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Naugatuck Valley manufacturers get creative to solve supply chain woes

Fascia’s Chocolates in Waterbury is ready for Valentine’s Day. The shelves are stocked with red velvet heart boxes filled with milk chocolates, dark chocolates and tiny champagne glasses stuffed with truffles.

But Carmen Romeo, president of Fascia’s Chocolates, worries it’s not enough.

“I’m keeping more chocolate on hand than I ever have in our history, but I had to have a place to store it,” Romeo said.

He recently built a 500-square-foot vault in his warehouse to store an additional 4,000 pounds of chocolate. It keeps both raw material and finished chocolates in ideal conditions at around 50 degrees Fahrenheit and in low humidity.

Romeo is sitting on all this chocolate due to delays in the global supply chain and inflation. Manufacturers in the Naugatuck Valley have been getting creative throughout the pandemic, as they’ve been squeezed on all sides by inflation, supply chain holdups and labor shortages. The impact is indiscriminate, affecting the supply of everything from cleaning materials to Valentine’s Day chocolates.

“The goal by having such a large cool room,” he said, “is to be able to have enough [chocolate] in here that we don’t have to make it all in just a couple months.”

Having materials and prepared products on hand gives him more control and keeps Fascia’s Chocolates safe from price fluctuations or shipping delays.

More and more manufacturers are building up and sitting on inventory as a hedge against supply chain delays, according to Jeff Rossi, who advises manufacturers and distributors in Connecticut and nationally at CohnReznick.

“It just costs so much money to get landed products these days and short quantities available,” Rossi said.

Before the pandemic, manufacturers used to be able to work on the concept of “just in time,” according to Rossi, where distribution, shipping and manufacturing timelines were relatively fixed so that they could respond to demand as needed. Now demand is unpredictable, and the supply chain is too.

“Top of mind right now is supply chain and staffing. Those are the two top issues of manufacturers in Connecticut,” said Jamison Scott, executive director of Manufacture CT and executive vice president of Air Handling Systems.

Beyond those top issues, COVID-19, inflation and shipping are still causing problems. “Each one of them at one point or another over the past 24 months has been at a crisis level, it ebbs and flows,” Scott said.

“Everything is uncertain,” said Calla Fankhanel, vice president and director of operations at Mercantile Development Inc. in Shelton. Her family’s main business is in distributing professional cleaning wipes, and their main problem right now is shipping.

“I don’t know if my freight carriers are gonna raise my rates,” Fankhanel said. “I don't know if they're not gonna take any containers into Chicago anymore because the rail is backed up. I can ship the next day, but if the rail shuts down, my customer’s not gonna get it for a month, and that’s unacceptable to my customer.”

So they pivoted, and Mercantile Development Inc. started repackaging the products they could get.

The pressure is on companies big and small. Tool manufacturer Stanley Black & Decker in New Britain recently laid off workers, citing inflation and supply chain problems.

There’s only so much certainty creativity can buy. Romeo of Fascia’s recalled a recent moment when once again, supply was out of his control for his chocolate business.

“I got a call from our main supplier, who said I want you to know that we just got an official notice that cocoa butter’s been discontinued,” Romeo said.

He ordered enough cocoa butter for the next six months, but he’s not sure where he’ll get it after that. For now, there’s enough product to make it at least through Easter.

Ali Oshinskie is a corps member with Report for America, a national service program that places journalists into local newsrooms. She loves hearing what you thought of her stories or story ideas you have so please email her at aoshinskie@ctpublic.org.

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