What a lot of companies are really saying is, you know, I don’t know what the next thing is going to be that disrupts supply chain. I just know there will be one that I’m positive of. So what we see really kind of market leading in companies is really, you know, thinking about innovation technology, using systemic learning to really say, okay, I can’t necessarily predict what will happen, but I can react faster.

Retail Unwrapped is a weekly podcast hosted by Shelly Cohan from the Robin Report. Each episode dives into the latest trends and developments in the retail industry. Join them as they discuss interesting topics and interview industry leaders. Keeping you in the loop with everything retail.

Hi everyone, and thanks for joining our weekly podcast. I’m Shelley Cohan and I’m very excited to welcome Sonia Chapman. She’s one of my favorite people to have on the podcast. She’s a licensed. Custom House broker, which is unbelievable, and an associate professor in the Department of International Trade and Marketing at Fashion Institute of Technology, which is of course part of suny.

We also are very privileged to have Ken O’Brien, CEO, and President of Gemini Shippers Group, who has a extreme deep expertise in transportation warehousing infrastructure. So I.

So welcome. Thanks for inviting us. Yeah, great to be. Well, I’m sure our audience, just based on my introduction of both of you can tell, we’re gonna talk about tariffs. But today we’re gonna focus on tariff whiplash, as we call it. Um, so we will be unpacking the twist and turns of the Trump administration’s tariff declarations.

So buckle up as we dive into policy roller disruptions. Economic curve balls that are being thrown at us. So Sonya and Ken are going help me unpack this ever changing tariff shifting landscape, which is really disrupting supply change and making it very difficult for retailers, kind of strategize, uh, and formulate a plan.

So we’re gonna go ahead and jump right in. And uh, I just wanna start with kind of where I just mentioned this unpredictability. So all these tariff announcements. They are rapidly changing and so retailers are having to respond to that. So Sonya, I’d love for you to talk a little bit about the impact on that with sourcing strategies, especially on the cost side of the business.

Okay, well, uh, importers, whether they’re wholesalers or retailers, um, have to plan their lines in advance. And when they book orders, they have to do it assuming certain conditions and customs duties and transportation costs are all part of that picture, and when tariffs are imposed overnight. And then conseque consequence.

Retaliation tariffs are also imposed, um, while production is in mid-process. It’s an immediate hit to all parties involved, so it’s the factories are, are taking a hit. The, the importers and retailers that are involved are, and, and ultimately it’s the consumer as well. So while many companies have been working on moving production outside of China, when we look at current exports, uh, I mean imports, excuse me, or exports from China, imports into the us the data through March 25 shows that units.

From China still represent over 35% of our apparel imports. Um, and I think that’s fairly consistent across most other, you know, consumables, uh, that we import from China. Um, and. In the apparel market that is more than the combined imports from the next four largest suppliers to the us. Wow. So we’re talking Vietnam, Bangladesh, India, Cambodia.

And that doesn’t even account for the direct to consumer shipments that come from. China that are not recorded with the same detail as goods that are processed via typical customs entry. Um, so we do see increased imports from the Western hemisphere trading partners like Honduras, Mexico, and Nicaragua, which are all.

Taking advantage of FTAs, but the relative volume is small and so to, in the, in the mass market, um, you know, that is the worst of what we’re seeing. And so I can kind of share, uh, what sourcing professionals have told me is that when they’ve placed their goods in China and they have these rapid changes, they just can’t shift that fast.

They just can’t. So they are. Working with their suppliers to get better pricing. And uh, when it goes back and forth, then their suppliers return to them and say, well, we gave back more than we want to. Your tariffs are lower now. But those same importers are saying, wait a second. We know you gave us this big to, uh, you know, cut because of the terrace, but we don’t know where shipping is going.

And, you know, we don’t know what those costs are, the warehouses going because we’re stopping and starting. And we went through that during COVID and we saw costs that we didn’t expect. So I’m gonna hand it off to, uh, Ken here to kind of respond to that side of it. Uh, well, one word answer. Yes. Uh, you know, every, everything you said, Sonya agree and, and everything that affects production ultimately is, is exactly the same on the transportation side.

