How More Tariffs On China Will Impact American Companies | NBC News Now

AMERICAN COMPANIES? WE SAT DOWN WITH THE CEO OF A WE SAT DOWN WITH THE CEO OF A CLOTHING COMPANY TO FIND OUT CLOTHING COMPANY TO FIND OUT

WHAT IS YOUR COMPANY? WHAT IS YOUR COMPANY? HOW WOULD OUR VIEWERS RECOGNIZE HOW WOULD OUR VIEWERS RECOGNIZE THIS BROND THIS BROND >> WE ARE A MEN’S LUXURY SHIRT >> WE ARE A MEN’S LUXURY SHIRT MAKER IN VIRGINIA MAKER IN VIRGINIA WE MAKE SHIRTS THAT FIT BETTER, WE MAKE SHIRTS THAT FIT BETTER, FEEL BETTER AND ALSO LONGER THAN FEEL BETTER AND ALSO LONGER THAN ANYTHING ELSE IN THE CLOSET

ANYTHING ELSE IN THE CLOSET WE DO THAT THROUGH E-COMMERCE WE DO THAT THROUGH E-COMMERCE 50,000 CUSTOMERS, NETWORK STORES 50,000 CUSTOMERS, NETWORK STORES AND RETAILERS ACROSS THE AND RETAILERS ACROSS THE COUNTRY COUNTRY

>> YOU HAVE BEEN AFFECTED BY >> YOU HAVE BEEN AFFECTED BY THIS ADMINISTRATION’S TARIFF THIS ADMINISTRATION’S TARIFF POLICY POLICY WALK ME THROUGH HOW YOU HAVE WALK ME THROUGH HOW YOU HAVE BEEN IMPACTED AND WHY? BEEN IMPACTED AND WHY? >> WE ARE A GLOBAL BUSINESS AND >> WE ARE A GLOBAL BUSINESS AND WE HAVE A GLOBAL SUPPLY CHAIN WE HAVE A GLOBAL SUPPLY CHAIN TARIFFS ARE A BIG ISSUE

TARIFFS ARE A BIG ISSUE WHAT IS INTERESTING IS WHEN WHAT IS INTERESTING IS WHEN PEOPLE THINK ABOUT THE NEW PEOPLE THINK ABOUT THE NEW TARIFFS RECENTLY, THERE IS ALL TARIFFS RECENTLY, THERE IS ALL THIS FREE TRADE AND NOW WE ARE THIS FREE TRADE AND NOW WE ARE ADDING TARIFFS TO IT ADDING TARIFFS TO IT IT IS NOT THE CASE PARTICULARLY IT IS NOT THE CASE PARTICULARLY IN THE SHIRT BUSINESS OR APPAREL IN THE SHIRT BUSINESS OR APPAREL BUSINESS, OUR TARIFFS ARE 195% BUSINESS, OUR TARIFFS ARE 19

5% ON EVERYTHING WE BRING IN ON EVERYTHING WE BRING IN IN MOST BUSINESSES THE AVERAGE IN MOST BUSINESSES THE AVERAGE IS 14 IS 1

4 >> PRETTY HIGH ALREADY >> PRETTY HIGH ALREADY >> THERE IS A HIGH BAR ALREADY >> THERE IS A HIGH BAR ALREADY WHAT WE ARE PAYING FOR THE WHAT WE ARE PAYING FOR THE TARIFF TARIFF

WE UNDERSTAND WE UNDERSTAND THAT’S PART OF IT THAT’S PART OF IT IT IS FINE, BUILT INTO THE IT IS FINE, BUILT INTO THE BUSINESS MODEL

BUSINESS MODEL I THINK THE CONCERN IS WHEN YOU I THINK THE CONCERN IS WHEN YOU ADD TARIFFS ON TOP OF THAT ADD TARIFFS ON TOP OF THAT >> SHARE HOW THE TARIFFS GAKTED >> SHARE HOW THE TARIFFS GAKTED YOU? YOU? WHAT DOES THE JUMP MEAN IF IT IS WHAT DOES THE JUMP MEAN IF IT IS 19 AND JUMPS TO 35? 19 AND JUMPS TO 35? >> TARIFFS AFFECT US >> TARIFFS AFFECT US

OBVIOUSLY, THE COST OBVIOUSLY, THE COST IT IS GOING TO MAKE THINGS GO UP IT IS GOING TO MAKE THINGS GO UP MORE MORE THAT’S MEANINGFUL

THAT’S MEANINGFUL OUR SHIRTS AVERAGE FROM $100 TO OUR SHIRTS AVERAGE FROM $100 TO $150 $150 THAT’S AN EXPENSIVE PRODUCT THAT’S AN EXPENSIVE PRODUCT

