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Costco again limits purchases of toilet paper and bottled water

Product scarcity may impact holiday shopping
Product scarcity may impact holiday shopping, construction projects and car industry 03:19

Costco is reviving limits on how much toilet paper, bottled water and cleaning supplies customers can buy to prevent stockpiling amid the latest COVID-19 surge.

"We're putting some limitations on key items like bath tissues, roll towels, signature water, high-demand cleaning-related skews related to the uptick in adults-related demand," Costco Chief Financial Officer Richard Galanti told Wall Street analysts in an earnings call on Thursday evening.

While demand for the household basics has increased, the warehouse club is also having trouble getting the products onto store shelves, despite having ample supplies, he added.  

"The factors pressuring supply chains and inflation include port delays, container shortages, COVID disruptions, shortages on various components, raw materials and ingredients, labor cost pressures and truck and driver shortages," Galanti told investors. "Major brands are requesting longer lead times, and in some cases, difficulty in finding drivers and trucks on short notice."

Costco sounded an alarm ahead of the call, warning in an alert on its website that "some warehouses may have temporary item limits on selected items." The cautionary note coincided with warehouse club members who bought toilet paper online getting told to expect delays in getting the product, according to Fox Business. "Due to increased volumes, you may see a slight delay in the processing of this order," the retail chain stated in an email to Costco customers seen by the network. 

Costco declined comment.

On social media, people have recently posted about low supplies of items including paper towels, water and canned peaches, along with toilet paper, at some of the retailer's stores.

Procter & Gamble, which makes products such as Charmin toilet paper and Bounty paper towels, is increasing production by operating factories around the clock seven days a week and moving to boost shipping volumes, the consumer goods giant told The Wall Street Journal in late August and reiterated in an email to CBS MoneyWatch on Thursday. 

"This is probably the most challenging supply environment that we've all worked through in my 30-plus years in the industry," Jon Moeller, P&G's vice chairman and chief operating officer, said in a Barclays webcast earlier this month. 

Still, the current scenario is not as desperate as it was early in the pandemic, when panic buying made it hard for retailers to keep toilet paper on store shelves. But the latest burst of demand is one reason behind supply-chain difficulties hitting the U.S. and overseas, with labor shortages and shipping delays also affecting the quantity of some products. 

"Like all sectors of the economy, papermakers are dealing with challenges created by the ongoing pandemic. These include global and domestic supply chain issues, such as ocean freight bottlenecks and limited truck availability," American Forest & Paper Association CEO Heidi Brock said Tuesday in a statement.

The bottlenecks can be seen in record shipping congestion at U.S. ports, with transit issues involving trucks and freight rail hindering the delivery of cargo from ships to retailers and manufacturers. The California ports of Los Angeles and Long Beach on Friday announced expanded hours for trucks to pick up and return containers in a bid to alleviate the trouble.

"We continue to encourage consumers to only purchase what they need," a spokesperson for Kimberly-Clark said in an email to CBS MoneyWatch. The company, which makes Cottonelle and Scott toilet paper, is meeting current demand after increasing capacity early last year, she added.

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