And so it begins.

[richard1rst]

I just received an email from one of my long time suppliers.

(quote)Due to proposed government tariff increases that are beyond our control, we will be implementing a 10-12% price increase.(end quote)

Now notice: because of a PROPOSED tariff (which may or may not happen, and may or may not be the amount that is expected) they WILL raise their prices.

Strikes me that they should wait until they are certain of the amount, if any, before arbitrarily stating a semi-specific increase.

Expect more to come.

[robbie31415]

If someone is increasing the price without them having their price increased, it tells me more about them then anything.

IDC if they expect it to happen, your supplier is bad.

The market is flooded with cheap products from China. If the price goes up on them (which they should, they are only so cheap because of bad arrangements) then it increases competition for American goods.

[johnrj1226]

I guess it  is OK for other countries to impose  excessive tariffs on American goods imported in to their countries - Sweden and Japan are two that I am familiar with.  They do it to protect their home industries.  For example in  Sweden a  pair of Levis 501 in 1985  sold for about 5 -6  dollar in Sweden they  pay aid %0 bucks.  A  wireless telephone hand set was  around 50 bucks at Radio Shack - $600 in Sweden. My  Swedish cousin  bought   beaucoup  and sent back home.  Been to Japan 5  times was  in  more  than 5 different cities  and rarely  saw  an auto from  one of the big 3.  Tariffs and  volumes of paperwork to  have one imported.  Saw a ton  of Toyota Corolla's and Camry's and those little Honda Civic's - they were  parked inside the  business buildings - no parking lots  or on-street parking.

[richard1rst]

---

@reallynicestamps wrote:

Remember when dropshipping resellers' products are shipped to their customers from "overseas", the customers have a personal duty-free allowance of $800 per transaction.

So if your supplier ships directly to your customers and you sell products under $800 you will be fine.

If your supplier warehouses in the USA, those goods will have the tariff applied on entry.  And your supplier will be charging you the additional cost of the tariff.

---

And THATmight the predicate for a recent move by Amazon. They are starting a new pogran called “Amazon Haul”. It is described as items selling for less than $20, frequiently under $10. And is said to be in response to compitaition from Temu and Shein.

BUT

The wrinkle is that unlike their normal rapid delivery these are being quoted as delivery time of a week or two.

BECAUSE they will be shipped directly from Amazon owned warehouses IN CHINA! That plays directly into your point. By shipping direct from China to consumer instead of buying in bulk and having it shipped to a U S warehouse they avoid the tariffs.

[tools*]

Most products "manufactured" in the United States today use parts and materials from China. Virtually all circuit boards and electronic components used anywhere in the world are made in China.

This tax will affect everything and everyone.

[duffy4444]

   Hmmmmm...

   I wouldn't be surprised if blaming a future possible tariff is NOT the real reason why they're raising prices. Maybe it's a convenient excuse and a ruse in order to raise prices just for a boost in profits and has nothing to do with a potential future "tariff". I wouldn't put it past many companies.

Cheers, Duffy 

[my-cottage-books-and-antiques]

@richard1rst I can understand not being happy about this, but this strikes me as what another former president would have called "prudent." Your supplier is being sensible. As ebay has noted, China is ebay's #3 site by sales volume (US, UK and then China (followed by Germany, which used to be #3), and the Chinese ebay sellers sell heavily to the US, especially in Parts and Accessories, which is ebay's biggest single category and in which ebay has a very heavy investment. Jamie has said that the Chinese have been busy doing "forward deployment", which is to say, they anticipate there will be tariff increases ,maybe massive increases, and so they have been trying to stockpile inventory in the US in advance. I would guess most Chinese (and other) companies are taking this seriously, and are anticipating high tariffs, possible loss (or certainly, a decline) in their American markets, and so they are being pro-active, raising prices in your case to build a cushion against the impact of the tariffs, while forward deploying what they can, and of course, also looking at new markets for their goods. In other words, they are doing what businesses do, which is adapt to what governments do.

If your American suppliers acquire some of their raw materials from elsewhere, they could be impacted by the tariffs and might need to raise their prices as well.

The American economy proved remarkably resilient during inflation, with much complaining by consumers, but all that complaining did not lead many of them to pull back from purchasing , which is one reason prices didn't decline as rapidly as some hoped----usually, as prices increase, demand decreases, but many Americans just kept buying, which provided no incentive for businesses to lower prices.

