Toymakers Warn Supply-Chain Issues Are a Threat to Holiday ShoppingCovid-19 has caused a massive bottleneck in the global transportation pipeline.

ByAmanda Breen

Don't wait to do your holiday shopping if toys from today's biggest brands are on your list: Toys will be more expensive this holiday season — and harder to find.

The shortage is due to significant challenges within the global transportation pipeline,CNBC reports. Covid-19 has led to a massive labor and supply shortage, which was worsened by theblockage of the Suez Canal in March.

Container ships idle at U.S. ports, full of inventory that has yet to be unloaded — there simply aren't enough workers to get the job done.

Toy executive Isaac Larian, CEO of MGA Entertainment, says shipping containers that cost $3,200 prior to the pandemic go for upwards of $20,000 today. MGA had expected 50% sales growth this year, but now anticipates just 18% to 20%.

Power outages in China, a resin shortage and higher labor costs have further complicated matters and caused prices to climb.

"It's a really, really complex set of problems that has a chain effect, and I'm afraid that this will continue for a long time," Larian said.

Related:A List of All of the Shortages in U.S. Economy, From Diapers to Cars

Retailers will be hit hard if merchandise isn't on shelves in time for holiday shopping, as sales plummet significantly after the December 25 deadline. It will also negatively impact toy companies, which will find it difficult to move more inventory when retailers still have warehouses full of it.

Salesforce predictsa 20% increase in prices this holiday season, andaccording toToday, KPMG expects a 7% increase in holiday sales for U.S. retailers, almost double the historical annual growth rate. That means shoppers must get in early if they want to find the gifts on their lists.

"If your kid has their heart set on something, go buy it now," said Steve Pasierb, CEO of the Toy Association. "Don't wait."

Of course, toy companies aren't the only ones affected by the thwarted supply chain, but giants like Home Depot and Costco have the resources to find workarounds: going so far as to contract dedicated container ships to expedite their orders.

Wavy Line
Amanda Breen

Entrepreneur Staff

Features Writer

Amanda Breen is a features writer at Entrepreneur.com. She is a graduate of Barnard College and received an MFA in writing at Columbia University, where she was a news fellow for the School of the Arts.

Editor's Pick

Related Topics

Business News

An 81-Year-Old Florida CEO Just Indicted for a $250 Million Ponzi Scheme Ran a Sprawling Senior Citizen Crime Ring

Carl Ruderman is the fifth senior citizen in the Miami-Fort-Lauderdale-Palm Beach metropolitan area to face charges in connection with the scam.

Business News

'Soul Crushing': Internet Sleuths Notice Something Is Very Off With This Condo Listing

From the grey carpets to the fluorescent lights, it's obvious that this home was not always a home.

Money & Finance

Want to Become a Millionaire? Follow Warren Buffett's 4 Rules.

企业家是不能过度指狗万官方望太多a company exit for their eventual 'win.' Do this instead.

Business News

'Awful Advice': Barbara Corcoran Slammed For 'Tone Deaf' Business Advice to Interns

The "Shark Tank" star shared tips on social media about how interns can increase their chances of getting hired full-time, but the public reaction didn't go as planned.

Green Entrepreneur

Phoenix Has Hit 110 Degrees for a Month, But This One Invention Is Cooling Things Down a Tad

For the Arizona city amid a record-breaking heat wave, cool surfaces bring a modicum of relief.