Billionaire entrepreneur stuck in supply chain ‘backlog jam’

China COVID lockdowns adds pressure to ‘all areas of supply chain’: Billionaire entrepreneur

Paul Mitchell, Patrón Spirits and ROK Group co-founder John Paul DeJoria says his companies are still stuck in the ‘backlog jam.’

Self-made entrepreneur and co-founder of Paul Mitchell, Patrón Spirits and ROK Group John Paul DeJoria cautioned that China’s latest COVID-19 lockdowns could worsen supply chain backlogs as his billion-dollar companies still face disruptions and delays.

"We see in all businesses what is coming from China, any ingredients… hard goods that come from China, really backordered big time," DeJoria said on "Mornings with Maria" Wednesday.

"At first, we thought we would just start, 'Let's order 50 percent more,' like most companies did," he told FOX Business’ Dagen McDowell. "But all of a sudden, we were still in the backlog jam."

DeJoria joins the group of retail experts and port executives warning that lockdowns and closures in China amid its largest COVID outbreak since the pandemic began could cause another wave of serious supply chain disruptions.

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"In all the businesses, whether they're bringing things in from foreign countries or bringing things across the United States, all areas of the supply chain, whether it's bottling, whether it's ingredients and things of that nature, and little components, are backordered," DeJoria explained, "and we've been through this."

John Paul DeJoria attends an event presented by Paul Mitchell. (Getty Images)

When the entrepreneur started his career in the early 1980s, he had to overcome inflation, unemployment and interest rates that were "a little worse than they are now." DeJoria then described how business tactics used decades ago can help relieve supply chain pressure today.

"We went to a second source and then to a third source. We started broadening our horizon," the billionaire said.

According to DeJoria, Paul Mitchell had $40 million worth of product backordered in the last six months, "so we went to other suppliers."

"We diversify out on where we got our ingredients from. But more important, we don't take away from what we believe in," DeJoria said of the hair brand’s cruelty-free promise.

Still stuck in the backlog situation, DeJoria said he’s been exploring switching to strictly "Made in America" operations.

"We're looking now at sourcing in the United States of America," the entrepreneur confirmed. "Now, a lot of our vendors are not equipped to do that, so we're helping them do that in any way we can."

Billionaire entrepreneur says to ‘diversify’ supply source amid inflation

Paul Mitchell, Patrón Spirits and ROK Group co-founder John Paul DeJoria on how his companies overcame inflation in the 1980s.

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Despite increased costs, DeJoria is optimistic about the switch to an American-only supply chain.

"We may pay a little bit more, but we have the product," he said, "and we create more jobs for Americans."

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