In an article published almost exactly a year ago, my colleague Chris Ruvo wrote ASI’s first words on COVID-19: “The 2019 Novel Coronavirus, which has infected thousands and claimed the lives of more than 100 people, is causing disruption in the North American promotional products industry.”

Most of us had no idea what was coming next. Distributors and suppliers spent the rest of 2020 battling plummeting sales, transformed workplaces and constant uncertainty.

In the end, according to just-released ASI data, industry numbers by the conclusion of 2020 were nearly 20% down from a year previous. Distributors’ quick pivot to PPE and hard-won business through creative ideas and smartly packaged kits saved the industry from a worse fate. Suppliers, meanwhile, kept their doors open and lines humming, striving to deliver for distributors while being plagued by ongoing disruption due to supply chain delays, lack of inventory and personnel shortages. These problems persist as the pandemic drags on.

Early in the pandemic, there were countless stories of suppliers and distributors banding together to help each other as well as others in need. Suppliers also report that distributors were generally understanding of their supply chain challenges, realizing that many of these issues were out of suppliers’ control, while suppliers did their best to maintain communication with distributors.

I would have thought that, having been through the fire together, the bond between suppliers and distributors would be stronger than ever. That’s not the case anymore.

Patience Wears Thin
Right now, everyone’s fed up and patience has worn thin. A Q4 plagued by significant delivery delays due to overextended freight and mail service companies was the final straw. Distributors have had it, and they’re taking it out on suppliers.

“The kindness and understanding that our distributor customers once showed in the early stages of the pandemic have gone to the wayside,” a supplier told a senior member of ASI’s sales team. (This supplier, like others who agreed to speak with me on this contentious topic, wished to remain anonymous.) “We’re dealing with many challenges, and we’re faced daily with very rude and nasty customers who’ve forgotten that we’re still in a pandemic and we’re doing the best we can.” The supplier went on to say that, as clear as they’ve tried to be in explaining extended lead times, distributors haven’t heeded the information. “I can’t tell you how ashamed I am at my industry at the moment,” says the supplier.

Laurie Woodruff Jackson, president of Woody’z (asi/98175), in Santa Ana, CA, a state hard-hit by COVID, says that sometimes distributors call with a combative mindset. “We chalk it up to the overall extensive issues with COVID and politics, which are enough to make anyone a little tense,” she says. “But they should remember that the virus is raging here and none of us want it. All the hospitals are full and it’s a scary mess. Also, 99% of our end-users are food service establishments, so our revenue’s very thin and we don’t have as much inventory on hand as usual. We ask that they try to get as much lead time from their customers as possible.”

In a recent letter to distributor clients of Top 40 supplier Polyconcept North America (PCNA, asi/78897), David Nicholson, vice chairman of Polyconcept (parent company of PCNA) reiterated his gratitude to customers for sticking with them during a tough year, as well as the reality of what his company is facing.

“From shifting category demand to inbound shipping delays, our approach to inventory and capacity planning has had to account for substantial uncertainty in the market,” he writes. He adds that the company has “made significant investments” in inventory of its most popular products to mitigate delays, which he says will continue this year.

“We have returned to operating with standard lead times for Leed’s, Bullet, Journalbooks and ETS, while decorated orders for Trimark are temporarily subject to extended lead times,” he writes. “As I mentioned, we are actively working to increase capacity for apparel decoration, and we will provide updates over the next several weeks.”

Communication Breakdown
When asked about the general loss of patience with suppliers, distributors say suppliers aren’t communicating with them in a timely manner. One distributor executive in the Northeastern U.S. says he and his team are understanding about delays and disruptions. It’s when the supplier isn’t clear about the situation, changes the story or – at worst – says nothing, despite multiple voicemails and emails, that they run out of patience.

“If there are issues, we can deal with it,” he says. “What drives people crazy is the way suppliers fail to communicate. You don’t hear anything, or they say, ‘There’s nothing I can do,’ or the item doesn’t arrive in time and you get a message that says, ‘Sorry about missing the delivery date today – the new one now is in two weeks.’”

The distributor says that not having any type of answer for the end-buyer keeps the customer hanging and comes across as a lack of integrity and honesty. “There are options – give me options by giving me clarity,” he says. “Maybe the truth is that it didn’t leave China in time. Just tell me that. Reach out to me.”

A distributor executive on the West Coast is having similar challenges. He says the management team at his company continues to impress on its employees and sales reps the importance of showing kindness and understanding in the face of the myriad stressors of the times. But the lack of communication from suppliers has been worse than expected; it’s especially disappointing after many years of positive synergy.

“Until last year, I always raved about how our industry does an amazing job,” he says. “That hasn’t been the case during COVID. Ship dates are often missed, it’s difficult to reach someone, product is out of stock and the overall service from suppliers has been much worse than what we had expected and the historical norm. I do feel for suppliers dealing with shutdowns, a different product mix, way more drop-shipping and financial strain, but from our user point-of-view, performance has suffered and people take it out on the CSRs, though that doesn’t make it correct.”