You know, I, I use the analogy sometimes I’ll date myself a little bit. The I Love Lucy episode with the chocolates and everyone’s seen it. Everyone knows it, and it explains it. You know, the transportation system, that network is really, it’s just like a production line. And so we have. Weekly sailings coming across the Pacific, bringing these imports in.

And so when we either start or stop them or speed them up or slow them down, of course the network can’t respond quick enough. And that’s where Lucy starts eating lots of chocolates. And so, you know what we saw just recently, right? Tariff announcement comes, many, many importers don’t know what to do.

Should I hold an origin? Should I ship, try and hold here? Should I go and try and very quickly sh shift to another factory? That just creates that disruptive force. And how quickly can that network, that fixed network start to respond. And so things you think about, you know, that, that, you know, probably importers aren’t worried about, but their transportation providers are certainly that that pickup slow down, right?

Those ships go every week. And so that space, if unused doesn’t come back right, we don’t get it back. And so if people say, I didn’t ship from China for three weeks, that’s three weeks of China’s imports that now have to find their way back at some point. Or we switch sourcing. Well, to your point, the same thing about the scale from China to, you know, the rest of Southeast Asia, the production system is, is also scaled.

So is the transportation network. And so taking away 5% of China and just putting it into Malaysia, it doesn’t work from a ship network side. And then the last part really that people really don’t think about on the import side is the flow of the empty containers have to go back, right? For every box that comes in, we gotta get the back for the.

One of two things can happen. One, if we’re, we’re, we’ve been putting boxes back to China for the, you know, that’s where most of them go because that’s where the most of the imports come from still. And so there’s, there’s empty sitting in China that maybe we need to get down to Vietnam. That’s time and money.

And then also just the fact that longer voyages, longer time that comes to ships, containers, and the like, it just takes more of it. And we saw that. The best example you could say is, you know, as we had to divert ships around the Red Sea. It takes about two extra ships for every loop to do the same number of boxes per year, just ’cause they’re going farther.

Ken, I’m certainly not a shipping expert. I spent some time in logistics at Macy’s, but I took care of trucks once they hit, hit the dc. Um, so that was the easy part of the transportation logistics. But a question I have for you, you talked about this empty container problem because we had that during the pandemic and it was a nightmare.

You had containers in the wrong parts of the world. So just in layman terms, so a container coming in from China that comes to the US maybe New York. That doesn’t necessarily mean that that container’s going back the same direction. Correct. Correct. Yeah. So I mean, the way you would typically think about it is you have to balance the system at a system level, not at an individual container level or even a port pair level, but eventually, however many you sent in, you have to get them back out and eventually you need to get them back out to where the next layer of demand gonna, and again, just like the, the imports.

You can’t certainly overmatch. Once the ship is full, it’s full. You can’t keep going. And so as you get behind, there’s almost no ability to catch up until demand drops on the import side and then you can start to overmatch sending the empties home and so and so, it really does become very quickly a breakdown in machine and COVID.

I think where you saw it. As we filled our dcs, all of a sudden the cycle time on the landside got longer. There was nowhere to put the stuff. It stayed in the containers and so that container wasn’t available to get flowed back to Asia. And that’s how we started to get into that perpetual cycle of I may have a slot, not a box, I have a box, not a slot.

And it lasted, you know, you think, we always say a day of disruption is a week to recover. That’s right. And you think of what we, what we just did. We, we really from China put three full weeks of disruption into the system. 15 calendar days. You could argue that’s 15 b, that that is just such a complex system.

And I think one of the things that, um, I’ve been hearing and talking a lot about is the small retailers really have been struggling more. They don’t have the ability to pivot as quickly. They don’t have the deep pockets. So maybe, uh, Sonia, you wanna talk a little bit about that? Well, as you said, there’s a number of reasons.

Limited financial resources being one of them. They have narrower production networks. They’re not as diversified as the larger guys. Um, they have less bargaining power, you know, because they’re offering smaller volumes and. Is only one component of the supply chain. Uh, high volume, uh, low cost product needs, material efficiency.

