08 Sep Shipping Rates Skyrocket After South Korean Company Declares Bankruptcy
As if fashion and footwear needed one more thing to worry about come holiday season, the bankruptcy of Hanjin Shipping earlier this month has sent shockwaves through the market.
Hanjin’s bankruptcy declaration last week has disrupted supply chains and sent brands scrambling ahead of the peak holiday shipping season, when warehouses stock up on goods for the busy fourth quarter. The firm is the seventh largest carrier globally.
Analysts are eyeing margins carefully, and said that as other shipping giants step in, they’ll likely be gouging brands looking to move product.
“The amount of product specifically affected is very small. But that said, what is much more impactful is that spot rates are going up significantly in the near term,” said analyst Steve Marotta, with CL King & Associates. “The West Coast Port issue of a year ago was much more serious. That bottleneck affected significantly more product from a consumer soft goods standpoint than what was currently represented from ships at sea.”