So if you and your competitors raise their prices because of price increases from afar, it is very possible that your buyers will just keep buying (while complaining). It's not clear just high prices would have to get before demand really drops.

My suggestion (and I'm sure you will do this) : monitor price increases , both your suppliers (foreign and domestic) and your competitors, so you can take your own prudent steps should it become necessary.

[my-cottage-books-and-antiques]

@richard1rst  But the "send directly to consumers" $800.00 de minimis rule will almost certainly be under review as well, in part because it is exactly how companies like Temu have been able to move so aggressively into the US market. There has been considerable discussion about reducing or even eliminating the $800.00 amount, and that has been coming from politicians on the left and right. (Of course, there has also been opposition to any such change...but I wouldn't assume it will remain untouched.)

I sell used, vintage and stuff, so will not be directly impacted, but we will all be impacted one way or another. As you say, it will be up to us to adapt. 

[robbie31415]

I hope that's true.

De minimis needs to go.

No reason a seller with fulfillment from China can sell stuff cheaper with free shipping then it even costs for me to ship something from California to Calfornia.

The rule has been horrible for us sellers, and with Temu sprouting up to massively use it. Tiktok too with all the cheap stuff on their shops.

Needs to stop.

I didnt even know Amazon was making a response to them with direct from China.

Makes sense. It makes getting goods to Americans from overseas extremely cheap.

[inhawaii]

---

@12345jamesstamps wrote:

'Boy Wonder' makes cars in China as well as in the USA...so wonder what will happen.

And there's Temu and Shein....people buy items on Temu & Shein and re-sell items at a higher price here...LOL.

And Tik Tok which started selling items...plus the " T  Family' used it for a platform running for President....and now no 'T Family' is on Tik Tok so that will probably get knocked off in January.

---

I heard the bibles a recent candidate was selling were all made in china.

[toomuchstuffagain35]

Unless the personal threshold of $800 disappears it won't do a thing to stop the offshore sellers here who sell direct to the consumer (with no quality control etc).

[richard1rst]

@my-cottage-books-and-antiques 

I an going to take 2 separate comments from your post, marry them together and use them as a basis for describing what I did in Jan 2021. And that same principal applies today.

they are doing what businesses do, which is adapt to what governments do.

so you can take your own prudent steps should it become necessary.

In Jan 2021, with nothing more than a “seat of the pants” vibe I viewed the then incoming administration as Jimmy 2.0. Older members who lived through Jimmy 1.0 know what I mean. Remember 20% Stagflation? 12% mortgage rates? Unfortunately for the economy as a whole, I was more right than wrong.

So in Jan 2021 during my normal visits to assorted manufacturer’s trade shows, instead of buying what I guessed would be a year’s worth of inventory I bought what I guessed would be 3-4 years worth. Then when sales slowed down they became 4-6 years worth. Other than a few fill ins here and there I haven’t bought any substantial inventory since 2021 and I am still flush with inventory. Talk about a positive cash flow. And, or course, I routinely “mark to market” to offset what accountants call the “time value of money.”

I suggest that same principal applies today. Knowing (unlike guessing as before) that increases are coming I would suggest scraping together as much as you can and over buy your inventory. Which again, marked to market, will make you more money than sitting around and fretting what to do.

Be proactive

Always shoot for the moon.

Even if you miss you will at least live amongst the stars

[vintage-camerastuff]

Stop importing that China junk.   With the tariffs all that garbage will go away.   Thank you Donald Trump!

[my-cottage-books-and-antiques]

@richard1rst  I have enough inventory (old, used, vintage, antique) to keep me going for years. (I still buy, because , for me, the "hunt" is the fun.) But you are right: Your decision in 2021 and your supplier's decision today are basically the same thing: a business adapting to what (the business feels) is on the horizon. 

[my-cottage-books-and-antiques]

from a recent news article. It's not just your supplier...

"If we get tariffs, we will pass those costs back to the consumer," Philip Danielle...(CEO of Auto Zone)---adding that the company would raise prices "ahead of" the imposition of tariffs, rather than wait."

I suspect other businesses will be doing the same thing.

As I said, it's really no different than you stock piling inventory in 2021. It's simply a business being pro-active.

[mam98031]

@richard1rst 

I'd say you need to replace that vendor anyway.  We are MONTHS away from possible tariffs, seems your vendor is just looking to make a little extra money now.