More Supply Chain Woes
Restoring the consistency of the supply chain would easily solve these tensions, but that doesn’t appear likely any time soon. In fact, it seems supply chain distress is worsening. In our report last week, suppliers say they’re already experiencing another wave of supply chain challenges, including increased costs in shipping containers and raw materials, along with reduced shipping capacity and lack of space at ports to allow for unloading of containers.

“Containers are taking longer to unload at port of entry,” Cheron Coleman, VP of global supply chain for Top 40 supplier alphabroder (asi/34063) told ASI Executive Editor Christopher Ruvo. “Then they’re taking longer to get to their final consignee destinations due to domestic rail and long-haul shortages, and they’re taking longer to unload at consignee warehouses due to warehouse labor issues. Finally, empty containers are taking longer to get back to the ports to head back to origin.”

Not to mention Chinese New Year on Feb. 12, which causes days of supply chain disruption in a normal year. “That’s a whole other level of frustration,” says the distributor in the Northeast.

Meanwhile, unlike the large majority of distributors who have been able to work in the comfort of their home offices, suppliers are dealing with the headaches of keeping their offices and facilities open. By nature of their business, suppliers usually require that people be on-site, especially in warehouse and production facilities. When those workers come down with COVID, or are even just exposed to it and have to quarantine, that loss in personnel inevitably causes communication and production delays.

On Monday, Jan. 25, ASI was made aware of three suppliers on both coasts who were continuing to try to operate while between 25 and 30 workers at each location stayed home in quarantine. Midwestern suppliers have reported the same in recent days.

To compound the issue, suppliers say they’re often given very limited and confusing information. Annette Eising, sales manager at Conimar Custom (asi/72795) in Ocala, FL, says even though her company has worked hard to ship orders on time, the delivery companies continue to blame the pandemic for delays. She says one order was shipped on December 18 by FedEx Freight to arrive before Christmas. Nearly a month later, the order still hadn’t arrived.

“The shipping company just keeps giving me excuses,” she says. “The distributor has become irate and verbally abusive. In this kind of situation, all you can do is refund the entire order and take a loss.”

When she asked about another order to be delivered by FedEx, Eising received this reply from the freight company: “This particular third party has been helping FedEx with backlogged freight due to COVID and holiday peak volume. They’re trying to deliver this today, but definitely by tomorrow.”

“I have no idea who this third party is,” she says. “I understood the weather delays when it first left, but this is now just shy of being 30 days since it shipped.”

As supplier CSRs deal with irate distributors, they’re also concerned about bad ratings on supplier sites like ESP. “It seems like everyone’s over the pandemic, which we’d like to be as well,” says the supplier who reached out to an ASI sales exec. “However, we do have employees with COVID who aren’t doing well. We’re almost out of the woods, but not yet. It’s just so upsetting. I think a reminder to be kind is still needed even though the calendar flipped to 2021. This hasn’t magically gone away.”

Another distributor on the West Coast says it’s more important than ever that everyone know what promises they can make and what they can’t. “We’ve taught our team to make sure they get commitment from the supplier before doing anything else,” he says. “Once you have commitment and understand the parameters, timeliness and inventory levels, then you can go sell it. Salespeople don’t like to say no, but everyone, suppliers and distributors, needs to be doing the work beforehand before making promises.”

Step Back and Re-Commit
After seven years of reporting on this industry, I know how much suppliers and distributors depend on each other. I also know that end-buyers put pressure on distributors, who then put pressure on suppliers. I understand it’s a delicate dance, and not easy.

But I also know this – as much as suppliers and distributors have needed each other over the years, they’re going to need each other that much more to survive this mess. No one knows exactly when this will be over. It serves no one to ream out overworked CSRs and burn bridges, when everyone will need to help pick up the pieces on the other side of this. Meanwhile, everyone should be clear, forthright and communicative, so distributors can figure out contingency plans as early as possible.

With so much out of anyone’s control, suppliers shouldn’t be abused for trying to manage distributor expectations in a very fluid situation, and distributors need to manage end-buyer expectations. Meanwhile, both parties should focus on re-committing to more effective and proactive communication.

There’s hope on the horizon with the vaccine roll-out, but that too comes with uncertainty. The only control we have is to choose our attitudes: opt for kindness, understanding, patience and clarity over frustration, anger and obfuscation.

This is one of the most resourceful industries in the world. I firmly believe that suppliers and distributors can continue to find grace and understanding to extend to their partners. Because without strong relationships on the other side of the pandemic, the industry will be a shell of what it once was.

*Due to the sensitive nature of this particular topic, we agreed to run anonymous comments from industry members, at their request.