Corona Virus Update
Following Chinese New Year and the ongoing Wuhan-originated Novel Coronavirus (2019-nCoV) situation we have been responding to many queries from clients, suppliers, friends and family regarding the situation here in Hong Kong, in China and elsewhere in Asia. This is an update on the situation from our perspective.
Please be assured that we have been maintaining ongoing contact with each of our offices and our associates throughout China, here in Hong Kong and across Asia. There has been a saturation of coverage of the corona virus on both mainstream media and social media, which is welcome in raising awareness but, for some, is also giving rise to undue concerns and worry. In order to assess the evolving situation, we have been in contact with vendors, respective government authorities, freight forwarders and travel agents / airlines as well as reviewing best practice recommendations issued. As with other flu related conditions, it is expected that the health risks associated with the corona virus will diminish at the end of the winter flu season.
The safety of our associates, their families, clients and vendor partners are of paramount importance. The situation remains very fluid with updates and changes being issued on a daily basis. We are reaching out to all vendors in China for updates on PO production and shipments. As soon as we receive information, we will be updating clients immediately.
Supply Chain & Production
- The PRC has extended the Chinese New Year Holiday until 10 Feb so that factories and businesses in China remain closed. Unofficially, the PRC is asking businesses to extend their re-opening date for another week and to remain closed. Significant pressure is being placed on business within China not to open for business next week. Companies will be held responsible if they do so.
- In Hong Kong, Connor associates are on a voluntary return to office, work from home or alternating team schedule for this week and next per government direction.
- The PRC has issued guidelines imposing rules and regulations on companies opening for business that they are required to implement with their workers and work places. One of those is advance notification from each employee announcing their intention to return to work to be received a min. of 5 days in advance. Others are for workplace protections to be provided to employees and reporting requirements.
- In addition to severe travel restrictions from, to and within Hubei province, the PRC has announced similar restrictions for Hangzhou near Shanghai and other cities effective immediately.
- Both social compliance audits and inspections within China are expected to be particularly impacted. All China social compliance audits have been cancelled through next week. We are now looking at inspections with factories re-opening and how best to address. We are investigating and likely to propose greater use of certified factory self-inspection based on the process and technology we have already in place to support this already developed and in use for specific clients.
- Connor associates have been identifying and prioritizing near term production and shipments and keeping clients advised accordingly as events unfold.
- Production delays are expected, especially in apparel, as mills have not been operating and may be closed longer. This affects not only China production, but also ex-China production relying upon China fabric. Shipment delays to May can be expected.
- We are checking into sample dispatches and how these will be handled upon China re-opening. We are seeking info from DHL, FedEx and others along with US Customs and will update.
- Connor IT is working on the broader use of video conferencing and apps like WeChat, WhatsApp, Zoom et al that we may deploy for greater video conferencing between offices, suppliers and clients and will update soon.
- Concerns have also been received regarding what workers and US, and other countries’ customs might do on arriving containers from China. We are now checking with forwarders and respective import agencies and will update soon.