Although some breathed a (small) sigh of relief when Trump put a 90-day pause on his non-China tariff policies, the make-or-break moment will not be three months from now, but in the next three weeks. That’s because we’re entering the critical phase when retail orders for the holiday season must be finalized and processed. This is when companies hit the “buy” button.
More retail business is done in the fourth quarter than in any other time of the year, and every sector of the home industry has different lead times. For some product categories, the time has already passed to get orders in for the holidays—especially when it comes to purely seasonal goods like Christmas ornaments, many orders for which were placed at the winter trade shows.
That’s why with the ongoing chaos of the Trump tariff situation, any company on either the retail or wholesale side that imports products is getting night sweats knowing it has to commit to plans now—or risk not having anything to sell in December.
Prices on holiday orders were set back before the change in administration, and before even Trump’s harshest critics thought he would put forth trade measures as drastic as they’ve turned out to be. Now, vendors, their overseas factories and their customers have to go back to the negotiating table to figure out new pricing structures. Those conversations are going to be quite awkward—and maybe even ugly.
Importers who used to put down small deposits to guarantee shipments—paying the balances after delivery on standard terms—are now being asked to pay the entire purchasing price upfront. Factories in China don’t trust that purchasers won’t just abandon the orders at the factory, leaving vendors holding the bag (or the container). Same goes for freight companies that don’t want to have unpaid shipping loads stuck on their ships because the importer refused to accept delivery.
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Then there’s the faster-turn merchandise, which may not be as seasonally dependent, and which represents a substantial percentage of the home business. These are where the buy-button activities are about to happen … or not. Importers keep waiting for some relief, tracking the latest rumors and speculation, hanging on every word from Trump administration officials even as the president himself gives little indication that he will change his mind (again).
Whatever eventually happens, one thing is almost certain: Prices on goods for the fourth quarter, regardless of what they are and where they come from, will be higher than a year ago. What impact this will have on sales is unknown, but history has shown that higher prices rarely result in higher business.
Whatever one believes, whichever party one belongs to, however many goods you have tied up in all of this: It’s coming to a head in the next 21 days. Do nothing and your store will be empty. Even worse, do the wrong thing and you could be out of business.
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Warren Shoulberg is the former editor in chief for several leading B2B publications. He has been a guest lecturer at the Columbia University Graduate School of Business; received honors from the International Furnishings and Design Association and the Fashion Institute of Technology; and been cited by The Wall Street Journal, The New York Times, The Washington Post, CNN and other media as a leading industry expert. His Retail Watch columns offer deep industry insights on major markets and product categories.