New Tariffs Bring Change: The Impact of Trump’s China Tradewar

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For the past several months, the impending trade war between the US and China has loomed. Political posturing has captured the attention of companies and consumers on both sides of the dispute. Effective September 24, President Donald Trump followed through with his threat to impose a 10% tariff on $34 billion of Chinese goods setting the stage for likely price increases on products and packaging for American retailers and consumers.

Joan Scheel, Impak’s Director of Logistics, said to be prepared for the cost of products made in China to rise. “The tariff will impact most packaging goods coming from China including paper and plastic products as well as articles made from textile materials like tote bags, pouches, cosmetic bags, backpacks and garment bags,” she said. “Tariffs also affect ribbons, woven labels and tins.” Joan works daily with Impak’s factories, forwarders and the project management team. She also finds solutions for when customers require storage and distribution for their products. When asked how the new tariff would affect products produced outside of China, she said packaging items made in Vietnam, India, Mexico and Europe will not be impacted by the tariff.

On August 1st , Impak CEO Eric P. Grossman sent a letter to customers addressing the development of the US and China trade war. The letter cautioned that the proposed tariff could increase to 25% in January 2019 and that any future increases or updates would follow. Impak’s customers who have been impacted by the September 24 increases have been contacted directly regarding the impact on their impending orders.

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“It is our understanding that the tariff will be applied to any shipments that have not cleared customs at the time it goes into effect,” Eric wrote. “We will continue to look for opportunities outside of China to bring our customers quality products at an affordable price.” While Impak already partners with factories in Vietnam, Mexico, and Europe, Joan added, “Impak will continue working with their long time partners in China to look at ways to reduce the cost to help offset some of this [tariff].” Joan further explained that Impak “feels these measures will help us to continue to grow and reassure our customers that we are forward thinking and a partner they can depend on for good products and good prices.”

Strengthening relationships with our forwarders - those who organize shipments for individuals or other companies and their brokerage team - is another key to successful importing, Joan explained. “Forwarders and their brokerage teams constantly keep up with possible changes that are happening in the importing industry,” Joan said. “Impak has several very experienced and well informed teams that we work with on ocean shipping, air cargo shipments, and domestic transportation. They are integral in developing solutions for our customer’s logistical needs.”

Stay tuned for future developments, and if you have any questions regarding current packaging orders or how tariffs could impact future orders, feel free to contact Impak’s Director of Logistics Joan Scheel at jbernice@impakretail.com.

Caleb Lummer