Trump’s imposition of tariffs on Chinese products attracted a retaliatory tariff hike by China on American products. The latest victim of this trade war is the average American consumer as Walmart in a statement said that it would increase prices on the items that are imported from China. The leading American retailer noted that it was trying to keep the prices as low as possible, but customers may still have to pay more.
Walmart, announced its best sales performance in the first quarter in close to a decade, did not issue any comments on the items that will be affected by the price hike. Many leading retailers, including the likes of Macy’s, have said that if another round of tariff hikes is imposed, then the prices of both the national and store products is bound to increase. In the next few days, many retailers like Target, J.C. Penny, etc. are reporting their first quarter results and their growth expectations which will indicate which way they plan to proceed to tackle the issue.
Despite the retailer’s comment on an increase in the prices, Walmart should be majorly hit by the tariff war as most of the items it sells in its stores are not imported. Its leading business is groceries, and the company is least likely to be affected when compared to other retailers like Amazon and Target, who import most of the items from China. Many analysts believe that it is suitable for Walmart in the long-run as it gives them a chance to change and focus more on American made items.
Walmart till now had no impact despite many tariff increases China has faced as the company was more focused on agricultural and industrial products. Trump last week imposed taxes on furniture and is likely to extend it on a wide range of products which can impact the retailers’ customers who are mostly looking for deals. The company said that it is working with its partners to cushion the blow but did not specify what. It is also finding many innovative ways to cut costs and also improve efficiency. It has opened a store where cameras are placed, which helps to tracks items that need to be refilled. Walmart is also focusing on its e-commerce business and has launched free next day delivery service on its popular products in a few select cities, and by the end of the year to most of the country.