As the trade war with China continues to evolve, another round of increased tariffs is fast-approaching. While raising the tariffs on Chinese imports may have its benefits to the United States government, U.S. manufacturers that rely heavily on materials from China are taking the biggest hit yet.
Since these materials are necessary to manufacture certain products, tariffs are challenging the pre-existing cash flow of these businesses. The tax burden continues to transfer, creating a ripple effect through the supply chain, leading manufactures to ultimately displace the cost to the end consumer.
Essentially, it is now more expensive to import goods from China. Although the tariffs have not been around long enough to expose major effects on consumers, the impending fallout is inevitable. The more tax these businesses encounter, the less likely they can absorb a compounding cost.
WHAT MANUFACTURERS DID NOT PREPARE FOR
If you started a recognition business in the past ten years, chances are you source many of your awards materials from China. Whether you are sourcing metal or crystal, Chinese materials have had a consistently lower cost than most countries, including America.
A previous advantage of the low cost of sourcing and importing materials from China is that consumers can buy products at a cheaper