industry insider | Feb 8, 2024 |
Red Sea shipping delays hit the home industry

Geopolitics are making waves in the home world. Last fall, the Yemen-based Houthi militia made international headlines by targeting ships passing through the Red Sea. Four months later, despite retaliatory strikes by the U.S. and its allies, the attacks have continued and are causing a logjam in global logistics. Now the disruptions are starting to trickle down to the design industry.

Yemen lies at a critical choke point in the shipping route between Asia and the Western world. To avoid being attacked in the Red Sea on their way to the Suez Canal—through which an estimated 12 percent of global trade passes annually—cargo carriers are taking an alternate route around the southern tip of Africa, adding two weeks and considerable expense to every trip.

The disruption is most notable in Europe. But in an interconnected global logistics system, any snag has ripple effects. “We’re mostly shipping to California [across the Pacific Ocean], so this hasn’t been an issue for us,” says Geoff Hawkes, the chairman and founder of Rochdale Spears, a Vietnam-based manufacturing company that works with high-end home brands. But even so, there are complications. “You end up with too many containerships on one side of the world. Also, raw materials coming from Europe—fabrics from Italy, certain kinds of lumber—take longer to get to us.”

The American companies most affected by the conflict are those that rely heavily on imports from Asia, including most of the big-name home retailers. Analysts have pointed to brands like Wayfair, Bed Bath & Beyond and RH as most vulnerable, and last week Williams-Sonoma CEO Laura Alber said in an interview that the company has been rerouting shipments to adjust to the crisis. But even furniture companies that manufacture domestically are seeing an impact, as many rely on the global shipping network for parts and raw materials.

More recently, delays are starting to affect design firms. Just this week Houston designer Mary Patton placed an order for a chandelier from lighting merchant Abode Jungle, her first time ordering from the brand. A day later she received a message informing her that delivery was “estimated at the end of the month” but “due to [the conflict] in the Red Sea a lot of our packages have been delayed.” Patton immediately notified her client, who was unbothered by the prospect of a short wait. If it persists, Patton is planning to cancel the order and source a new chandelier locally.

Chanae Richards of Ọlọrọ Interiors in Philadelphia has run into the same problem. In the past four months, two separate vendors have pushed back the delivery date two times on orders, placing the blame on the conflict. Richards says that, fortunately, her clients have been understanding, and she has taken extra steps—more communication, gifts, lunches—to keep them up to speed and feeling appreciated. But the challenges remain. “Sometimes not having an adequate time frame gives clients a bit of trepidation and leaves us on edge too,” she says. “We want to finish projects. We don’t want to leave things hanging, so when we don’t have an accurate timeline, it makes it tough.”

It’s impossible to predict an end date for the conflict in the Red Sea. But even if the situation continues for some time, experts tend to agree that the logistics system can and will adjust to avoid escalating delays. “This isn’t like Covid, where you’re seeing a pileup literally everywhere in the world,” says Hawkes. “It’s one route, and there is a way around it.”

The crisis also comes amid a slow period in the home industry, as the demand for furniture and decor struggles to recover from the post-pandemic dropoff. By happenstance, it’s also now coinciding with the Lunar New Year—a time when many Asian factories shut down so their workers can celebrate the holiday (due to weak demand, many are closing for three or four weeks this year as opposed to the typical two). In other words, there’s not nearly as much pressure on the system as there was during Covid.

And though unexpected delays are frustrating for designers in the thick of a project, by now firms have developed a muscle for dealing with logistical setbacks. “During Covid, there were huge delays, and you had to be flexible and pivot,” says Patton. “At one point the city of Houston ran out of paint. We learned a lot of patience.”

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