I am writing this in September 2020, updating the blog in the few minutes I can steal between phone calls, e-mails, text messages and the on going, day-to-day management of our factory here in Harlow, Essex.
To say that work is ‘manic’ at the moment would be an understatement! It’s caused by a very old economic problem – an increase of demand versus a capacity that has decreased the ability to supply. The pandemic has affected all of our lives, to a greater or lesser extent, and the economic fall out is still to be measured. We are seeing huge changes in the packaging industry.
Increased Demand
One of the major factors that has lead to an increase in demand is the massive shift towards online products. With high street stores closed for the best part of three months, and now open with restrictions of their own, sales on the high street are considerably lower than before the virus. The Office for National Statistics (ONS) said that the amount of goods sold fell by 18.1% in April, for example, a decline graphically shown below:
ONS deputy national statistician for economic statistics Jonathan Athow said: “The effects of Covid-19 have contributed to a record monthly fall in retail sales of nearly a fifth.” He added that “online shopping has again surged as people purchased goods from their homes amid lockdown.”
A significant amount of our packaging is used for online sales, specifically ‘hat’ boxes or hamper boxes like the ones below:
This boom in online shopping has resulted in a number of our existing customers ordering considerably more packaging from us as they seek to replace lost high street sales. Additionally we are very happy to say that new customers are approaching us seeking a way to pack their products differently for the online market.
Another factor that is increasing demand has been the extreme uncertainty the business world suffered through April to June
which led to many businesses NOT placing orders overseas, particularly the Far East. This meant that those companies missed the window when such orders could be placed. Consequently, these firms have been forced to look to the UK for their packaging requirements.
All of which is great news for a specialist-packaging manufacturer you’d think? Well….
Decreased Capacity
Unfortunately not entirely.
Despite having adequate premises the space is still limited and what we do is extremely skilled work predominantly done by hand – hand assembly, hand wrapping and hand finishing which requires space for individual staff – space which is now at a premium with the required social distancing and other safe-working practices in place. We can’t just work extra shifts either as we would be spreading our skilled and experienced staff too thin, nor can we take on as many new staff as we might normally do.
At risk of being accused of ‘humbug’ Christmas is on its way – even if it will be a very different Christmas than previous years. Some UK businesses, GWD being one, are not going to be able (at such short notice) to crank up their very specialist production facilities to meet demand, especially when coupled with the restrictions of safe working practices.
Interesting times indeed.
– Noel.
Noel Greenwood is the Managing Director of GWD Ltd, the designers and manufacturers of presentation and promotional packaging. You can reach him on (01279) 416093 or at the company’s website: www.gwd.ltd.uk