A Christmas toy shortage for 2021 seems likely as retailers struggle to get enough inventory for the upcoming holiday shopping season.
Here’s everything you need to know about the toy shortage facing Christmas shoppers in 2021.
- KPMG, a professional services firm, held a survey seeking information concerning possible toy shortages.
- This saw them asking 114 retail executives how confident they were in supply for toys this Christmas.
- Of those 114, 82% responded that they are “somewhat or very concerned” about inventory shortages.
- All of these concerns trace back to the COVID-19 pandemic as lockdowns and other factors from it are limiting stock for Walmart (NYSE:WMT), Target (NYSE:TGT), and other retailers.
- It isn’t just toys, either, as several other sectors are also dealing with shortages thanks to the pandemic.
- So what does this mean for investors?
- One might think that we could expect lower holiday sales thanks to the Christmas 2021 toy shortage.
- However, it seems to be the exact opposite with KPMG estimating a 7% increase year-over-year.
- An increase in sales could be tied to rising inflation, which could jack up the price of toys this Christmas.
- The biggest solution to the shortage would be more workers.
- Unfortunately, fears of the Delta variant have many potential employees staying away.
Willy Shih, Professor of Management Practice at Harvard Business School, told the following to Newsweek about the 2021 Christmas toy shortage.
“Practically everything that moves by ocean containers cargo, which constitutes 95 percent of products that are globally traded, will be subject to some disruption this year. We will see shortages and higher freight costs, likely reflected in significant price inflation, across a wide range of sectors. Toys will be no exception.”
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On the date of publication, William White did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.