Summary: I’m sure you all noticed the empty store shelves of toilet paper at the very beginning of this coronavirus crisis. My reaction at the time was astonishment. Why are people hoarding toilet paper? It’s not as if there’s a hurricane coming? I couldn’t understand the bottled water shortage either for the same exact reason.<br> I wrote it off as a demonstration of those certain kinds of people who don’t think about what they do and just react emotionally to unexpected things in their lives. They have a <a href="https://www.bbc.com/news/world-australia-51731422">herd mentality</a>, doing whatever everyone else does. In the meantime, we “smart” people are thoughtful and rational in the way we live our lives. Right?<br> Well, alas, I have been forced to rethink my conclusions after reading an article by Will Oremus from the online business magazine, <a href="https://marker.medium.com/">Marker</a>.<br> So, getting back to the question: Were the empty shelves a product of hoarding or was there something else going on? And by the way, this phenomenon wasn’t just a U.S. thing; this was happening in Hong Kong, Australia, the United Kingdom, as well as in the United States<br> Now I’m pretty sure there was some panic-buying. All you had to do was look at all of the pictures of empty shelves in your news feed and something got unleashed in your primitive brain, scattering your wits to the wind. I mean who doesn’t suffer from <a href="https://www.psychologytoday.com/us/blog/stronger-the-broken-places/201501/10-ways-overcome-fear-missing-out">FOMO</a> occasionally (FOMO is the fear of missing out, in this case having NO toilet paper).<br> But maybe it’s not irrationality at hold here. Maybe it’s something entirely different—something entirely…..boring. Maybe it’s just a <a href="https://www.investopedia.com/terms/s/supplychain.asp">supply-chain</a> issue.<br> A couple of things we know for certain. A lot more of us are staying home so we are using more paper at home. Fine. And if we’re home, we are using less paper in the office and in restaurants which would normally take up the slack.<br> It turns out that there are two separate markets for the toilet paper that is produced in the U.S. There’s the consumer market (our homes) and there is the commercial market (our offices, restaurants, and schools). I mean, think about it—if 75% of us are staying home, we are using our own facilities not someone else’s.<br> Actually, according to Georgia-Pacific, maker of Quilted Northern, the average household will use <a href="https://www.gp.com/news/2020/03/statement-on-georgia-pacifics-response-to-covid-19">40% more toilet paper than usual</a>. That’s a huge jump in demand especially for an industry that is mostly boring and extremely stable. Toilet paper manufacturing is a stable, volume business with thin profit margins, and producers crank out rolls from factories that run 24/7. If there is a large change in one market over another, it creates disruption.<br> So, why can’t they just shift production from the commercial side to the consumer side? That’s a natural question and it’s a good one.<br> The problem—and this is the gist of the whole mystery—the two markets are very different. The commercial market is geared to make large rolls that fit on large special dispensers; the rolls are thinner and too big to fit in our houses. They’re delivered on big pallets quite different from the individually wrapped rolls of 6 or 12 we get at the supermarket.<br> Also, the paper is not normally produced at the same paper mill. Some companies focus on the consumer, like Proctor and Gamble which makes Charmin, and some focus on commercial and some on both. But the markets are, in a sense, like oil and water and can’t really be mixed.<br> In theory, if this virus turned into a long-term problem, the mills would try to retool to meet consumer demand, but at this point, they are probably thinking, like most of us,
