Retailers Cautious in Descriptions of Tariff-Related Price Increases
Retailers are reportedly trying to answer questions about tariff-related price increases without mentioning price increases.
They are doing so as they try to tell investors that they are taking steps to reduce the impact of higher costs, while also aiming to avoid scaring off shoppers with talk of price increases, the Wall Street Journal (WSJ) reported Friday (May 30).
The WSJ pointed to retailers that avoided saying they were raising prices by instead saying they were “adjusting” prices, making strategic decisions around promotions or “flexing the pricing power” of their brands.
Other retailers sought to minimize the magnitude of price increases by saying the increases were “surgical,” applied “gently and sparingly” or “strategic, selective and staggered,” according to the report.
The strategy of these retailers differs from others included in an April report by Bloomberg.
That report found that some retailers were being “uncharacteristically blunt” in sharing with customers the impact U.S. tariffs were having on the prices of their products.
Bloomberg cited one company that told its customers that it could not avoid raising prices because of the tariffs. Another that told customers that prices hikes were “unfortunately unavoidable” due to the tariffs, and a third that sent its customers a list of products comparing their prices before and after the tariffs.
In April, the WSJ reported that companies across industries were issuing new fees in response to U.S. tariffs together with the message: Please don’t blame us.
The report said some businesses were adding flat fees, while others were charging their customers a percentage of the subtotal.
The WSJ reported on one retailer who said that “transparency is the way to go here” and said he would add a “Trump Liberation Tariff” to orders, and another merchant said he told customers that he hated to increase prices, “but the tariff situation is beyond our control.”
Among America’s mid-sized firms, over 90% expect material shortages or shipping delays due to the impact of tariffs, according to the PYMNTS Intelligence report, “The Enterprise Reset: Navigating Tariffs, Supply Chain Shifts and Cost Pressures.”
The report found that the fallout from these expectations is an ongoing overhaul of operational strategies.
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