Although the Chinese New Year of Spring Festival is a significant fixture in every season, it can be unclear for newer shippers. In about a month, this holiday will start to mark the start of the “Year of the Rat” following on from the “Year of the Pig,” which is the year we are in currently. The fact that factories will shut down for several weeks is an essential consideration for all those that are involved in the shipping & logistics industry. Even when they open after the season, there will be a lag time that must be factored into all schedules. Anyone that is ordering goods to be delivered in February or March will be told that they are only likely to arrive between April and May 2020 due to the Chinese New Year festivities. All shippers working with Chinese partners know that this holiday impacts on trade to a far greater extent than any comparable holiday in Australia, Europe, and North America.
Chinese New Year: What is it exactly?
Several customs and myths are associated with the Chinese New Year. However, the principal purpose of the festivities is to honor ancestors and other deities. Each region in China tends to have some variations as to how they celebrate the event. The evening preceding the beginning of the year is treated as a family get-together for many Chinese families. The official public holidays last a week, but business is generally disrupted for longer as virtually all businesses including factories will close to celebrate the New Year. Many workers will also travel to gather with their families for the celebrations, thus needing time to return to their homes after the reunions.
Impact on shippers
The Lunar New Year poses a great challenge even for seasoned shippers as it could deal a significant impact for those businesses not adequately prepared for it. Although this is an annual event, those that are not familiar with the industry are sometimes caught off guard. You need to plan for delays, staff shortages, occasional mistakes, and even higher prices in order to keep your supply chain running as smooth as possible.
The most important thing is to have excellent communication with all your business partners. Work out which areas are likely to celebrate the Chinese New Year and estimate the impact based on the figures from previous years. Try to build relationships with partners who can continue supporting you during the downtime. The ideal situation is one where you have contingency plans long before the event occurs.