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Just when the hardware industry thought it had taken all that Coronavirus could throw at it, we were hit by yet another crisis at the end of last year in the form of a massive reduction in freight capacity and a surge in shipping prices.
We have been acutely aware of the stock shortages which have hit the whole industry in the face of record demand, and, at Mila, we battled throughout the Summer and Autumn of last year to try to get our stock levels up to something like normal. We had already spent eye-watering sums on airfreight to try to satisfy the most urgent orders and placed our biggest ever orders with our suppliers in the Far East to bring in sufficient stock ahead of the Chinese New Year shut down which takes place in February.
However, in the peak period before Christmas, the cost of shipping was rising by the day as demand for container space exceeded supply on the vital Asia-UK shipping routes. That was compounded by the fact that raw material costs were rising, the Chinese RMB was falling in relation to the US dollar and port congestion in the UK was being exacerbated by the preparations for Brexit.
Unfortunately, all that is now working its way through to the market in the form of surcharges and price rises which are completely unavoidable, but there is much better news on the horizon when it comes to availability.
Mila expects our stock levels to be back above 90% by next month and we will certainly be aiming for 95% OTIF and above by March.
And, in amongst these new orders will be some really exciting new products which we know will tick a lot of boxes for customers. As well as the new range of Heritage espag handles which we launched at the end of 2020, we’re starting 2021 with a new TS008 accredited letterplate, which will finally give the market a product which satisfies the very challenging anti-fishing rules in a stylish and easy to fit package.
All the support and loyalty we had from customers last year showed, I think, that they appreciated the massive efforts made by every single team member at Mila to help them navigate the threats and opportunities that 2020 presented. I can assure them we will continue with those efforts right the way through 2021.
