How Does the Chinese Spring Festival Affect Chinese Exports?

 

As we all know, Christmas and Thanksgiving in the US can cause delays in business due to scheduled closures. But are you also planning for possible delays due to holidays observed in China? And how exactly does this affect Chinese exports?

We’ve covered the holidays celebrated in China before in “Chinese Holidays: An Overview of the Festivals Celebrated in China”, which explained how important the Spring Festival is in China. In this blog, we will focus on the New Year traditions and how they affect Chinese exports.

As you may know, Chinese people, no matter where they are, still go back to visit their hometown when the New Year/Lunar Year arrives, despite how difficult booking travel and accommodations can be during this time. Some people even resort to riding motorbikes across thousands of kilometers because tickets for planes and trains are sold out! It is expected that about 2.89 Billion trips will take place during this time. And they do all this to spend a few days with family members they seldom see throughout the year.

Along with family, the New Year brings many interesting traditions. For example, on the first day of Chinese Lunar Year—we call it “Chu Yi”—the Chinese need to get up early to embrace the New Year, but cannot do any washing or cleaning for the entire day because doing so is believed to drive away luck and wealth.

Throughout the celebration, the elders usually give money packed in red packets (“Hong Bao”) to little children in hopes that they will grow up slowly, stay healthy, cherish their time and keep bad luck at bay.

So how does this mass traveling and tradition affect Chinese exports?

First of all, most factories will close for at least 15 days as billions of workers head to their hometowns for the coming New Year. It won’t be “business as usual” until after the Lantern Festival. During this time, expect the speed of office-related administrative work to be much slower than usual.

When it comes to logistics, our forwarders always advise us not to arrange shipment dates too close to the New Year or during the New Year for the following reasons:

1. The forwarders run the risk that not enough workers in the container yards will turn up to work, even as the cost of shipping doubles or triples during this holiday.
2. There will not be an adequate number of vessels available for a lot of orders pending shipment during the New Year.
3. The cargo may still be left behind if the vessel is too full, even if it has been scheduled in advance.

In 2018, the New Lunar Year will fall on February 18th. The national holiday will be celebrated from February 15th to February 21st. However, most are not aware that some office personnel begin their holiday much earlier in February. Some factory works do not return to work for a whole month during this time.

To better manage your production and shipping schedules during the upcoming New Year, and to avoid the risk of delays, discuss these details about the New Year with your forwarders and suppliers in advance. And keep in mind that the Chinese Lunar Year holiday date varies each year.

How have you avoided delays during the Spring Festival? What are some challenges you have faced because of it? Share your experiences with us below.

 

By Christina Zhao