The tariff threat by US President elect Trump has raised concerns throughout the retail industry. Gary Millerchip, the CFO of Costco, one of the largest membership based warehouse supermarkets in the United States, has become the latest retail executive to warn that Trump's tariffs will increase consumer costs.
During the recent earnings conference call, Millerchip told analysts that "there is still a lot of uncertainty about the timing and scope of the (tariff policy) changes," making the specific impact difficult to predict.
However, he admitted that overall, "tariffs will increase costs, so we don't think it's a good thing
When bad things happen, more bad things often follow, "he added.
Trump previously proposed imposing a universal tariff of 10% -20% on imported goods from all countries and a tariff of 60% -100% on goods from China. Trump also stated that after taking office, he will issue an executive order imposing a 25% tariff on goods from Mexico and Canada.
Millerchip stated that opening customers had already stocked up on goods in advance, partly due to "lower predictability of sea transportation times" and "a certain risk of strikes". He also stated that he will strive to cooperate with suppliers to find ways to reduce costs.
As Trump is about to return to the White House, major retail companies in the United States have issued warnings about potential tariff policies.
John David Rainey, the chief financial officer of Wal Mart, the largest retailer in the United States, warned last month that Trump might have to raise the price of some goods if the tariff proposed by him came into effect.
Last month, American home retail giant Lowe's also discussed the risks posed by the tariff proposal when announcing its performance. During the earnings conference call, Brandon Sink, Chief Financial Officer of Lowe's, stated that approximately 40% of the company's product costs come from outside the United States, and tariffs "will definitely increase product costs.
Earlier this month, US dollar tree giant Dollar Tree stated that tariffs may force the deep discount chain to raise prices and completely stop selling certain products.