Tariffs have been an extremely prevalent issue for many brands this year.
One of the most challenging aspects of it so far this year has been the uncertainty and constant change in tariff policy, and the way that brands have responded to these fluctuating tariffs has varied from brand to brand.
What has been true, regardless of any changes in policy, is that these tariffs have brought on increased costs for wholesale brands, and by extension to their consumers.
Many brands might still be wondering just how much to raise their prices, and how to go about it, so we figured we’d provide some tips based on discussions we’ve had with brands and retailers.
Transparency is going to be a key factor in maintaining your strong retailer relationships during these uncertain, and challenging, times.
The video above shows a retailer on one of our recent webinars talking about one way she’s seen some brands display tariff price increases.
She said that she’s seen brands simply list the tariff increase as a line item on their invoices.
She added that she appreciated this method of displaying the price increase (Base Price: $50 + Tariff: $5 = Total: $55) because it gave her some assurance that this price increase is directly tied to a temporary external cost and wouldn’t be a permanent markup.
Retailers value knowing exactly which items are affected by the tariffs and where they’re manufactured.
Here’s a list you can reference to provide a quick look at what prices would be important for your retailers to know about due to notable apparel tariffs:
China: ~30%
Vietnam: ~46%
Bangladesh: ~37%
Cambodia: ~49%
India: Up to 50%
Sri Lanka: ~30%
European Union: ~15–20%
Indonesia: ~19–32%
Pakistan: ~19–30%
Turkey: ~10%
Canada: ~35%
Brazil: ~50%
Taiwan: ~20%
Switzerland: ~39%
And you can also go to this webpage for a list that is constantly updated, since as we’ve mentioned, tariff policy is not as stable as we’d all appreciate.
If you’re able to provide a country of origin for your product or material, it makes it easier for your buyers to anticipate cost trends and adjust shelf mixes or pricing strategies accordingly.
For the footwear market, tariffs have so far bumped leather shoe prices by 39% and apparel by 37%, according to the Yale Budget Lab. Long-term hikes are expected to settle around 19% and 18%, respectively.
For a real-world example, Steve Madden raised wholesale and direct-to-consumer prices by about 10% to offset rising tariff burdens earlier this year.
Steve Madden’s increase appears to be in line with what industry analysis estimates clothing, shoe, glove, and similar products to go up in price due to this year’s tariffs.
While bigger brands and retailers might be able to absorb some of these increased costs for some time to limit the higher prices for end consumers, that won’t be true for brands and retailers that don’t have scale to their advantage.
Yes, tariffs are disrupting margins and pushing prices up across wholesale apparel and footwear categories.
Brands like Steve Madden have already raised prices, while we’re sure others are weighing their options.
But, brands that use transparency to explain why prices are increasing and build that into their systems will gain respect and retention from their retailers when margins inevitably shift again.
If you’re looking for help templating an invoice that reflects tariff costs as line items, then reach out to our team and we’d be happy to help.