Weeks into the coronavirus panic-buying spree, toilet paper is still high on the list of most-wanted products. But why?
At Roche Bros. in Boston’s Downtown Crossing, for example, packs of toilet paper continue to sell out before 9 a.m., even with restrictions on how many shoppers can buy at one time. It’s a scenario playing out daily at supermarkets across the state, and for no good reason, according to supply chain experts. By now, many people are likely running out of space to store their stash of rolls. Yet the illogical hoarding continues.
As Harvard Business School professor Willy Shih put it, “it’s not like all the factories for toilet paper suddenly burned down.”
“The manufacturers and distributors are trying to catch up, and they will catch up at some point, but buying more than you need is not very helpful,” he said. “It’s the appearance of shortages drives people to buy more.”
Arthur Ackles, vice president of merchandising and buying at Roche Bros. Supermarkets Inc., said distribution centers are rationing the amount of toilet paper they deliver to supermarkets as they try to recover from the recent surge in demand.
“Just like we are limiting products in the stores to one or two packages of rolls per customer, our distributors are limiting our allocations,” he said. “Customers are buying more, stores are ordering more, distributors are ordering more — everyone is trying to get a fair shot of the product.”
Roche Bros. is ordering three to four times more toilet paper than normal, but is only receiving 20 to 30 percent of what it needs, Ackles said.
“We are trying to fill shelves that are already empty, so we really need much more than we are getting,” he said. “It’s a lot of strain on our stores, and it is frustrating that we can’t get enough product in.”
Ackles said he isn’t surprised that the coronavirus panic buying has sent shockwaves through the entire toilet paper supply chain.
“There were periods when our [toilet paper] sales increased by 600 percent, and I don’t think manufacturers were ready for that — why would they be?”
Shih agrees — there was no way for companies that make toilet paper to anticipate a virus creating such a shopping frenzy.
“If you are a manufacturer of toilet paper, you are going to plan your manufacturing capacity for a stable demand — you want to be as efficient as possible,” he said. “It’s not like there is a season where you use more toilet paper.”
That means there is not much wiggle room for quickly ramping up production — like there might be for seasonal or fashion goods — since most manufacturers already operate close to full capacity.
Georgia-Pacific LLC, the maker of Angel Soft and Quilted Northern toilet paper, regularly operates its plants around the clock.
“We are working hard to maximize the number of deliveries we can load and ship out of our facilities — you can [only] load and unload so fast,” spokesman Eric Ambercromie said in an e-mail.
Georgia-Pacific’s regional distribution centers have been shipping up to 120 percent more than their normal capacity since the outbreak.
Kimberly-Clark Corp., the makers of Cottonelle and Scott toilet paper, said in a statement to The Boston Globe that the company has plans in place to address increased demand, such as accelerating production and reallocating inventory.
But industry experts said it’s not enough for manufacturers increase to production — the entire supply chain must get up to speed, too.
“It is a chore to catch up — you have to get it on trucks and into stores, so it’s a complex problem,” Shih said. “Manufacturers are all trying to produce more, but they also need the logistics capacity to move it.”
Jeff Hopper, chief marketing officer of online freight marketplace DAT Solutions, said the demand for trucks is up by about 11 percent because of COVID-19.
“The replenishing and stocking of the shelves is happening,” he said. “The trucks are rolling as fast as ever, there are just not enough of them to make every run.”
Last week, the demand for truck shipments into the Boston area increased by 65 percent compared with the same time last year, but the supply of trucks only increased by 12.5 percent, according to DAT.
As a result, the price to ship goods into Boston also increased from $2.41 per mile to $2.65 this week compared with the previous week, indicating that it has been harder to find drivers, according to DAT.
The recent spike in demand for trucks is unprecedented, Hopper said.
“If it’s a hurricane, some coastal areas get hit hard and that disrupts the supply chain for that area, and [in] California. wildfires are disruptive for that particular area,” he said. “But this is global and national — it’s almost impossible to prepare for.”
Georgia-Pacific is not sure when the toilet paper supply chain will return to normal, Ambercrombie said, but manufacturers and retailers are urging consumers to stop buying in bulk.
“More products are coming in, so they don’t have to buy hundreds of rolls,” Ackles said. “The expectation is that it will continue to be available — if they don’t hoard.”
Shih said stores are likely to end up with a surplus of toilet paper once the pandemic subsides and consumers realize they have several years worth of the product in their homes. It’s a well-known phenomenon in supply chains called the bullwhip effect, he said.
“Right now we are telling manufacturers to make more, make more, but at some point they are going to catch up and have waves of toilet paper crashing into the grocery stores right when people don’t need it anymore,” he said.