Item — HN Reader

FTA: Maybe not empty but less choice and alternatives not necessarily what you're looking for.

“I don’t see a complete emptiness on store shelves or online when we’re buying. But if you’re out looking for a blue shirt, you might find 11 purple ones and one blue in a size that’s not yours. So we’ll start seeing less choice on those shelves simply because we’re not getting the variety of goods coming in here based on the additional costs in place. And for that one blue shirt that’s still left, you’ll see a price hike,” Seroka said.

5 comments

It takes exactly 1 "bare shelves" post on social media to kick off panic buying which cascades.

In fact it doesn't take much of a change in regular buying habits to cause that it it's all aligned in the same direction.

i.e. a chunk of the toilet paper "shortage" can just be every customer suddenly buying one more pack that day "just to be on the safe side". Your local supermarket isn't expecting that, so the shelves still clear out that day - then the last person snaps a pic for social media....

Yeah, my Great Aunt and her friends would coordinate their purchase of sugar for making preserves each year w/ the local grocer --- while each of them could have bought all they needed at once, his stocking couldn't accommodate that, so everyone would let him know when they would start, and stop, buying a 5 lb. bag each week for each year's preserves.

It's that one person on the highway driving just a little too fast and a little too close to the person in front of them, then they tap on their brakes and it starts the chain reaction of 3 hours of bumper to bumper rush hour traffic.

This guy is not pricing in panic and irrational behavior. People do the dumbest shit when supplies start getting low and the news is non-stop talking about shortages.

Markets don't work that way. Supply is tuned to demand. When the supply is artificially constrained while the demand remains constant, it further strains already limited supplies, leading to empty shelves and rising prices. This is a fundamental principle of market economics. It's important to understand how these dynamics operate to grasp the broader implications of reduced imports from China.

I think the above quote is accounting for both constrained supply and reduced demand from rising prices. Vendors consolidate their product lines to remove redundant (ish) offerings due to reduced demand and the new difficulties in managing supply chains. I.e. a shirt may only come in 3 colors instead of 10, and it may be harder to get the popular color because vendors are less likely to keep a large stock in warehouses.

It doesn't violate market dynamics that I can see, though I'm far from an expert.

One possible complication is that there’s quite a lot of waste that’s tolerated in pursuit of fashion and variety. (For example, Ross Dress For Less specializes in liquidating excess inventory.)

So I wonder how that plays out? My guess is that retailers take fewer risks when ordering, sticking with products that they know they can sell, even if prices are higher.

But they will still guess wrong sometimes.

There's a lot of levers and people to squeeze along the way:

Currency Manipulation to relatively increase Chinese manufacturing income

Relocating manufacturing based on tariffs

Retail margin

US based design & engineering of products

Advertising and other marketing activities

Depending on the product some will be passed onto consumers. But for something like Nike's it's probably more like fewer shoe designers, Footlockers, less advertising, smaller contracts to athletes, more manufacturing in non-China countries, and so on. Everyone is going to take a bit of a bit and it's probably not going to be super noticable to any one part.

No reason to expect empty shelves. Higher prices for stuff that can't be moved out of China. Sure. But it's a tariff, not an embargo.

Currency manipulation - No. Inflation concern.

Relocation of mfg - years long process won't help the shelves or the prices.

Retail margin - yeah... retail will balance price hikes to avoid hitting profits with not pricing too high to further reduce demand. This is just one of the reasons prices will go up. It will reduce the demand to less efficient and profitable levels, but won't increase the supply. Shelves will be sparsely filled with more expensive items.

US based engineering and design -- analogous to mfg. Not a near term solution.

Advertising -- it doesn't matter how much you tell people to go buy shit if they don't have money and/or the prices are too high.

Why are you still apologizing for Trump's absolutely incompetent policies?

In addition tik-tok/insta are having post after post warning people that the shelves are going to be empty which tends to feedback into itself.

If you were going to buy 1 of X normally if you think X may be out for sometime you may end up buying 2-4 of X which will run the shelves out very quickly when 10-15% of purchasers do that unexpectedly. Other people see the shelves emptying and buy more too.

Going to be messy.

All I have to say is imagine if Biden did this, what the news would be saying.

> If you were going to buy 1 of X normally if you think X may be out for sometime you may end up buying 2-4 of X which will run the shelves out very quickly when 10-15% of purchasers do that unexpectedly.

There are enough people who buy 0 of X normally, but if they think there might be stockouts, will visit every store in their area and buy 100 of X so they can scalp them and make a buck off their neighbors.

> All I have to say is imagine if Biden did this, what the news would be saying.

Give it a few years. They'll say he did it.

"Why do you think Barack Obama wasn't in the Oval Office on 9/11?" "That, I don't know. Would like to get to the bottom of that." https://www.youtube.com/watch?v=vPfRGJRMbN8

Ah, yes, the difference between taking two slices at a pizza party because you fear it might run out vs taking none because you fear it might run out.

> All I have to say is imagine if Biden did this, what the news would be saying.

Surely you don’t mean to imply the media treated Biden less favorably than Trump?

At least for the 2024 election, I find it difficult to believe one could come to any other conclusion with all the rampant sane-washing that NYT, WaPo, etc. engaged in

Aggregate media bias across TV/Radio/Newspapers is interesting because both the direction and scale matters. Of course bias is only part of the story, do an objectively terrible job and you get more negative stories overall.

As a concrete example a great deal of left leaning media was very critical of Biden running for reelection and especially waiting that long to pull out. You almost never see that kind of thing from right leaning media outlets.

So, yes overall media bias favors Trump not because more outlets favor him but because the ones that do heavily favor him. Far left media is simply a more niche market than far right media. Mother Jones for example is well known but only pulls in ~16 million$ / year and even they where critical of Biden.

NYT, WaPo, MSNBC, CNN, ABC, NBC, CBS are not niche. They all ran cover for Biden until the debate made it too obvious. They were not "very critical". They are, however, extremely critical of anything Trump does.

You can’t ignore scale of bias here.

CNN and Fox don’t come close to canceling each other out because Fox is way to the right and CNN is more subtle. -2 + 4 is not zero.

Similarity Fox viewership is 3 million viewers in primetime vs CNN at 1/6th those numbers.

I wouldn’t say extremely critical of Trump. He brings half of it on himself. Simply reporting what he says and does that makes him look incompetent is not being particularly critical.

The media has been extremely critical of Trump. Sometimes deserved, sometimes not. But impossible to deny the bias.

I'd imagine they'd be saying, "Why haven't we seen Biden in over 100 days?"

So I look for shirts and only find pants.

Not an empty shelf in the literal way but empty on my demand

Which will cause a significant revenue issue for the retailer.

And depending on how much you’ve thought ahead, a significant supply chain issue for you.

Notably, this is really going to screw everyone using JIT supply chains.

Honestly I doubt that shelves will be empty. Retailers are ordering less stuff from China because they’re predicting that demand will go down when the price is higher. If retailers were marking stuff up roughly 100% and take the same markup (in absolute terms), everything from China will go up about 70%, and people will simply not be able to afford to buy as much stuff.

No. The price insensitive shoppers will buy everything and the shelves will be empty.