Supply Chain Council of European Union | Scceu.org
Freight

Propain Acknowledges Long Lead Times and Price Increases

The German bike company Propain posted a statement on its site about how a sharp increase in demand for bikes due to COVID-19 has affected lead times and pricing for its bikes.

The statement explained that the delays come from problems with supply for the numerous parts that need to come together to build a complete bike. In some cases, the company wrote, shortage of parts can mean lead times of up to 14 months. For reference, the average lead time was around 90 days before the COVID bike boom. Propain’s online customization tool, which allows customers to pick the colors of their decals, saddles, and grips in the US and offers many more customization options in Europe, makes it even more difficult to predict what the company will need to stock in advance.

The statement also explained that the company has faced significant shipping cost increases and will have to pass that cost to consumers. Because of backups in sea cargo shipping, Propain has changed some of its shipments from sea to air transport to try to minimize the delays. However, air transport is expensive at baseline, and prices are rising as demand increases because more manufacturers have had to make the switch. It used to cost $10-$20 to ship one bike frame by sea, Propain CEO David Assfalg said. Now, the company has been quoted $175 for the equivalent shipment by air.

Propain is not alone in facing long wait times and shipping cost increases. Commencal posted a similar press release in late December, and although most other companies have been less forthcoming about the problems in supply this year, they all rely on essentially the same suppliers for parts that come from Asia and are scarce right now: suspension, drivetrains, tires, and more. No company is exempt from these challenges, so we can likely expect to see similar delays and pricing changes throughout the industry.

Related posts

Today’s Pickup: Bulkloads rolls out early features of planned TMS

scceu

ZIM promotes wider use of electronic bill of ladings during coronavirus outbreak

scceu

What Brexit deal means for me: Six bosses tell all

scceu