where it used to be Vietnam, tariffs, etc. There were hand sanitizers everywhere.”
Capó said one odd offshoot of the coronavirus talks that came up a few times was whether or not animal products — such as leather hides — coming from China “may have a stigma of having been exposed to the coronavirus,” and whether China would have to offer some sort of certification or guarantee the product was “virus-free” to maintain consumer confidence.
Asked how the virus outbreak may be impacting Rooms To Go, CEO Jeff Seaman said no one from RTG was slated to travel to China. “We have a team that lives there, but other than that, no travel,” he said. “Hard to know if it's going to disrupt production flow, but my guess would be, yes.”
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