Cyberweld.com, a $40 million online distributor of welding and safety equipment, says supply chain issues are hitting the company hard.
“While demand is at or above 2020 levels, our ability to supply that demand has been greatly curtailed due to materials shortages,” says Bob Goodliffe, president and CEO at the retailer, No. 909 in the 2021 Digital Commerce 360 Top 1000.
Those shortages include everything from rubber hoses to microchips and engines, he says. “Sharp commodity price increases for items like steel, copper and aluminum are also causing folks to delay their purchasing decisions in hopes of a softer commodities market in the future,” he says.
And, like many online retailers, Goodliffe is finding the available labor pool lean and expensive.
The merchant hired one customer service representative and one warehouse employee during the spring, Goodliffe says. “Both positions were posted at about 15% above (pay increase) where they were advertised last year to attract decent candidates,” he says. “When posting the same positions at or slightly above last year’s starting wages, we really couldn’t attract any qualified individuals.”
He adds that Cyberweld isn’t planning to hire any additional employees for the rest of the year because global supply chain issues are driving down sales. The consumer demand is there, but supply shortages are making it tough to meet those demands, he says.
While Cyberweld’s products aren’t gifts a consumer would typically put under the Christmas tree, other merchants that do get a spike in sales over the holidays are ramping up staff. Josiah Gordon, co-founder and chief marketing officer at Drinks.com, the parent company of wine e-retailers Wine Insiders and Martha Stewart Wine Co., says demand for its goods is “through the roof.”
“We’ve been continually hiring over the last year to accommodate surging interest in ship-to-home alcohol,” he says. “The coming holiday season, where September through December always accounts for a sizable portion of adult beverage sales, is expected to be tremendous, so we’re adding even more positions across our entire organization—everything from marketing to account management to software development.”
Gordon says sales at Martha Stewart Wine Co. grew 211% in 2020 and Wine Insiders experienced a 70% spike in orders and a 60% increase in revenue year over year in 2020. Last holiday season specifically, Wine Insiders’ sales grew more than 40% year over year and Martha Stewart Wine Co.’s sales grew more than 100%, Gordon says.
“We expect another strong holiday season in 2021,” Gordon says. “Market expectations dictate that demand will not have COVID-lockdown type spikes, but we expect a substantial number of new customers that discovered online alcohol in the pandemic to seek out the convenience and safety of ship-to-home beverage alcohol again this holiday season.”
Currently, the company is actively recruiting for 10 permanent roles and plans to hire more employees intermittently from September-December, Gordon says. Drinks plans to hire 40 warehouse and 15 customer service employees for the holiday season.
Meanwhile, musical instrument and equipment retailer Sweetwater.com, No. 75 in the Top 1000, is preparing for another strong holiday hiring season, says Jeff Ostermann, chief people officer at Sweetwater. “We’ve continued to experience tremendous growth, and this has fueled our need for talent at every level.” He says the retailer specifically plans to beef up its distribution center staff. It plans to hire 200 seasonal workers for the fourth quarter, up from about 150 a year earlier.
The retailer grew its 2020 web sales 35.8% to reach $1.1 billion, up from $810 million a year earlier, according to Digital Commerce 360 estimates.
However, unlike many retailers, Ostermann says Sweetwater hasn’t encountered trouble attracting talent.
“We have fortunately not experienced the hiring challenges that have certainly impacted many other businesses and industries,” Ostermann says. “In fact, we’ve received record levels of applications this year. We largely attribute this to candidates seeing Sweetwater as a place where they can join a team that is both passionately committed to serving music-makers and one that is focused on caring for our employees incredibly well as they grow their careers with us.”
One of Sweetwater’s competitive hiring advantages is its range of free and discounted perks. Sweetwater prefers its employees to work on-site and has equipped its headquarters with ample amenities to make its office comfortable, including a free fitness center, medical center, in-house mental health counselor and personal trainer. It also offers a coffee bar and diner with food and beverages for sale at a discount.
Additionally, nearly every new Sweetwater employee is required to complete an intense 13-week training program called Sweetwater University. The course is run by more than 80 industry experts and contains 300 classes on subjects ranging from digital audio and modern production software to analog circuitry and acoustics. The perks combined with free education help the retailer attract top talent, Sweetwater says. The retailer says many of its customer service and sales staff have studied audio engineering or have other music-related degrees.