I hear a lot about how many things are going to change posts COVID-19, including supply chains (and global supply chains in particular). I have already expressed skepticism of, what I see, as primarily wishful thinking. So, view the next post as just one more data point, strengthening my confirmation bias.

 The NY Times had an interesting article a few days ago, and GQ magazine covered it a bit earlier. The story begins with the following interesting observation, telling the story of two trainers.

 "After the stay-at-home order was put in place, the two began holding virtual workout sessions. But clients would need to supply their own basic equipment. The problem? Basic workout equipment was all but impossible to find. "I did not see this coming," said Meron Tamrat, 32, a Harlem resident and JTW Fit client. She purchased a dumbbell and kettlebell immediately after the stay-at-home order was announced in March. But a few weeks later, when she needed more weights, she hit a dead end. "Everything was just gone," she said."

 In trying to understand the root cause, one has to start going upstream through the supply chain, as well as down memory lane to the previous recession.

 Take, for example, Rogue Fitness, a U.S. manufacturer and retailer of strength and conditioning gear:

 "Rogue prides itself on manufacturing and selling American-made goods, but the company's kettlebells are normally manufactured overseas. Most of the kettlebells that you could have ordered before March 13 were; it's probably not surprising that, in 2020, there are few American foundries eagerly pumping out large bulbs of iron."

 When Rogue ran out of Chinese made Kettlebells, they turned to Rhode Island's Cumberland Foundry.

 "The irony is that Cumberland Foundry doesn't really want to be in the kettlebell business. Cumberland isn't automated, and its president, Tom Lucchetti, estimates that it takes a full day to produce 40 to 50 kettlebells (with Rogue handling last steps, like painting the bells). Rogue typically buys internationally-produced kettlebells by the shipping container. "I've been clear with them from the start that isn't something we can keep up with," Lucchetti says." Besides, Lucchetti has no illusions about the current, likely fleeting situation. Foundries in America have, since the '80s, been decimated by globalization."

 If you ask yourself, why I am not too optimistic that this is a sea change and the beginning of a new renaissance of U.S. manufacturing? The same story happened in 2008. And what was the outcome: 

 "Around 2010, Lucchetti says, the gym owner started selling his one-piece kettlebell to Rogue. Rogue, in turn, quickly figured out it could instead mass-produce its own kettlebell design. Cumberland helped Rogue prototype that design—then Rogue took that design overseas to be manufactured, a fate Cumberland anticipated. "

  So, let's review what we just went through: customers view Kettlebells as a commodity and thus are looking for the cheapest option. Manufacturing Kettlebells is more complicated than it seems and not insignificant capital investment, and given the relatively small scale of U.S. foundries, it is much cheaper to manufacture these overseas. This creates a cycle by which the local manufactures do not invest in scale (but are more responsive), and the retailers are unwilling to pay for responsiveness (which is not valued on most days) until it's too late, and when responsiveness is needed, we can't scale it.   

 What's the solution? 

 "Kettlebells — which are valued for their versatility and used in endurance, cardiovascular and weight training — are so hard to come by some New Yorkers have paid mysterious vendors nearly $400 for one set, more than four times what the average kettlebell cost two months ago."

 Some people call this price-gouging; I call that just the value of responsiveness. If you are unwilling to pay on the day-to-day to maintain a responsive supplier, you should be prepared to overpay when you are in crisis. If you are not thinking proactively, you should be "willing" to pay the penalty of being reactive.