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Chinese New Year logistics doesn't have to become a nightmare

The Chinese New Year is a big holiday in China which means most people, including factory workers, will be off from work during this period. Already there it sounds like this could become a Chinese New Year logistics nightmare when it comes to planning for your goods to arrive on time during this period.

Don’t start panicking just yet, let’s take a look at what this really means.

 

How does it affect importers?

This holiday period leads to an abrupt shutdown of all production for almost a month:

  • All products that have not been shipped get stuck at the factory

  • No samples are manufactured

  • No quotes will be reviewed 

We understand that this might not come as a pleasant surprise...
But hey! Don’t worry, let’s take a look at what you can do as a purchaser, freight buyer or logistics manager to avoid Chinese New Year logistics bonanza!

First, let’s go through some of the most common questions around the Chines New Year celebrations.

 


 


When does the Chinese New Year occur?


The Chinese New Year follows the Chinese lunar calendar, which does not correspond to the Gregorian calendar, which is used globally, both in Sweden and in everyday life in China and other countries in Asia. This results in that the Chinese New Year occurs on different dates each year, based on the Gregorian calendar.

Important date

For example, the upcoming Chinese New Year 2021 occurs on the 12th of February, while in 2022 it will happen on February the 1th. Since there aren’t any logic to when the Chinese New Year take place according to the Gregorian calendar it can be difficult to keep track of when it happens. So, we have concluded a list of the next upcoming dates:

  • 2021: February 12
  • 2022: February 1
  • 2023: January 22
  • 2024: February 10
  • 2025: January 29
  • 2026: February 17
  • 2027: February 6
  • 2028: January 26
  • 2029: February 13
  • 2030: February 3

Ok, great, now you know what dates you need to consider when planning. Let’s dive deeper into how long the factories are closed around the holiday.

FactoriesFor how long do they shut factories down?

Most factories in China close one week before the Chinese New Year, and don’t have the production up and running again until two to three weeks after the holiday. In total, Chinese New Year factory shutdown corresponds to 3 to 4 weeks, which today has a huge impact on manufacturing globally.

Keep in mind that production is also slower than usual for a couple of weeks after production has begun again, which means that it is a total of a whole quarter that is affected for importers and manufacturing companies in Asia.

Empty Factory

Are there any factories open during this period?

Nope, there are no factories in China that are open during the Chinese New Year. Ports and some other services are still up and running but with reduced capacity.

Why is this?

It’s a legal requirement in China that all workers are off from work during this period. For many workers this is also the only time of year when they have the opportunity to meet and spend some time with their children and parents.

Despite this, many importers try to demand that their factories be kept open, but no exceptions are made. During the Chinese New Year, everything is closed.


What about other Asian countries, do their factories close as well?

Vietnam celebrates Tet, which occurs on the exact same date as the Chinese New Year. Factories in Vietnam are closed for about 2 weeks, which is slightly shorter than their counterparts in China. However, Vietnamese manufacturers are indirectly affected, as large quantities of materials and components are imported from China, during production in Vietnam.

Ok great so the factories are not functioning for a 100% for roughly a quarter a year, what about all the freight services that are connected to the factories. Are they still functioning as normal?

Do you happen to know the answers to those questions and want to skip forward to the "how"? Download the top 3 strategies to avoid a Chinese New Year logistics struggle.

Yes Please

Map of Asia

Is shipping from China during Chinese New Year possible at all?



Ironically yes, sea and air transport work pretty much as usual during this period. However, no goods can be delivered from the factory, to the nearest port or airport. Once the door is closed at your factory, there is no staff who can handle the shipping.

So not sure that it will help you get your goods delivered to your warehouse anyway. Ok what about the handling of goods, what is there to consider?

Open container - What will happen to my goods

What about Chinese New Year shipping delays?

Since production puts on halt, you can be sure that your goods that are in production will highly likely get off schedule.

If you have goods that are in production, or waiting for delivery, our advice is not to pay the supplier before the Chinese New Year.

No matter what they claim, the goods will usually not be sent faster.

 

Will the quality of the goods be affected?

The quality of your goods might get affected negatively, both before and after the holiday period around the Chinese New Year.

This is because the factories, before the holiday, tend to stress their staff to get orders ready before they close, which of course has a negative impact on quality.

Like that wasn’t enough a large number of workers do not return after the New Year. There is a risk that they stay at home in the provinces and start working at another factory. This leads to the fact that the factories when reopen, after the holiday, they must recruit and train new staff which then will affect the quality.

 

Factory workers going on holidayIn some cases, as many as 25% of all workers may quit after the Chinese New Year and not return to their factories. It will therefore be critical that the goods are carefully quality controlled, both for deliveries that take place shortly before, or immediately after the Chinese New Year.

 

Ok perfect, but now what?
All these questions and answers might have helped a bit, but what else could you do as a logistics or purchase manager to get a grip of the situation to avoid a Chinese New Year logistics big time struggle?

Download our guide on the top three strategies that will help you to avoid a Chinese New Year logistics headache.

Yes Please

Victor Salomonsson
Victor Salomonsson
Digital Growth Specialist @ Adnavem

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