Some retailers are using tariffs proposed by President-elect Donald Trump to encourage consumers to shop now, suggesting that if the import duties take effect next year, a product range could cost Americans a lot more money.
This is another sales tactic that some companies implement, in addition to traditional tactics. Black Friday discounts, to attract consumers spend as much as possible before the holidays.
On Monday, Trump pledged to add 25% tariffs on all products. from Mexico and Canadaas well as a 10% levy on Chinese products, in an effort to combat illegal immigration and illicit drugs entering the United States. The proposed taxes come on top of previous election promises to impose a 10% base duty on all U.S. imports and a 60% tariff on goods shipped from China, once he takes office.
While prices on a variety of productsranging from shoes to vacuum cleaners, could indeed rise if Trump moves forward with his tariff proposals, some retail experts say retailers could seek to exploit people’s universal fear of missing out on a deal or of a limited-time experience. But the tactic could also offend some buyers, experts warn.
“It’s a double-edged sword. I think it might get people to buy things, but it might also divide consumers if they think everyone is going to raise their prices,” said Neil Saunders, director general and retail analyst at GlobalData. “The other problem is that it’s also a bit political, so some retailers would like to avoid that.”
While Trump has said he plans to move forward with the tariffs, some economists have pointed out that the next administration may simply use the duties as a bargaining chip, which could allow the White House to conclude new trade agreements, for example. Although the tariffs are far from certain, a number of companies have explicitly stated that the levies launched by Trump will inevitably force them to raise prices for consumers.
“Lock our current prices”
For example, filtered showerhead maker Jolie recently said it would have passed on some of the anticipated costs of the tariffs to consumers. In a recent email to customers, the company said tariffs on products made outside the United States “would mean we would have to increase our prices.”
“If you’re considering purchasing a Jolie, now is a great time to lock in our current prices,” the company added. Currently, a shower head with filter subscription costs $148. The company announced a new “potential” price of $178.
Corie Barry, CEO of consumer electronics retailer Best Buy, also said during its latest earnings call that the products it sells could become more expensive as part of Trump’s proposed tariffs.
Any additional costs on U.S. imports from the three countries “will be shared by our customers,” Barry told investors Nov. 26, noting that “there is very little that can be done.” [the] consumer electronics space that is not imported.
Sales “before price”
And on Facebook, a Dallas, Texas-based furniture store called Finally Home Furnishings announced a “pre-price sale” that will run through January, earlier this month.
“Get a deal while you can,” the retailer said.
Finally, Home Furnishings did not immediately respond to CBS MoneyWatch’s request for comment, nor did it indicate the extent to which it expects to have to increase its prices if new tariffs take effect.
Etsy seller Buzzy Park, which sells handmade bamboo picture frames, also announced a “pre-price” sale on its entire inventory, starting this month and until new Prices come into effect. “Hurry up and buy them at their current prices,” Park wrote in a social media post.
While prices on a variety of productsranging from shoes to vacuum cleaners, could indeed rise, some marketing and retail experts say even sellers who don’t expect to face additional costs could use potential tariffs as an excuse to charge customers more .
“If consumers panic about things getting more expensive, they’re playing into the hands of businesses across the country who are using that as an excuse to raise prices, even when it’s not necessary,” Scott Lincicome said. , trade expert at the Cato Institute. , a public policy research group. “
He added: “It’s a pretty handy excuse when you’re in a constant battle with consumers over price. »
