Retailers and trade groups are sounding the alarm about how President-elect Trump’s proposed tariffs could lead to higher prices. However, officials at TJ Maxx’s parent company have a different view, saying the discount retailer could actually benefit.
TJX Companies Inc. CEO Ernie Herrman said Wednesday in a conference call with analysts that when there is “chaos” in the market, it usually presents an “opportunity for us.”
His comment referred to whether tariffs could provide any benefit to the low-cost department store business model.
TJX Companies, Inc. also owns Marshalls, HomeGoods, HomeSense and Sierra.
Under these proposals, a universal tariff of 10-20% could be imposed on imports from all foreign countries and an additional tariff of 60-100% could be imposed on imports specifically from China.
“Manufacturers could deliver their goods sooner,” Herrman said. “This could even create additional availability of goods at favorable prices for us, because we can take advantage of them opportunistically.”
Herrman declined to speculate on what would happen, but said that if tariffs were implemented, the company would be “designed to ensure that we maintain our value gap” between competitors. Whatever happens with the tariffs, the company will ensure that its “values are proportionately lower than these, as they always have been.” » said Herrman.
If a brand faces tariffs on a certain category, forcing it to raise its prices, and those higher prices are passed on to other retailers, the price of that specific item could increase slightly, according to Herrman. However, he said, “we will never have a problem with the value gap we have compared to the competition.”
The comments follow remarks from Walmart Chief Financial Officer John David Rainey that the proposed tariffs could lead to higher prices for its shoppers.
“The prices are going to be inflationary. There’s no doubt about it,” Rainey said during an interview with Liz Claman on “The Claman Countdown” Thursday. “It is likely that consumers will pay more for the items they pay for and have these rates applied to.”
In a statement to FOX Business, a Walmart spokesperson said the company remains “concerned that a significant rate increase could result in increased costs for our customers at a time when they are still feeling the remnants of inflation.”
Executives are not speculating on the magnitude of the price increase or which products would be affected if the proposal were to go ahead.
However, the National Retail Federation (NRF), America’s largest retail trade group, estimated in a recent study that Trump’s proposed new tariffs could cost American consumers between $46 billion and $78 billion in purchasing power. per year.
The NRF also said six categories of goods would be affected, including clothing, toys, furniture, appliances, shoes and travel items.
Some U.S. manufacturers could benefit from the tariffs, but the gains for U.S. producers and the Treasury would not offset overall losses for consumers, according to the trade group.
