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Originally Posted by Surfer  Wait till people are paying 15 bucks for gallon of milk or 20 bucks for a regular loaf of bread. Friggen lemons are $1+ a piece now. |
You'll see a lot of companies go under as they can't raise prices fast enough to cover transportation costs. I've got an internship at a major bread manufacturer, and distribution is rapidly becoming a cost driver.
Everyone made some big mistakes in the early 90s, moving production to where labor was cheap and not necessarily where the buyers were. No one could have forseen things going as badly as they are right now - and gas has gone up 4x in 10 years, when most facilities have a life cycle of 50+ years.
A lot of this has been coming for a long time - specialization at the plant level made a lot of sense when diesel was 99 cents a gallon, but nowadays it's killing companies to be moving product 1500+ miles between regions, instead of having local production with 150 mile truck runs.