Chinese New Year can have a huge impact on your business’ supply chain. This can include longer transit times, flight cancellations and blank sailings which can all have a significant impact on the global freight market for weeks before, during and after the Chinese New Year period.
This article will help your business prepare for the upcoming Chinese New Year so that your supply chain is not adversely affected, and ensure your goods arrive when you need them.
When is Chinese New Year 2023?
This year, Chinese New Year will fall on 22nd January 2023, and runs for 16 days until 5th February. As part of the celebration, a seven-day public holiday will be held between 22nd January and 29th January.
Although the celebrations only last a week, some factories in China may close 2-4 weeks before Chinese New Year, which can delay production and therefore the shipping of goods.
How will Chinese New Year affect the supply chain?
Factory closures
Many factories in China will be closed for at least a week over Chinese New Year. Workers may take time off from mid-January which will result in delays to your products. You may also not be able to get hold of your suppliers during this time.
Reduced quality
As a result of the closures, workers may speed up production lines before and after Chinese New Year to meet demand. This may have a negative impact on the quality of products. It is important to ensure that all goods are carefully quality controlled, both for deliveries that take place shortly before, or immediately after the Chinese New Year.
Port congestion
There is likely to be a lot of port congestion from the beginning of January, and this is likely to continue potentially into March.
Blank Sailings
A blank sailing (a void sailing) is a sailing that has been cancelled by the carrier. This will undoubtedly occur over Chinese New Year as there is less demand for shipping due to the factory closures, so carriers will adjust their schedule accordingly.
Tips to prepare your supply chain for Chinese New Year
Book ahead and plan early
Plan your logistics well ahead of time and be prepared for delays and disruption to last up until the spring. Businesses are advised to have a buffer inventory ahead of time to compensate for the supply chain disruption.
Communicate with suppliers
Get in contact with your suppliers in China in early January to find out their closing dates so you can adjust your inventory and transport plan accordingly.
Be flexible
There may be changes to routes and transport modes which can impact the cost of shipment so be prepared to be flexible.
Work with a good logistics partner
Finally, working with a good logistics partner will enable you to plan ahead and prepare your business with a schedule that takes into account closures and delays caused by Chinese New Year. They can also advise on splitting cargo or booking with different carriers to minimise blank sailings and delays to your supply chain.
We encourage all our customers to reach out to us so we can help you navigate any uncertainty and provide the best alternatives for your business.