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How to shop during a crisis

2024/11/19
logo of podcast The Indicator from Planet Money

The Indicator from Planet Money

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Introduction to the episode discussing how to shop during a supply chain crisis, featuring insights from logistics expert Terry Espoir.
  • Panic buying is triggered by events like dockworker strikes and hurricanes.
  • The episode introduces Terry Espoir, a logistics expert from Ohio State University.

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N P R.

It's a well known fact that .

americans love to shop.

We're just not .

always very good at IT.

Antic buying is big and caused by a dock worker strike last month that shut down ports along the east coast in south. In some shoppers responded by rating stores, they were afraid that close ports would mean a shortage of essentials, including the king of toilet .

paper shelves empty at all.

We get port strikes. Pandemics, hurricanes are all scary things that can lead to panic. And IT can be hard to know what will and won't beyond store shelves when they happen.

And that's why the indicator has your back.

This is the indicator for plenty of money I made in .

mar and i'm Stephen a. Saha from the gulf states museum. Today we're gonna talk to a supply chain superhero, but how to shop no matter what's the latest crisis, notting up the supply chain. So keep .

keep listening.

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R.

To be the guide in our shoppers guide, we got Terry espoir, his professor, researching logistics and supply chain management at ohio state university. And he actually gave us a one, a one a few years back on what logisticians do.

And Terry made IT sound like he almost moved you from justice to one of one, to a new major.

I was trying to recruit him back into studying logistics. He was like, wow, yeah, this is really interesting. And i'm like, what? Hey, men, come on back. We'd love to have you at a higher state, but I couldn't appeal to him. So you never stop recruiting, always be closing as say .

so you haven't been moonlighting as a logistician .

on the side here, not yet. But honestly, Terry makes a very persuasive .

and you can think of legislation as A W D forty for our economy. They make sure the supply chain, from rock goods to factories to store shops, moves as smoothly as possible.

While I might be easy to imagine a logistics professor getting judge about panic buyers, Terry actually saw the latest shopping spring as a good thing.

So you are propane buying to extent.

Let me not say i'm propane buying, but I am pro consumers making the link between there is something happening in logistics, oh, that could affect my daily life like I am very much pro that.

So to be clear, panic buying is not a good thing. You can create shortages or worse, the ones that got people panic in the first place.

So to avoid that, we got our crisis pires guide, which honestly is less a catoche of products to buy your skip and more of a mindset, a series of questions to ask before running to the store or filling your online shopping card.

For example, in the case of a global trade disruption like the dockworker strike that we just saw, the first question to ask is, is what I want to buy made domestically? Because if it's not being imported from some other country, in most cases.

there's nothing to worry about. And this let us kick a big panic buying purchase out of our shopping carts. I'm talking toilet paper.

The companies that typically manufacturer most of the brands of toilets paper that we buy in this country. They are pretty much manufacturing their product here in the us.

Terry says. When IT comes to global trade disruptions, you should still save most of your worries for the products that we do import. And that includes a lot of hair shop goods.

We're talking things like fresh fruit, fresh fish.

So instead of running to the paper isle, you should run to the seafood isle.

That's definitely something to take in to consideration.

Another item to keep an eye on when we're talking global shipping issues is medicine phmc.

Euros is one of those product areas that I actually advise people to maybe watch a bit because a lot of pharmacy ticals product and even the active ingredients in pharmaceuticals, a lot of that product is imported.

But at the same time, tourists hold off on the panicking.

Here's the thing. Most pharma companies have roughly around at one hundred and eighty days of inventory on hand.

six months of inventory, which, when you think about IT, is kind of a contradictory approach to the way a lot of companies Operated before the pandemic, right? You might have heard of this thing in logistics called the just in time economy, this idea that company should have goods and materials show up at stores and factories just when they are needed, right? No more, no less, and they shouldn't have a lot of extra supply just playing around.

But Terry says companies still remember the sting of how Justin time bit them when the pandemic threw out that timing and let the shortages. He says that meant we've seen a swing from just in time to just .

in case most companies have, you know really taken a different approach to be much more proactive about making sure that they keep inventory within and across their supply chains.

This also gets us to the next question you should ask before panicking.

Is this something that was sudden or something that was foreseeable?

Case in point, IT is actually possible that the docker workers could go on strike again. They only have a temporary agreement that lasts until mid je anew. And if negotiations fall apart, another strike couldn't sue. But companies have time to prepare. Every company .

that I engage with, they're watching what's happening with that poor situation. And they are buffering their inventories and they are preparing for in many.

many ways. So have faith in cian for this one.

Have faith in the logistician. Yes.

of course, not every supply change disruption comes with the a warning months or weeks in advance, right? We have been hearing about these lately in the form of natural disasters like hurricane .

ah and this is a scenario where terri says toilet paper actually makes a bit more sense to add to your shopping list.

If you have a big family and you don't know how long is gonna before, you will be able to get your hands on a replacement that makes sense. And so um for that reason, I think that you know it's a fine line between when IT becomes maybe a bit more of planning by and when we're just making good decisions to prepare our families for a contained and carefully shortly of interaction and getting access to products.

And this brings us to the final question to ask yourself, how much do you actually need because chances are IT is probably not a month supply of toilet paper, Terry says that's because logistics still have your back with a little help from meteorologists.

a lot of people that study meteorology, he got to work for corporations and really work at modeling and predicting where there might be potential weather issues. So if you're talking about the company like a walmart, they're moving inventory closer to those areas to be prepared to after the weather event.

We know for all the praising we're giving to legislation right now, they do have their limits. If a natural disaster hit somewhere, that's a major supplier of a vital product. Let's a problem like when hurricane HEllen destroyed a major I V fluid facility in north CarOlina, we're still dealing with an I V shortage because of that. Still, Terry says disruptions like that are the exception that average shoppers shouldn't worry too much about.

To summarize our guide, if we're dealing with a global shipping disruption like a port strike, you can leave anything domestically made of your property. St.

right? And if it's something exported, check to see how long people have known about the upcoming crisis, because there's a good chance companies have been building up their rainy day inventory.

And while I might be a good idea to stock up a little before a bad storm, do not buy every role of toilet paper because logistics are already at work, making sure the next tp shipment is on the way.

That's where the logisticians with our kate will soon be in and save the day I give us the opportunity to save the date.

Terry, expert logistics super hero Stephen, this actually reminds to me last time we interview tary, we actually made A A movie trailer for a logistic an action movie.

I already get the popcorn pop in.

In a world where shipping is slow to a craw or in stock levels don't equal launch, elf availability, who can greet order from chaos?

He said he would hear a supply chain manager. I am in .

theatre this fall. It's the logistics.

As hollywood call in all .

in that trailer yeah, i'm ready. You know.

staying ready. This epo is produced, in fact.

checked by corry bridges, with engineering by meal rouch, taking cannas, our editor. And the indicator is production of npr.

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