Chinese New Year and impact on the purchases
The CNY 2021 marks the beginning of the Year of Metal Ox. Regularly celebrated in France, as in many countries around the world, it is the most important holiday in the Chinese calendar. This year it will take place from February 12 to 26.
As a dedicated sourcing agency in Asia, Eastwise informs you about the stakes and impacts of this traditional celebration on your purchases during this period.
#1 Chinese New Year, what is it?
The CNY (or Lunar New Year) is still called “Spring Festival”, in the symbolic sense of “looking forward to spring”. The date varies every year.
In 2021, it will begin on Friday February 12. Its celebration lasts 16 days: from New Year’s Eve (2021/02/11) to the Lantern Festival (2021/02/26), the week of February 11 to 17 being a public holiday. This is the longest and most important holiday period of the year.
#2 Business impact of the CNY on your purchases in Asia
The factories stop production to allow their employees to return to their families, sometimes thousands of kilometres away. All factories, ports and logistics facilities are closed, without exception. This means that the event is putting manufacturing and sourcing across China under pressure! In addition, these holidays also have an impact on other South East Asian countries, which means a minimum of 2 to 3 weeks of disruption for your transport needs throughout the region.
At the beginning of March, employees are starting to return to the factories with the problems that this generates (recruitment, training, worker training). Production gradually resumes and the factories take time to return to full capacity, often towards the end of March.
This year there is one more problem: the Covid-19. The CNY is described as one of the largest annual migrations in the world. However, the coronavirus spreads in confined and overcrowded environments. Government travel regulations have forced workers to leave factories early to arrive on time for holidays, which may have caused early disruptions to supply chains.
The Chinese New Year creates production difficulties and becomes a real challenge for traders and freight forwarders, but also for suppliers in China.
#3 What Eastwise can do for you
As an expert in the field, Eastwise is your best ally in avoiding disruptions in your supply chain and costly delays.
At the heart of the event (we have an office in Shenzhen), starting in September, we are able to map plant closures with the following information:
– When will the factories close?
– When will we place the last order to be shipped before the CNY?
– When will the last shipment take place?
– From what date will we be able to place orders again for shipment just after the CNY?
– When will shipments reach the port of destination during the CNY? The aim is to collect the shipping document and avoid delays in customs clearance.
In order to anticipate and plan your orders as well as possible, we try to negotiate prices before the CNY (around November/December of the previous year), so that they do not take off afterwards.
As our support is in several stages, you should know that after the CNY, we will visit each factory to make sure that it has returned to its previous production level and implement corrective actions if necessary.
“Kung hei fat choi”
While there are many ways to wish you a “personally enriching New Year”, there is only one to meet your needs: Eastwise, at your service! Together, we will create the conditions for successful shopping in Asia:
- Planning the CNY as early as possible,
- Anticipate your orders,
- Build up sufficient stocks to cover your business needs until one month after the CNY.
Contact us to tell us about your plans: 2021, or even 2022! And, as it’s never too late to start early, please note that CNY 2022 will take place on February 1st.