Tariff talk is misleading as it relates to tariff
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(Total Views: 100)
Posted On: 04/05/2025 11:36:16 AM
Tariff talk is misleading as it relates to tariff percentages. My experience has been directly related with China but it applies to all. Here is the key point, a 25% tariff is on the COST of the material imported - not the retail price.
The above is key as most companies will not simply pass through the tariff cost - to do so would reduce their gross margin, net profit percent etc. To maintain margins, and optics of profitability metrics, a margin will be added to tariff cost on a par bases with their average company wide gross margin. A 25% tariff quickly becomes 35% plus.
FYI.
The above is key as most companies will not simply pass through the tariff cost - to do so would reduce their gross margin, net profit percent etc. To maintain margins, and optics of profitability metrics, a margin will be added to tariff cost on a par bases with their average company wide gross margin. A 25% tariff quickly becomes 35% plus.
FYI.
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