AN ADDITIONAL 15%AN TO OUR COST AN ADDITIONAL 15%AN TO OUR COST BASIS CAN BE CHALLENGING BASIS CAN BE CHALLENGING ANOTHER CHALLENGE, THE PRODUCT ANOTHER CHALLENGE, THE PRODUCT WE BROUGHT IN RECENTLY BEFORE WE BROUGHT IN RECENTLY BEFORE THE RECENT TARIFFS KICKED IN, THE RECENT TARIFFS KICKED IN, EVERYBODY WAS TRYING TO MOVE EVERYBODY WAS TRYING TO MOVE THINGS OUT OF CHINA BEFORE THE THINGS OUT OF CHINA BEFORE THE TARIFFS CAME IN SO SHIPPING TARIFFS CAME IN SO SHIPPING PRICES WENT UP PRICES WENT UP LASTLY WHEN TARIFFS HAPPEN IT IS LASTLY WHEN TARIFFS HAPPEN IT IS NOT ONLY WHAT HAPPENS TO US, BUT NOT ONLY WHAT HAPPENS TO US, BUT WHAT HAPPENS TO OUR SUPPLIERS

WHAT HAPPENS TO OUR SUPPLIERS WE ARE IN TURKEY WE ARE IN TURKEY THE AMAZING HIS TREMENDOUS OF THE AMAZING HIS TREMENDOUS OF CRAFTSMANSHIP IN TURKEY, CRAFTSMANSHIP IN TURKEY, PARTICULARLY IN THE SHIRT MAKING PARTICULARLY IN THE SHIRT MAKING BUSINESS BUSINESS

WHEN THE TARIFFS HIT LAST YEAR WHEN THE TARIFFS HIT LAST YEAR WITH TURKEY THEY WERE ON STEEL WITH TURKEY THEY WERE ON STEEL BUT IT DIDN’T AFFECT OUR SHIRT BUT IT DIDN’T AFFECT OUR SHIRT MAKING BUSINESS BUT BECAUSE THE MAKING BUSINESS BUT BECAUSE THE TURKISH ECONOMY WAS IN TURKISH ECONOMY WAS IN RECESSION, INVESTMENT LINES RECESSION, INVESTMENT LINES PULLED OUT PULLED OUT WHICH AFFECTS US DOWN THE LINE? WHICH AFFECTS US DOWN THE LINE? CONSIDERING THE MOVING TARTS, CONSIDERING THE MOVING TARTS, HOW UNPREDICTABLE THIS IS, WHAT HOW UNPREDICTABLE THIS IS, WHAT IS YOUR WORST CASE MAYORIO HOW IS YOUR WORST CASE MAYORIO HOW THIS COULD PLAY OUT? THIS COULD PLAY OUT? >> WE HAVE A 50% TARIFF IN >> WE HAVE A 50% TARIFF IN CHINA, A SMALLER PIECE OF OUR CHINA, A SMALLER PIECE OF OUR BUSINESS BUSINESS LET’S SAY MORE TARIFFS OCCUR IN LET’S SAY MORE TARIFFS OCCUR IN OTHER PLACES

OTHER PLACES >> LIKE TURKEY >> LIKE TURKEY >> IT COULD HAPPEN, PARTICULARLY >> IT COULD HAPPEN, PARTICULARLY GIVEN THE UNPREDICTABILITY OF GIVEN THE UNPREDICTABILITY OF WHAT IS HAPPENING NOW WHAT IS HAPPENING NOW

AT THE END OF THE DAY WE MAKE AN AT THE END OF THE DAY WE MAKE AN AMAZING PRODUCT AMAZING PRODUCT WE HAVE TO KEEP DOING THAT WE HAVE TO KEEP DOING THAT THAT’S PREDICTABLE

THAT’S PREDICTABLE WE SHOULD BE ABLE TO RUN THAT WE SHOULD BE ABLE TO RUN THAT BUSIER ON YEAR FOR THE NEXT TEN BUSIER ON YEAR FOR THE NEXT TEN YEARS BUT IF TARIFFS HAPPEN AND YEARS BUT IF TARIFFS HAPPEN AND WE NEED TO MOVE SUPPLY CHAINS WE NEED TO MOVE SUPPLY CHAINS THAT COULD FATHAUER BUSINESS THAT COULD FATHAUER BUSINESS FROM A SUPPLY CHAIN PERSPECTIVE FROM A SUPPLY CHAIN PERSPECTIVE BUT WHAT IF IT TAKES US A YEAR BUT WHAT IF IT TAKES US A YEAR TO MAKE A SHIRT AS GOOD AS WE TO MAKE A SHIRT AS GOOD AS WE MAKE IT IN TURKEY AT THE NEW MAKE IT IN TURKEY AT THE NEW POLICE POLICE

