The well-known saying, "Prepare your sled in summer and your cart in winter," is more relevant than ever in logistics, where seasonality plays a crucial role, significantly impacting every aspect of the supply chain. Gennady Gogenia, CEO of RTL Alliance, emphasizes the importance of thorough preparation for seasonal changes to help businesses avoid challenges and maintain competitiveness, especially during major national holidays like the upcoming Chinese New Year.
Conditions and Factors Influencing Seasonality
The Lunar New Year, which will be celebrated on January 29, 2025, along with the accompanying "Golden Week" and official holidays from January 28 to February 4, can unexpectedly impact businesses working with Chinese suppliers. During this period, it becomes extremely difficult to receive responses from suppliers and ensure timely delivery of goods from China. Approximately a week before the holidays begin, Chinese suppliers start limiting their operations, leading to slowdowns or even complete shutdowns at railway stations, ports, and customs checkpoints. This significantly affects shipment schedules.
As China is one of our key logistics destinations, we strongly recommend that our clients plan their deliveries from Asia well in advance, considering the current situation.
For example, during road freight transport from China, rates can increase by 10–20%, with demand undoubtedly exceeding supply. Temperature-sensitive and hazardous goods, requiring specialized transport, are particularly at risk.
Ports remain the main channel for Chinese imports into Russia. As the New Year approaches, there is a shortage of space on cargo ships, with virtually no availability by late December to early January. Shipping lines may update their rates daily depending on demand and might even raise prices on previously confirmed bookings. Waiting times for transferring containers from ships to railway platforms in Vladivostok and Nakhodka ports can reach 30–40 days. A repeat of last year’s situation, where ships waited up to 30 days for unloading, is not out of the question.
As for rail freight services, seasonal demand and the redistribution of cargo can increase the load on direct rail routes from China to Russia and Belarus by 30%. The rail network will be fully utilized as many businesses aim to ship their goods before the two-week holiday in China under relatively stable schedules. Border crossings will face the most challenging situations, where containers might wait for reloading onto Russian platforms for 2–3 weeks. High container volumes and border congestion force Chinese rail operators to adjust schedules, even canceling some trains due to a lack of rolling stock. This inevitably affects transportation costs, with rail freight rates potentially increasing by approximately $500 per container during the pre-New Year period.
High-Demand Goods from China
The Chinese New Year is a time when many companies see a sharp increase in demand for both imports and exports. Among the most in-demand export goods are food products and construction materials. On the import side, consumer goods such as home electronics, clothing, decorative building materials, toys, and gifts see a significant rise in demand. These items will be popular in the summer, so procurement and delivery should begin now to ensure availability by spring.
To avoid revenue losses during the holiday period, businesses need to stock their warehouses in advance. This helps prevent potential issues caused by raw material shortages, ensures timely deliveries to customers, and avoids situations where sellers are left without buyers due to a lack of goods. The main advice now is to act.
Understanding our clients' concerns about possible price hikes, we not only ensure timely cargo deliveries regardless of New Year-related rushes but also refrain from raising rates due to holidays, weather conditions, or increased demand. Additionally, we provide consultations on payments to foreign suppliers to help our clients avoid delays and issues in this area.
How RTL Alliance Avoids Holiday Logistics Collapses
"We firmly believe that during the New Year holidays, it’s crucial to maintain constant communication with contractors," emphasizes the company’s CEO. "In many cases, proper communication can help avoid misunderstandings and ensure reliable deliveries."
Our clients should understand that the main issue might not only be rising prices but also longer delivery times for goods from China. As mentioned earlier, delays are expected, and our company, as an experienced market player, proactively addresses these potential challenges. With our extensive network of agents, we can reserve space on ships to ensure uninterrupted container shipments by sea and at railway stations in China.
Our logistics company has years of experience in the market, and we develop strategic measures in advance to prevent disruptions during peak seasons:
- Early Planning: We prepare for the holidays in advance to guarantee uninterrupted operation of the supply chain between China, Russia, and Belarus.
- Resource Optimization: We explore alternative routes and increase the number of transport options and services used ahead of peak periods.
- Flexibility and Adaptability: Leveraging past experiences and modern forecasting technologies, we quickly respond to changes in demand and weather conditions.
- Continuous Updates: We keep our clients informed about current changes, enabling them to adapt to seasonal fluctuations and plan their actions.
By considering these simple aspects and the specifics of local holidays, you can ensure the uninterrupted operation of your business during periods of increased seasonal demand. Partnering with an experienced logistics company provides a reliable ally who can optimize logistics processes and meet your needs even during the busiest and most challenging periods, leaving you to focus on holiday preparations.