It isn't often that my real-world job and MTG finance side job share anything in common, however, they do occasionally cross paths. My current role is that of a Value Engineer, which is quite different from my previous role(s) as that of a Design Engineer. In my current role, I work in the purchasing realm and deal with cost reductions of parts and assemblies.
The relevant takeaway from this information is that I work closely with our purchasing team and listen to the issues they are facing currently. One of these issues is a worldwide shortage in shipping containers. I know you are probably thinking, what possible relevance does that have to MTG finance? After all, most of the items we ship are very small and likely never go into a shipping container.
However, this shortage is definitely affecting anyone with an online business. A large number of raw materials used to make most products are at some point shipped via container, as air freighting heavy goods is extremely cost-prohibitive. The lack of available shipping containers means that shipping costs go up and shipments get delayed waiting for containers to become available.
The most obvious effect is the shortage of top loaders that we are seeing. For a reference point, in early March of 2020, I was able to purchase 1000 top loaders for $45 which is $0.045 each, by September I had to pay $50 for just 600 which is $0.0833 each. Now, the going rate for used top loaders on eBay is around $100 for 500 or $0.20 each. This particular shortage actually has at least two root causes that I can think of.
- Most top loaders are manufactured in China, and most Chinese goods travel by large shipping vessels which, as you might guess, are filled with shipping containers. Thus, when shipping containers are in short supply, the cost of shipping goes up and that cost increase tends to travel through the system until it eventually lands on the customer. This is especially apparent on cheaper items that take up a fair amount of space. While individual top loaders are small, they are typically purchased in bulk amounts which can take up a fair amount of space.
- The plastic top loaders are made of is acrylic, which also happens to be the same material used in face shields and one that many businesses purchased sheets of to make clear dividers. Thus the price of acrylic itself has gone up considerably over the past 16 months.
If we look at the BCW website, we can see that the cheapest new top loaders can be bought for is around $0.0974 each, but they won't be available for a year.
This shortage has led to a shift to cardboard sleeves by many stores, mine included, that are actually cheaper than the top loaders though they look to provide less overall protection for the cards being shipped. I also had to raise my overall shipping rates to account for the cost increase of shipping each order. Even these cardboard sleeves are considerably more expensive than top loaders used to be, with a cost of around $0.136 each.
But these aren't the only shortages affecting MTG finance.
There are numerous stories here in the US of big-box retailers like Target and Walmart suspending or greatly limiting sales of Magic, Pokémon, and sports cards. This has gotten big enough that it has made the news and I still see many people posting in various MTG groups when they actually find products available at one of these stores. I do not doubt that some of these shortages are at least in part due to the aforementioned shipping container shortage given that Carta Mundi, the main company that prints Magic, is based in Belgium.
It is important to note that when shortages are only a short-term problem, many larger companies absorb any cost increases as opposed to alienating consumers by raising prices. However, that can't last forever, and eventually, it cascades down through the system and causes retail prices to rise.
What can I do in the meantime?
While it seems shortages for various goods may remain for the foreseeable future, there are steps we can take to alleviate some of the pain caused by them.
I actually ran out of top loaders back at the end of April and have been making my own cardboard sleeves using boxes I have from my normal everyday purchases. I have found I can make 8 sleeves from each cereal box and, depending on what my wife orders from Amazon, some number of sleeves from those boxes. One additional benefit is fewer trips to our local recycling center. I have shipped over 100 orders with these homemade sleeves and have had 0 complaints. I make them by making cardboard strips that are 3" by 8" and folding them down the middle and then taping up the sides. This creates a decent cardboard envelope for me to put the cards in and then tape up the top. I put my cards in a penny sleeve and have it face downward, towards the fold so that there is no chance the card slips out and touches any tape.
Another strategy for avoiding the pain of shortages is planning ahead far enough in advance to eliminate any "convenience" costs. A good example is bubble mailers, which I buy in bulk off of Amazon where a pack of 50 is $5.99 as opposed to buying a pack of 12 from Walmart is $4.97. I have to keep stock of my inventory and reorder when I get down to my last 5, but it means $0.12 per mailer instead of $0.41.