>> WHAT ARE THE CHALLENGES? >> WHAT ARE THE CHALLENGES? >> — YOU CAN’T MAKE IT HERE IN >> — YOU CAN’T MAKE IT HERE IN THE UNITED STATES THE UNITED STATES >> ONE IS THE COST >> ONE IS THE COST IT BECOMES MORE EXPENSIVE FOR IT BECOMES MORE EXPENSIVE FOR THE CUSTOMER

THE CUSTOMER THE OTHER THING IS THE ABILITY THE OTHER THING IS THE ABILITY OF FACTORIES TO PRODUCE THE OF FACTORIES TO PRODUCE THE CLOTHING VOLUME CLOTHING VOLUME IF 40 YEARS AGO WE WERE MAKING IF 40 YEARS AGO WE WERE MAKING 95% OF OUR CLOTHING AND TODAY WE 95% OF OUR CLOTHING AND TODAY WE ARE MAKING 3% ARE MAKING 3%

WE HAVE LOST GENERATIONS OF THE WE HAVE LOST GENERATIONS OF THE KNOW-HOW, PEOPLE WHO KNOW HOW TO KNOW-HOW, PEOPLE WHO KNOW HOW TO SEW, CRAFT PATTERNS SEW, CRAFT PATTERNS >> THAT’S SKILL SET >> THAT’S SKILL SET >> SKILL SET

>> SKILL SET WHEN WE ARE LOOKING AT AMERICAN WHEN WE ARE LOOKING AT AMERICAN MANUFACTURING, THERE IS SPOTS OF MANUFACTURING, THERE IS SPOTS OF STRENGTH FOR IT STRENGTH FOR IT BUT I THINK THE LARGE MASS SCALE BUT I THINK THE LARGE MASS SCALE PRODUCTION THAT WE ARE USED TO PRODUCTION THAT WE ARE USED TO TODAY IT IS DIFFICULT TO DO IN TODAY IT IS DIFFICULT TO DO IN THE UNITED STATES THE UNITED STATES

WE HAVE TO DO IT IN A MORE WE HAVE TO DO IT IN A MORE CREATIVE WAY CREATIVE WAY >> LET’S TALK ABOUT THE CONSUMER >> LET’S TALK ABOUT THE CONSUMER SIDE OF THINGS SIDE OF THINGS WHAT CAN PEOPLE EXPECT THIS WHAT CAN PEOPLE EXPECT THIS HOLIDAY SEASON, SHIRTS AND OTHER HOLIDAY SEASON, SHIRTS AND OTHER ITEMS WILL BE BOUGHT

ITEMS WILL BE BOUGHT WILL THE PRIGSS GO UP AROUND THE WILL THE PRIGSS GO UP AROUND THE HOLIDAYS HOLIDAYS >> THAT’S OBVIOUS >> THAT’S OBVIOUS

I THINK IT IS GOING TO BE I THINK IT IS GOING TO BE MARGINAL COMPARED TO WHAT MARGINAL COMPARED TO WHAT HAPPENS NEXT YEAR HAPPENS NEXT YEAR I THINK A LOT OF PEOPLE I THINK A LOT OF PEOPLE STOCKPILED SO I THINK THERE IS A STOCKPILED SO I THINK THERE IS A GRACE PERIOD GRACE PERIOD THE QUESTION IS DOES THE TRUMP THE QUESTION IS DOES THE TRUMP ADMINISTRATION DO THE CHINESE ADMINISTRATION DO THE CHINESE TARIFFS THROUGH THE NEW YEAR? TARIFFS THROUGH THE NEW YEAR? IN THE SUMMER, THE FALL, THAT’S IN THE SUMMER, THE FALL, THAT’S WHEN YOU SEE THINGS GO UP, 5, WHEN YOU SEE THINGS GO UP, 5, 10, $15

10, $15 WE ARE NOT RAISING PRICES YET WE ARE NOT RAISING PRICES YET >> YOU ARE FIRST AND GOAL THAT >> YOU ARE FIRST AND GOAL THAT COST RIGHT NOW? COST RIGHT NOW? WE ARE FEELING THAT WE ARE FEELING THAT

IT IS GOING TO SACRIFICE OUR IT IS GOING TO SACRIFICE OUR MARGIN FOR THE BUSINESS MARGIN FOR THE BUSINESS THAT’S SOMETHING THAT WE HAVE THAT’S SOMETHING THAT WE HAVE TRIED TO BUILD IN AS QUICKLY AS TRIED TO BUILD IN AS QUICKLY AS WE COULD REACT TO IT BUT WE ARE WE COULD REACT TO IT BUT WE ARE NOT NECESSARILY GOING TO BE NOT NECESSARILY GOING TO BE IF COUNTRIES GO FROM 15 TO 30 TO IF COUNTRIES GO FROM 15 TO 30 TO 35%, THAT WOULD BE DETRIMENTAL

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