Um. Logistical efficiency and low labor costs. And while some countries have lower labor costs than China, what they lack is the productivity level that China has. So even when we can make the switch and the price is lower, we’re just not turning out, you know, what we need. And you know, um. And so for smaller retailers, they obviously, they feel that so much harder.

They have less ability to move. They don’t have the finances to up, you know, hold up under this. But even the larger retailers are, you know, are suffering greatly. And to give you an example is if we look at a discount retailer like Walmart. So they have orders that are millions of units, and when tariffs in China were pushed to over 145% over the standard tariff rate, they paused production in China and they tried a rapid shift to Vietnam and Bangladesh and over overall they invested, you know, in the eight figure range to, you know, to make that happen.

But. The Vietnamese and Bangladeshi factories, they struggled with their volumes. They could only produce about two thirds of what was needed and other issues like shipping delays. You know, Ken mentioned the longer transit times, all of those impacted supply. And so once there was a pause in the tariffs, they restarted production in China and they relegated Vietnam and Bangladesh suppliers back.

To a secondary role because Walmart can raise prices, but they can’t have empty shelves. That’s right. That’s right. And let’s talk about pricing strategies. And Ken, I’m gonna start with you first because we know that all this complexity and the supply chain, transportation, warehousing costs, that’s all driving up the cost side of the imports that we’re bringing in.

So what’s going on Are company, are you seeing companies absorb this? Are you seeing them pass it along? Sure. You know, I, I think it’s very similar to, you know, just the, the straight tariff increases, you know, transportation prices, you know, same model. There’s only so much absorption you can do before you, you, you run out of money.

Um, and so when you think of what, you know, the typical wholesale retail margins are, we’re starting to get to the point where many, many goods, you’d say, okay, I’ve, I just paid my tariff and now I have more transportation. And, and you know, for, for what we tell when we negotiate, you know, so Gemini, you know, we’re.

We’re negotiating these freight contracts on behalf of our 350 member companies, each with its own price sensitivity and elasticity. And so for some there might be more margin and they might be able to absorb more. Others, work on very thin margins. And you know, what we try and tell the carriers is, you know, the last thing you really would want to do is drive someone to where they can’t ship at all.

Right? You know, supply and demand is what it is, and, and at the end of the day, there is probably no better industry than transportation that responds to price, you know, sensitivity with supply and demand. As soon as the utilizations go up, spot rates come up with it. But when you start to get to the point where you then start to destroy demand through price.

It’s pretty self-defeating. And so, you know, one of the things, I think the container, as great as it is since 1956 when we invented it, we start to forget what’s in the container, right? And so, you know what, what a, what a, you know, cell phone can handle for a price increase is different than a pair of socks.

And so, you know, what we try and, you know, instill in our carriers is, you know, eventually you’re gonna need the sock shipper two. So, you know, you cannot put him out of business. You really have to try and, you know, maintain, and of course, you know, it’s not their job to make sure that these companies are profitable or not, but they do need them as customers.

And so, you know, finding that right balance point, uh, really just takes a lot of re open communication, you know, and, and really talking through, you know, where is this going to ultimately destroy demand, which is good for no one. At the end of the day, it’s. The importers and it’s not good for the ocean carriers.

Um, you know, having ships and no cargo, just as painful as, you know, cargo and enough ships, um, both sides have to work to the middle. Exactly. And oh my, I didn’t realize that We’ve been using containers for only 70 years. Like, yeah, that’s pretty interesting. 1956 invented right here in the United States of America.

Yay. Alright, so, and I wanna go back to something Sonia, you said about, uh, you got into a little bit about the discount retailers. So we all know that the different segments of our retail industry operate on different margins of luxury sectors, have higher, you know, gross margins and companies like Dollar General and some of those.

Extreme discounters, um, have very, very thin margins. So are you seeing differences in terms of how we’re handling price sensitivity based on the segment of the business luxury, for example, versus discount. Well, uh, you know, obviously there are major differences between the two markets and one of the major differences is price elasticity.

Um, you know, a 10% price hike doesn’t deter the luxury consumer, but it does. Impact an aspirational consumer. Um, but a 5% increase for discount sum consumer can de, you know, deter or even stop the purchase. So, high net worth individual that wants, you know, a Louis Vuitton bag, a price jump doesn’t stop them.

