It is already known that Coronavirus fear is gripping the financial markets worldwide. Now, the fear of the outbreak is starting to take a toll on shoppers as well. There are plenty of reports suggesting shoppers are stocking up on essential products over coronavirus fears, resulting in a shortage of certain products in the market.
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Coronavirus fears among shoppers
About two dozen new cases were reported over the weekend in the U.S. Also, the country has already seen two deaths from the outbreak. New cases of the virus were reported in Washington State, Florida, Oregon, and Rhode Island. Now the total reported cases of the virus have reached 89 in the U.S., up from 65 on Friday night.
After the new cases, at least two states declared an emergency and many others issued fresh warnings. It seems the new cases sparked fear among shoppers as well, who feel the outbreak could get worst. Thus, they are starting to stock essential products fearing shortages going forward.
As per a report from Mercury News, residents of the Bay Area were seen flocking to the grocery and wholesale stores. People were seen stocking up on disinfecting wipes, toilet paper, dry foods and other products.
Though many shoppers were on their usual Sunday visit to the stores, many also left the stores with their carts full of toilet paper, pet food, water and other dry foods.
“I have kids, so if something happens, I don’t want to go out,” said Wally McGee, who shopped for diapers, instant oatmeal, breakfast crackers and more, according to MercuryNews.
People stocking up on products could also be due to a sobering message from the CDC (Centers for Disease Control) last week. The health agency asked people to prepare for the outbreak as the number of cases rises in the U.S.
Shortage of products due to coronavirus
Assistant general manager for a Costco on Senter Road in San Jose also acknowledged that people appear to have been stocking up on items since the announcement. Further, the manager noted that due to the increased demand, they had to keep more stock of essential items, such as water, toilet paper, canned food and more, according to Mercury News.
“It’s been going on for four days now,” the executive said. “It’s not just Costcos in San Jose, but the entire region.”
Along with these items, another product that is flying off the shelves is hand sanitizer. Demand for the item is so high that Walgreens and CVS even issued a warning that they may soon run out of stock. Along with sanitizer, demand is also high for face masks and cleaning wipes.
“This demand may cause temporary shortages at some store locations and we re-supply those stores as quickly as possible," a CVS spokesperson said last week, according to CNN.
L Brands, which owns Bath & Body Works, said last week that its hand sanitizer business is seeing growth amid the coronavirus outbreak. In a call with analysts, L Brands chief financial officer Stuart Burgdoerfer noted that its hand sanitizer business represents 5% of the total business, and it is growing “at a very high rate.”
Moreover, cleaning goods companies noted that they are increasing investment in the supply chain to meet the increased demand. Clorox, which has seen a rise in its stock price even as the rest of the market has plunged, said they are preparing to meet any potential increase in demand.
Reckitt Benckiser also said last week that it is investing in the supply chain to prevent any shortages. The company owns popular brands such as Dettol and Lysol.
Shortage of supplies for healthcare
Along with the shortage of essential products, coronavirus also seems to be disrupting the pharmaceutical industry's global supply chain. Last week, the U.S. Food and Drug Administration (FDA) warned about a shortage of at least one drug.
FDA said that for the first time since the outbreak, a drug maker reported a shortage of a drug due to a site affected by the coronavirus. Last week, the agency said the shortage is because it is unable to access raw materials from China.
“The shortage is due to an issue with manufacturing of an active pharmaceutical ingredient used in the drug," the health agency said in a press release.
The FDA did not reveal the name of the drug, its manufacturer or the condition it treats. However, it did say the substitute of the drug is available in the U.S. Though the agency reported the first drug shortage, it assured that there are no widespread shortages for medical products and devices for now.
Further, the agency also contacted 63 companies which have 72 facilities in China that produce essential medical devices. As per the FDA, many of these facilities have been adversely affected by the outbreak.