Why Are Stores Are Running Low On Toilet Paper? It's Not Just Hoarding Why are supermarkets running out of toilet paper? It's partly the same psychology behind a bank run — and partly about bottlenecks in supply chains.
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Why Are Stores Are Running Low On Toilet Paper? It's Not Just Hoarding

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Why Are Stores Are Running Low On Toilet Paper? It's Not Just Hoarding

Why Are Stores Are Running Low On Toilet Paper? It's Not Just Hoarding

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AILSA CHANG, HOST:

Since early February, stories of toilet paper shortages in stores have traveled around the world basically in step with the coronavirus. Alexi Horowitz-Ghazi of our Planet Money team has a few reasons why.

ALEXI HOROWITZ-GHAZI, BYLINE: Here's the mystery in short. Carol Lucking (ph) lives in the little town of Spearfish, S.D., where she says at least as of late March, the coronavirus pandemic didn't feel like it had fully arrived.

CAROL LUCKING: Like, I know the local Irish pub had a huge blowout on St. Patrick's Day...

HOROWITZ-GHAZI: Uh-oh.

LUCKING: ...Which was a little horrifying.

HOROWITZ-GHAZI: Even still, the toilet paper aisle of her local grocery store was empty.

LUCKING: There's no toilet paper. For sure, there's no toilet paper.

HOROWITZ-GHAZI: That is where the pandemic panic struck first.

WILLY SHIH: I think people are choosing toilet paper to hoard just because of fear.

HOROWITZ-GHAZI: Willy Shih teaches on supply chain management and manufacturing at Harvard Business School. He says that stocking up on staple goods is perfectly rational but that in the case of toilet paper, many consumers have overcompensated, sometimes buying several years' worth of supply. And that's collided with a supply chain built for stable demand.

SHIH: It's not like the holiday season, you use more toilet paper or for birthday celebrations, you use more toilet paper. You know, toilet paper demand is proportional to how many people are in the population.

HOROWITZ-GHAZI: And to be fair to panicked consumers, coronavirus may not change how much toilet paper we actually use, but it has shifted where we use it. Widespread closures of schools and workplaces mean that all the toilet paper that would be going to work-time bathroom breaks is now getting soaked up by consumer demand. But that's still not enough to justify buying a year's supply. That move comes from the same mass psychology as a bank run. People are buying extra because they see other people buying extra, and nobody wants to be last in line, even though there is enough - just not enough for everyone buying all at the same time.

SHIH: If you're a manufacturer of a product like that, you can run your plants a little harder, maybe run them a little faster. But you have all these bottlenecks.

HOROWITZ-GHAZI: Bottlenecks like trucking capacity, warehouse and storage space and labor shortages all affect how quickly grocery stores can restock their shelves during surging demand. But that doesn't mean we'll actually be running out of toilet paper anytime soon.

SHIH: We'll have spot shortages, OK? But in terms of manufacturing capacity, it's not like all the factories suddenly burned down. I mean, those factories are still running. There's still lots of wood pulp. And they have inventory and distribution centers.

HOROWITZ-GHAZI: And since the U.S. manufactures the vast majority of its own toilet paper, things like the worldwide border closures that have complicated other supply chains aren't likely to affect our overall stock. The only thing we have to fear, at least when it comes to toilet paper, may just be the fear of running out.

Alexi Horowitz-Ghazi, NPR News.

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