Trump’s gamenaship with China has retailers expecting shortages and higher wholesale prices…
The increase in cost to them WILL be reflected IN Higher Consumer Prices…
Between the lines: Walmart CEO Doug McMillon cited the “reality of narrow retail margins,” when discussing prices on the company’s earnings call Thursday. “Given the magnitude of the tariffs, even at the reduced levels announced this week, we aren’t able to absorb all the pressure,” he said.
- Consumers could see prices increase as soon as the end of May, “and then certainly much more in June,” John David Rainey, Walmart’s chief financial officer, said in a CNBC interview Thursday.
State of play: How much prices will rise and what products will be increased will, at least at Walmart, vary by category and which country the products come from.
- All tariffs are creating cost pressure but the largest tariffs on China have the biggest impact, McMillon said, adding “If it’s from China, obviously, it will have a higher amount.”
- “Well, if you’ve got a 30% tariff on something, you’re likely going to see double digits [in price increases],” Rainey later told Yahoo Finance,
Zoom in: Walmart wants to keep food and consumables prices “as low as we can,” he said, noting tariffs on countries like Costa Rica, Peru and Colombia are pressuring imported items like bananas, avocados and coffee.
- “Food prices in the U.S. have gone up in recent years, and our customers have been feeling that all along,” McMillon said. “We won’t let tariff-related cost pressure on some general merchandise items put pressure on food prices.”
- Ram Reddy, chief technology officer at Nagarro, a digital engineering company, told Axios he expects electronics and toys will be key categories where Walmart’s prices will increase….
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