July 30, 2021

To Our Valued Customers,

We have received positive feedback from many of you over the last few months and are excited at the growth and optimism we share halfway through the year. This is certainly a welcomed improvement from last year and we remain very confident in future opportunities and growth as we finish the second half of 2021.

With this growth and recovery, the several business and operational challenges each of us experience and observe remain present. We wanted to share updates along with information to help provide guidance in our future business together.

The challenges in supply chain and manufacturing unfortunately remain. We continue to see this globally across all industries, the shortages in labor and raw materials to produce consumer products continues to drive up unit costs. Transportation both domestically and internationally remains at all-time highs in costs, delayed timelines, and is unreliable or difficult to secure. In addition, COVID-19 continues to hinder global progress on securing reliable and consistent labor. The challenges of finding labor are seen throughout most of our country in businesses and our communities.

These extraordinary challenges have created significant changes in costs for all areas and has reached a level that we are not able to sustain. This unfortunately requires us to make pricing updates. Effective September 1st, our website will be updated to reflect these changes. We will extend and honor published pricing on purchase orders received before this date. After this date, we will need to adjust our prices for all orders moving forward. Our teams will be providing communication on any price quotes up until this time period to help prepare for this transition.

We are very excited about our industry’s continued return and growth, especially for this holiday season. Despite the challenges, events and meetings are returning and we see the demand for promotional products increase. While optimism is strong in each of us, we need to also prepare ourselves for this continuous surge in demand. We would invite and encourage you to plan with your clients for an increase in demand this holiday season. This potentially may include longer production lead times, shipping delays from freight carriers, rapidly changing inventory levels and more. We have made significant inventory investments to bolster upcoming stock levels to prepare for this. Our team has been working to increase our labor levels as best we can to build and improve service levels to you as a partner.

Despite the challenges, we remain resolute we will find mutual success as we work and plan together.

We truly value your support and look forward to a strong finish together in 2021!

Sincerely, Your ETS Team and Family.

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