Prices rise at Target and Best Buy because of Trump's customs duties

Von WOM

The two largest retailers of America, Target and Best Buy warned on Tuesday that the prices will increase on imported goods from Mexico, Canada and China due to the tariffs imposed by President Donald Trump.

expression of the tariffs and their effects

The comprehensive tariffs of 25% on goods from Mexico and Canada came into force on Tuesday. Trump Douplated In addition, customs on all Chinese imports to 20% of 10%. These import taxes are added to existing tariffs to hundreds of billions of dollars of Chinese goods. China and Canada immediately reacted to American products with tariffs, while Mexico is planning to also announce recovery.

price increases and goods offer

The Trump administration emphasizes that the tariffs are necessary to stop the influx of fentanyl to the United States. Nevertheless, these tariffs endanger the prices that the Americans for

Brian Cornell, CEO von Target, said in a interview with CNBC that the tariffs on Mexican products may force the company to increase the prices for fruit and vegetables this week. Cornell explained that Target was heavily dependent on Mexican fruit imports in winter: "These are categories where we will try to protect prices, but consumers will probably see price increases in the next few days," he said. Target also explained that the "customs uncertainties" will also have an impact on the profit in this quarter.

Best Buy expects similar developments

Best Buy also expects price increases due to the tariffs. China and Mexico are the main suppliers for consumer electronics at Best Buy. "We have never seen such a wide range of tariffs. Of course, this affects the entire industry," said Best Buy Ceo Corry Barry in a conversation with analysts on Tuesday. The company assumes that the providers will pass on some customs costs to retailers, which makes price increases for American consumers very likely.

decline in sales and consumer dissatisfaction

Target reported a decline in sales in February and expects sales to grow by only about 1% this year. Last month, sales were "weak" due to cold weather conditions, which influenced the expenses for clothing. "The falling consumer conconfidence has had a total of our range," said Jim Lee, head of finance of Target, in a statement.

In addition, Target is under pressure from consumers who are dissatisfied with the departure of the company from initiatives to diversity, equality and inclusion (dei). Days after Trump's taking office, Target To dissolve racial justice and make further changes in his diversity initiatives. However, the company emphasized that it continues to work "to create a feeling of belonging for our team, our guests and our communities" and that it is important to adapt to the changing external landscape.

reactions to Target's withdrawal of Dei-initiatives

Target's withdrawal has triggered outrage among progressive customers and led to boycott calls, especially on the part of Schwarzer "> Schwarzer Consumer . Rev. Jamal Bryant from the New Birth Missionary Baptist Church in Stonecrest, Georgia, called for 100,000 people to start a 40-day boycott against Target on Wednesday to start Lent. The participants are encouraged to buy products from black companies during this period.

There are signs that the repercussions of Target's decision influence the company. Customer visits to Target, Walmart and Costco have decreased in the past four weeks, whereby the decline at Target is most pronounced, according to Placer.ai, a company that uses location data for visiting. This slowdown could also be due to weather conditions, economic situation and other factors, warned Placer.ai.

for the week until February 17th, the last week, the foot traffic fell to Target by 7.9% and 5.2% to Walmart. At the same time, foot traffic rose to Costco, which adheres to its DEI policies, by 4.8%. The data "show a clear decline in traffic from the end of January to mid -February after the return of the company of Dei," said Joseph Feldman, analyst at Telsey Advisory Group, in a message to customers last week.

This story has been updated with additional context information and developments.