Aspirational buyers, you know, are. Will move to lower cost brands, maybe like a coach, um, or, you know, we are definitely seeing a bump in the resale market, you know, where that, you know, where consumers who are looking for that are saying, well, maybe I’ll buy something that’s in good shape and use and save myself a little bit of money there that way.

Um. Also luxury shoppers definitely have brand loyalty while budget conscious consumers are not brand driven or you know, we could call them brand agnostics. You know, as far as that goes. Um, and they, and also within the luxury market themselves, they have so much higher margins. Um, you know, I think we’ve seen a little bit of, uh, un uh, unwanted transparency that’s been kind of showing up online for, you know, for some of those brands.

Um, but it does let them absorb some of those costs. They can still stay highly profitable. Whereas, you know, when we see the budget conscious, um. You know, sellers, they are really struggling to, to make it on the margins that exist today. So we, we are seeing those distinctions. Interesting. And I know there’s like this whole unintended consequences based on everything that we’ve talked about so far on global trade relationships.

So can you talk a little bit about this ripple effect beyond just our US borders? Um, yeah, of course. Um, you know, so one of the things that we see is that. Uh, you know, there are other sectors that are impacted and we may not think of it as something that’s going to impact, impact retail specifically, or, you know, the import market as a whole, but it definitely, you know, it definitely does happen.

Um, so. Us exporters to China, which are, you know, largely agricultural markets. You know, they’re, they have suffered, you know, ter terribly and by being hit by the retaliatory tar har, right. And, you know, and quite frankly, the scale of China’s imports can’t be matched. So when they go to diversify, they can replace some of it.

But that’s really being eaten up by other markets. You know, Brazil and Argentina have been the beneficiaries of, you know, of that pain. Um, but those are still, you know, US workers, US consumers that. Spend in our retail markets that are being harmed and when they recover back, they don’t fully take back that market.

Um, and that’s a challenge us brands face, you know, discrimination and boycotts, not only in China, but now across the globe. Because, you know, originally China was irritated by being targeted, but. In our tariff whiplash situation, we seem to have gone all over and, uh, nobody is being spared. And so we have, you know, issues of that, you know, people walking away, uh, the consumers walking away from the US brands, um, and even within China themselves, they’re classifying, uh, PVH, Tommy Hill.

Fat Figures brand as an unreliable entity, which means that they can be hit with, you know, fines or outright bans, um, or, you know, on their products or investment, you know, in the country. So it’s really, really difficult and. Then even so as we exhibit this unbalanced state, you know, where we flip flop like this, and especially with the attacks that took place, you know, uh, against our trading, our key trading partners, Mexico and Canada, you know, for FTAs to thrive and, and foster investment, you know, there has to be long-term stability and or that doesn’t happen.

And so. Actions like that create uncertainty. And so what we get is a paralyzed state where, uh, you know, and, and Ken’s experiencing that too. We don’t wanna ship because three weeks later it cost us, you know, a hundred percent less. And so we’re seeing that really across the board in all of our activities.

And so multiple industries that are being harmed. So a, you know, agriculture is just one example. There are definitely others, you know, um, you know, are. Apple, you know, apple brand within, you know, within China’s being harmed. I think it’s really coming across the board of their is a great irritation with the United States for destabilizing a trade system that we developed.

Right. You know, so, um, that’s, that’s where, uh, you know, that’s where I see it headed. You know, one, one of the things that. So you, you know, mentioned, you know, the, the US AG export, which is, you know, it’s, it’s, it’s our biggest segment other than recyclables. You know, essentially for, for every container that’s imported in the United States, you know, half the container goes back out full.

And so you, you know, you think about also as that US AG slows down, that means less full containers, which means more empty containers, which means more cost. And so. That works into the, into the operating budget of the carrier, which eventually, you know, can, can reappear as cost for imports. And so there’s an inflationary cycle there.

And, and at the end of the day, you know, you’re, you’re right Sonya, you know, the, the, the pig eating in Brazil doesn’t care if his soy meal came from the United States or.

