Walmart’s CFO, John David Rainey, recently shared with CNBC that the retailer might have to raise prices on some products if President-elect Donald Trump’s proposed tariffs go into effect.
Rainey explained that Walmart’s goal is to keep prices low for customers, but in some cases, price hikes may be unavoidable. However, it’s too early to say exactly which products could get more expensive due to the tariffs.
This comment comes as Walmart has been doing well, surpassing Wall Street’s expectations and raising its forecast for the year. At the same time, Lowe’s CEO Marvin Ellison expressed concerns about the proposed tariffs and their potential to raise costs for the home improvement retailer. Lowe’s has already started talking to suppliers about what could happen if the tariffs are put in place.
These concerns are part of a broader warning from major retailers about how the proposed tariffs could impact prices for consumers. During his campaign, Trump mentioned imposing tariffs of 10% to 20% on all imports, with some items from China facing even higher duties.
Lowe’s CFO, Brandon Sink, pointed out that about 40% of the company’s goods come from outside the U.S., so higher tariffs would definitely increase costs. He emphasized that the details of these tariffs are still unclear, but the company is already planning for different scenarios.
Like other retailers, Lowe’s is keeping a close eye on the situation and working with suppliers to figure out how to respond if the tariffs take effect.
This isn’t just a concern for Walmart and Lowe’s. Other companies like E.l.f. Beauty and footwear maker Steve Madden have also warned that they might need to raise prices if tariffs are imposed. Steve Madden is even planning to cut back on the amount of goods it imports from China to avoid higher costs.
Walmart, however, has less to worry about than some other retailers since most of the products it sells are made, grown, or assembled in the U.S. In fact, two-thirds of the items Walmart sells are made here in the States. But even so, the company is still trying to source products from different parts of the world to avoid being overly reliant on one country like China.
Rainey also mentioned that Walmart has already been adjusting to the impact of tariffs for the past seven years. While they try to keep prices low, higher tariffs would still lead to price increases for customers. Walmart is working with suppliers and focusing on its own private brand products to help keep prices down as much as possible.
