Tariffs, Trade War and Your Business


With all the so-called ‘experts’ talking about tariffs and a trade war, have you heard anything that clarifies how our businesses will be impacted? Beyond direct cost increases of tariff-targeted products, how the factories that manufacture your products fare is critically important. Will they be able to survive? And if they don’t, what will happen to inventory, tooling, and deposits?

Tariffs in Recent History

During the great recession, several weaker players moved on, leaving a smaller but stronger overall manufacturing landscape. Could that happen again? In May 2018 at the 123rd Canton Fair in Guangzhou, China, Jennifer Pak of Marketplace surveyed four importers and exporters. None believed impending tariffs would significantly impact their operations. Besides their strength, the commonality of these companies was diversification of products, production bases, markets and customer base. Conversely, in April 2017 a Bloomberg survey of three factories found that two were at risk of closing long before tariff talk, despite well-known and impressive customer lists. Both factories expected that any increase in costs would push them out of business. The third factory in the Bloomberg survey claimed to be diversified and unconcerned with tariffs or a trade war.

Your Trade War Strategy

How do you know the health and strength of your factory-partners who are 7,000 miles away? You can certainly learn a lot by visiting the factory. Beyond subjective observation, however, it is difficult to determine a factory’s status without being part of the local business community and culture.

Partnering with a global company like Revotech brings affords your company the benefit of our manufacturing expertise, as well as our role in the local communities and cultures. We already have the insight and experience. We look forward to helping you.

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