In those commodity business, you know, the margins, it’s much more price sensitive and in many cases there is an alternative market. And so the minute we add cost to a US-based market, you know, ultimately we’re just seeding the market to someone else up until where they run on the supply. And, you know, I take the soybeans and, and the ag side is a great example of the unintended consequence of this and the ripple and how quickly it could affect, you know, multiple things in in supply chain.

And, and even, you know, one of the things that, um, I mentioned earlier, you know, we don’t really count or see de minimis the same way we see, uh, statistics on imports elsewhere. But in the retail se, you know, sector, the increasing prices at our discount retailers are driving consumers to direct to consumer.

Platforms, you know, they’re partially responsible for the success of Shian and Tim. Um, and you know. And also their sales have been harmed inside China. ’cause these retailers not only wanna sell to consumers in the us we’re not the only consumers out there. Right. They wanna sell to consumers in China.

And so far, you know, since the, the original tariffs that went in during the first Trump administration. Walmart ended closing AP appro approximately 20 stores, you know, in China through 2003. And they’ve refocused on other parts of Southeast Asia, but they have yet to come back to their 2 17 20 17 retail sales le level in the region.

So this is just, um, you know, this is just really unbalancing us once again. Yeah. And it is a big balancing act, uh, everything that we’re talking about. So what, what are some opportunities? I mean, y’all are in the field, you see it every day, you’re living it. Um, what are you seeing in terms of innovations?

Are there, uh, retail strategies that some retailers or brands should be thinking about? Is there, you know, sourcing technologies that can help with this? Is AI a partner in all this? So, you know, I. Since COVID, certainly, you know, most US companies have have accepted the fact that they, you know, the, the risk premium is significant, right

And so the risk of losing a sale, um, you know, the, the impact of e-commerce and, you know, a sale that you missed today, you know, doesn’t only mean you missed a sale. You might miss a customer at that point. And so that need to have that product where you want it, and the right product at the right time, I think has really.

I think COVID reinforced that as you have an unstable system, you, you introduce all sorts of systemic risks to your business if you can’t plan. And so, you know, I always say with my team, you know, we can’t, you know, we can’t manage what we can’t measure. And so it always starts with data and, and insight there.

But, you know, I was talking with, with one of our members the other day and I said, you know, I’ve never met a person who laments paying their car insurance and then says, oh darn, I didn’t have an accident. Get to use it. The truth is, you know, we have to, that’s true. You have to invest some money, um, in becoming resilient.

And there’s a lot, you know, I just wrote a, a, a post on it the other day about building and resiliency. I think what, what, what a lot of companies are really saying is, you know, I don’t know what the next thing is going to be that disrupts supply chain. I just know there will be one that I’m positive of.

So what we see really kind of market leading in companies is really, you know, thinking about innovation, technology, using systemic learning to really say, okay, I can’t necessarily predict what will happen, but I can react faster. And speed really matters. You know, it’s when people say, oh, if you said today I am gonna switch to Vietnam, you’re only too late.

’cause a thousand people have already done that. And so, you know, being, having first mover advantage means that you’ve already kind of. A, you’ve done some of this thinking before time is to, you know, playbook, booking out, what would I do if B is building a system that does have some redundancy and resiliency into it?

And then I think really the ability to react quickly. And I think that’s really not only about systems, but about people training and really partnerships. And so, you know, I know companies now they’re saying, oh, my Chinese factory also has a place in Mauritius and I can go if I have not done that work ahead of time.

It’s already too late. And so that making those investments, you know, buying the insurance ahead of time, uh, it doesn’t feel great when we all write the check to, uh, to our favorite insurance company, but we’re sure glad we have it when the accident comes, aren’t we? And so that’s what we see. Um, absolutely.

I agree. You know, we, we can’t create production facilities overnight, um, and everyone who’s impacted is competing for the existing production capacity. So those companies that, you know, at a certain point understood that, you know, this was a potential issue. Who made the early move to, you know, be more flexible and, and diversify are, you know, are going to do better.

But I also think that we’re gonna have to have some creative moves to keep the supply chain moving. Uh, part of it is going to be streaming up. Processes and, uh, cut overhead and that was gonna happen whether there was a tariff war or not. AI and increasing in technological advancements and all the data that we have right now are already doing that.

