When the coronavirus, also known as COVID-19, hit China, Wilson Lau remembers the news being very alarming and slowly turning into a real professional matter. Nuherbs’ vice president mentioned he said this at that moment:
“When the Chinese announced that they were extending the Chinese New Year Holiday in early February, we said, ‘Uh-oh. Here we go. This is serious.’”
Lau had the right suspicions. Coronavirus is indeed serious, not only because it threatens the public health by being transmitted from one person to another, but also because most of the Chinese herbs and health supplement importers may have been exposed to it.
The Dietary Supplements Industry and Even the Global Economy Being Affected
As said in the subtitle, the dietary supplement industry and even the global economy are being affected. The stock market is feeling the quarantines’ effects, as well as people no longer going to work, which means the supply line of health supplements has suffered negative changes. With China being the epicenter of the coronavirus epidemic, the dietary supplement chain supply has experienced a decline. Worse than this, the more the disease is spreading and turning into a pandemic, the more operators in the industry are going through the revelation moment that Lau experienced when first hearing about COVID-19. This means they should prepare themselves for more.
Quarantines Put a Stall on Transportation
Lau thinks there are many reasons why people need to be concerned. He says that quarantines have put a stop to transportation and that this can have a cascade effect into many other sectors. Businesses and individuals have had a strain put on them, which means suppliers are harder and harder to come by, whereas quality impact and adulteration may follow. While the companies that have purchased ingredients before the new tariffs are sure to have a better position when compared with those that didn’t, the ones using their just-in-time inventories are sure to suffer the most.
What Lesson Should Suppliers Learn?
Suppliers should definitely prepare themselves or work with other suppliers who are prepared. Here are Lau’s exact words for them:
“Companies that do business with China were prepared for the annual holiday, and planned shipments accordingly, so they’re not likely to feel an immediate impact.”
This should happen even if they were ready for the Chinese New Year’s shutdown. It’s true that many have as much stock as they need on hand from before the disease started to spread, but the future doesn’t look too promising for now. At least the harvests they’re waiting on have already been acquired, but this doesn’t indicate the risks of the disease getting spread are reduced. The major concern remains on how the materials are being commuted to the US. Here’s Lau advice on this specific matter:
“Contact your ingredient sources to make sure you’re working with them proactively to ensure continuous supply. Help the uncertainty situation by providing certainty.”
Hopes Are on the Disease Being Contained
In case the coronavirus gets to be contained and the Chinese exports start to make transports once again, which is something Lau hopes to happen by April, the dietary supplement industry is sure to be fine. However, if things go beyond that, the supply line will face serious challenges, impacting the global economy in a very profound manner.