Retailers preparing for 'disaster' Christmas as import costs triple

Retailers are preparing for a 'disaster' Christmas, with gifts set to cost more - that's if there's any available to buy.

Retailers have paid as much as three times more to get goods to New Zealand in time, a cost that will be passed onto consumers.

But some businesses can't sell a thing until lockdown lifts, meaning they have to absorb that crippling cost. 

David Whittle's warehouse is so full he can barely move inside it.

"All of this product is sitting here waiting, it's beautiful product and we just can't sell it," the Nirvana Eastern Imports owner says.

Inside all of the boxes are handmade Turkish homewares. They should be on shelves for Christmas shoppers by now, but in Auckland, stores are shut.

"What do we do? We're stuck," he says

Stuck surrounded by $300,000 worth of stock, and that doesn't include the high cost of getting it here.

"You put on top of that the cost of freight, used to cost $8000 for a container, it's now $24,000. That has to come from somewhere. All that's paid for, all that product's paid for, we just can't sell it at the moment," Whittle says.

Every New Zealand importer is paying through the roof just to get goods here.

Foot Science International in Canterbury imports foam to make orthotics. The freight debacle has added up to $3 million onto its annual cost of doing business.

"We're having to pay premiums of anything up to 6 or 700 percent on our normal, well what I would have considered our normal freight charges," Foot Science international director David Boyd explains.

It sells most of its orthotics offshore in 65 countries but the cost of sending one container from Ashburton to San Francisco has gone from $3000 to $19,000 - a cost businesses have no choice but to cough up.

"If you want to be in the game in a year's time, you have to pay whatever it takes at the present time," Boyd says.

Business owners don't want to hike prices pre-Christmas but say that's inevitable.

"These costs will be passed on at some point, no one can keep absorbing those sorts of level of increase," Boyd says.

"It's out of our hands, it's completely out of our hands," Whittle adds.

So is certainty. Paying painful prices doesn't even promise them space on a ship or a freight flight.

"Right now, we're extremely nervous about whether or not we'll get the space we need every week to send goods out," Boyd says.

To keep trade flowing throughout the pandemic, the Government has underwritten an air freight scheme for two years, costing $365m. Importers and exporters are now calling for that same subsidy to be applied to shipping.

"What would be helpful is if we could bring that same type of assistance into sea freighting, which is obviously where the greatest volume of freight is," Boyd says.

Transport Minister Michael Wood told Newshub he's had reassurance from international shipping lines that they're committed to servicing New Zealand.

With Christmas coming and Auckland uncertain about what that'll look like retailers are reeling.

"Christmas looks like a disaster and for us we'll get through it, but for a lot of other retailers, it's going to be game over. I'm sure of it," Whittle says.

Not a game they want to be playing.