U.S. Retailers Brace for New Round of Tariffs
HONG KONG - Some of the U.S.’s preeminent retailers are readying for the eventuality of a new round of tariffs on goods from China, the Wall Street Journal reported this week. The financial news source cited Walmart, Amazon, Dollar General, and Target as grocery retailers who are already working to renegotiate prices and shift product assortment in order to avoid rising costs—and, in turn, raising prices.
“If we get tariffs as discussed in January, prices are going to go up,” Walmart Chief Financial Officer Brett Biggs told the WSJ. The most current round of tariffs—a 10 percent fee levied on $200 billion in Chinese goods—came into effect in September; additional fees of 25 percent are expected to be leveed at the beginning of 2019.
Walmart has been one of the more proactive major retailers; the company has reportedly already pulled some planned purchases forward to get ahead of potential cost increases. And the WSJ noted that Amazon has “cut back purchases and orders for certain of its private-label products where the tariffs make it no longer profitable to offer those goods to customers at sub-competitor prices.”
Dollar General told the WSJ that, in addition to renegotiating prices with Chinese vendors, the company has canceled orders and made adjustments to its product mix, while Target noted simply that it has “many levers” to use to remain price competitive.
To learn more, read the WSJ’s article in its entirety here.