Uniqlo is the latest retailer to succumb to shipping bottlenecks due to Vietnam’s Covid-19 woes.
The retailer warned on its Japanese website Thursday that it will be releasing some clothing items later than scheduled because of production and distribution delays in the beleaguered Southeast Asian nation, which is in the throes of a debilitating outbreak of the delta variant.
The four items, part of the Fast Retailing-owned company’s Uniqlo U collection of “Future LifeWear essentials,” comprise a men’s merino-blend full-zipper sweater, a men’s hoodie sweatshirt, a pair of men’s sweatpants and a girls’ mock-neck sweatshirt dress. They were planned to debut at the store between late September and mid-October. No ETA was given.
“We can confirm that a limited number of Uniqlo U items will not be available at Uniqlo stores in Japan until after the official launch date,” a spokesperson told Sourcing Journal. “The delay is due to temporary production delays at some of our partner factories in Vietnam because of lockdowns necessitated by the spread of Covid-19 in the country.”
Once a model for keeping Covid-19 in check, Vietnam has been inundated by a surge of infections that have crippled its apparel and footwear supply chain and sent brands and retailers scrambling for alternatives. The extension of business hub—and outbreak epicenter—Ho Chi Minch City’s lockdown till the end of September is likely to inflict further social and economic pain, even as cases show few signs of abating. Vietnam has recorded more than 656,000 positive cases and 16,400 deaths, most of them since May. One-third of the country’s apparel and footwear factories has essentially been put on ice.
The crushing uncertainty led Wall Street research firm BTIG to recently downgrade Nike shares, noting that two months of “virtually no unit production” at the sportswear giant’s factory partners in Vietnam have jettisoned 80 million pairs of shoes. Another four months at half capacity could cost the Just Do It firm to lose out on 160 million pairs in total.
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Abercrombie & Fitch, Chicos, Dicks, J.Jill, Lululemon, Torrid and Vera Bradley have admitted to similar sourcing headaches as a result of shuttered factories, congested ports and container shortages. In August, Under Armour spoke of a “very fluid situation” in Vietnam, while Adidas warned investors that disruptions could have a “negative effect” on profits in the second half.
One executive told Roger Rawlins, CEO of the footwear conglomerate Designer Brands, that he saw six years of supply-chain work unravel in six days. “When you think about the amount of effort everyone was putting into getting out of China, and now one of the places where you can get goods is China—it really is crazy, the rollercoaster that everybody’s been on,” he said at a recent management conference.