Relax, folks, we don’t need to buy out all the meat, bread and toilet paper. Despite the empty shelves in some stores, there’s plenty more in warehouses waiting to be delivered.
Baltimore-area shoppers rushed stores again Monday, as the number of confirmed Maryland cases continued to grow, the governor issued new orders to shut down bars, restaurants, gyms and theaters, and the current closure of schools looked like it could stretch well beyond two weeks.
But retailers warned against the panic buying that has stressed their supply chains — their warehouses, their delivery fleets and efforts to restock shelves. And they sought to reassure customers that they are prepared for what will undoubtedly be higher demand in coming months.
“What folks are seeing right now is not a product of lack of supply,” said Ira Kress, interim president of Giant Food, the region’s largest supermarket chain. “There is not a food shortage. There is not a supply shortage. What there is is a delay in getting all those supplies replenished.”
The initial run on food stores came on fast Thursday, after Gov. Larry Hogan and school officials ordered all public schools to close for two weeks beginning Monday to slow the spread of the COVID-19 illness in the state.
Shoppers, some following advice to stock up for a two-week period, formed long lines that snaked their way through supermarkets. Items such as milk, bread, toilet paper and other goods became scarce and neighbors in online forums began offering tips for where to find what.
Giant Food’s Kress compared Thursday and Friday’s shopping patterns to “Snowmageddon,” the February 2010 blizzard. While Giant Food’s business had been up in a range of 10% to 30% in recent weeks, demand suddenly doubled Thursday and Friday from business as usual. Kress likened it to having 2 feet of snow predicted every day for two weeks.
Klein’s ShopRite, which runs nine stores in Baltimore and Harford counties and Baltimore city, had the biggest day in its nearly century-long history Thursday and then topped that Friday, said Marshall J. Klein, director of operations of the family-owned business.
“We’ve seen an unprecedented increase in customer traffic and volume in every single one of our stores,” Klein said.
Over the weekend, stores remained busier than usual, but less so than Friday. By Monday, though, Hogan ordered all bars, restaurants, movie theaters and gyms closed by 5 p.m.
“We’re back to nuts," Klein said Monday afternoon. “We are reacting to the situation as fast as we can. ... The grocery industry is reacting, and we will be able to ramp up to meet the increased demand of our customers."
Most of Klein’s delivery trucks, which come from a parent company distribution center in New Jersey, are one or two days behind schedule, he said.
“The ability to get everything here faster is impacting the condition in the stores,” he said. “This isn’t local. This is countrywide. So all the wholesalers, all the suppliers, everything just got boosted all at once. It takes time for the system to ramp up to meet the demand.”
Klein’s is bringing in extra trucks and extra staff, added several shifts to clean and sanitize stores, and quickly arranged an event for Thursday, Saturday and Monday at its training center on Riverside Parkway in Belcamp to hire seasonal workers to handle anticipated coronavirus-related demand. The company plans to hire cashiers for all shifts and overnight stockers. Other area grocers also indicated they will hire more people.
But others are trying to catch up by scaling back. On Monday, Sunbury, Pa.-based Weis Markets said it would reduce its hours to 7 a.m. to 9 p.m. daily starting Tuesday to give workers more time to replenish products and sanitize stores. Trader Joe’s and Harris Teeter took similar steps.
Retail groups are urging consumers to shop “responsibly” during the pandemic.
“Retailers — particularly grocery providers — are working with manufacturers, suppliers and government agencies to make certain essential products and services remain readily available to customers," said a joint statement by the National Retail Federation and the Retail Industry Leaders Association. "Retail supply chains remain strong and retail employees are working around the clock to meet consumer demand.
“If you don’t need an item in the next two weeks, leave it for someone who does,” the statement said. “Hoarding and stockpiling creates unnecessary gaps between the time that someone who truly needs a product can find it back on retailers’ shelves.”
Events that lead to panic buying can hit grocers especially hard because supermarkets operate on thin profit margins and count inventory among their highest costs, said Ravi Srinivasan, associate professor in information systems, law and operations department in Loyola University Maryland’s Sellinger School of Business.
“You carry exactly what you need and what you plan on selling and not a whole lot more than that,” Srinivasan said. “They have a general idea of what the demand is going to be for different products. Usually, there’s a general idea of how much toilet paper a retail store is going to sell.
“With the whole hoarding that’s happening, it’s making this whole supply chain that’s clean and working like clockwork go out of whack,” Srinivasan said.
The problem is exacerbated because demand is up for certain items all over the United States, so it can’t simply be moved from one high-demand market to another, he said. And manufacturers may not have the capacity to make more of an item, or they may need time to ramp up.
“Retail stores are stuck in the middle,” he said. “You have consumers coming in and demanding products and manufacturers saying, ‘Hey, we can only make so much and cannot make more than my capacity right now.’”
Giant Food’s Kress said demand is rising not only because of anxiety over the virus but also because school and university closures mean more people stuck at home eating more food in the home. The demand will only increase given the restaurant closures, he said.
“If you limit the numbers of places where Marylanders ... can go to eat and drink, they’re still going to eat, they’re still going to drink, but you’re limiting the places they can get those things from," Kress said. “We are starting to see that and will see another ramp up.”
Manufacturers are ramping up their production as demand rises, “which they have the capacity to do,” Kress said.
Other components of the supply chain, from warehouses to the delivery truck fleet, need to catch up as well, he said. All of that could take several more days, unless new closings or concerns about the virus crop up, Kress said.
The difference from a major snowstorm, he said, is that demand has not yet dropped back to normal.
“We’re catching up,” Kress said. “You will see, and we are already seeing stores recovering and the conditions and in-stock position is getting better every single day.”