Um, so we, you know, we were already looking at, you know, the sample process and you know, now it’s just trend to, you know, to production is they’re really trying to streamline that. Um, at this point in time. So, but I also think that, you know, we’ll have to see certain things that will return to some of the tactics that were employed prior to the elimination of quotas where companies may still use Chinese inputs, um, as a major portion of their products, but a range for the origin conferring process to occur outside of China.

Um, and so we could see, um. Just the certain types of things. We could see the fabric production and the cutting take place in China, but the sewing origin take place outside. I see. Um, in another market. Um, you know, certainly even the Chinese understood some of this was gonna happen, and as you said, they’ve been investing in Martia, they’ve been in investing, um, in Africa as well, you know, for production facilities there.

So I think that we’re going see that. And then finally, you know. The tariffs are creating enough of a disturbance and you know, more familiar markets that. Some of the FTAs that weren’t as attractive may be that way. I think some of what we’re gonna see is, you know, higher priced items, less production and you know, uh, the, the story that the president said of, you know, we might have to make due with $2 dollars instead of 30 may apply to our dresses and shirts and pants and shoes as well.

Right. I know that, uh, I know that coming outta the pandemic we had, um, I, I, I believe that a lot of retailers and brands pivoted very quickly to talk about diversified supply chain. And I hate using the word chain. ’cause it goes back to what Ken said about the chain. The one link breaks and then boom, you know, people have to have a network.

But, um, so like. Yeti, for example. Those are two great brands that have really worked hard to diversify all of their production. But they started this, I think Yeti started before the pandemic. Uh, looking at that, so you have these companies ahead. I mean, do, do you think companies, as the tariffs hit, are, were they more prepared for this than back in 2020?

Uh, from my perspective, I’m gonna say that I was some pitfall. Pre 2020 tariffs would’ve prevented this from kind of occurring in the way that it did. I don’t think any was, anyone was expecting 145% tariffs from a major, you know, on a major supplier and to a major market for us companies. So I don’t, I, I don’t know that.

There was a better preparation for it. In fact, I, I kind of see these pauses and Ken and I discussed this a little bit the other day and you could kind of talk about if you’re seeing it as well, is as an ability to let companies kind of react to that right now and fill in and make sure that they survive this bump.

By getting their orders in as quickly as possible, which means that we’re gonna have an insane peak season. Um, I think you mentioned it as a big, huge bell.

So I, you know, but I think that when you don’t have as many choices as you, you know, it, it’s, it’s very sophomoric to say that, oh, just move. It doesn’t happen like that. You know, these are long-term processes. So I, I think there was some hope that there would be respect for what the impact was previously.

But now, you know, we have to live with the situation as it is, you know, until it changes. I would say it really depends on the goods and, and, you know, two things. One, what sort of tooling is required to, to make it so, you know, we do, we have a lot of our members are in the automotive space where there’s big break drums and presses, and that’s not so easy to move.

And then really also, you know, underlying raw material. If, if you’re reliant on the steel. Your raw, your raw material ultimately was coming from China. And so you have a, a whole secondary raw material supply chain that had to be built up to get those raw materials to this, you know, this other place to then start to, you know, do the production start.

And so I think, you know, and the other part was, you know, even with the first set of tariffs and, and President Trump’s first term, which carried right through the entire Biden administration for the most part. Um, in some cases China was still the right mathematical answer. And so. The right math said there’s a cost to diversifying, there’s a cost for insurance.

I’d rather not pay that cost today. I’m just gonna stick with what’s worked for the last 30 years. And so some companies made an economic decision to say, this is, this is still gonna get me the best immediate return. Um, and I won’t diversify. Other, other companies. We saw they left China in, you know, 2018 and they, they didn’t go back.

Um, but I think, you know, there was no right size fits all. And I think it’s, it’s not correct. I’ve heard people say, well, that was irresponsible. There’s a lot more that goes into this beyond, you know, the stuff that we deal with, um, that makes those decisions happen for those companies. Um, and so I, I think, you know, it really is a, it’s, it’s, it’s unique to each, each, and every, every firm.

Well, one last question I have for both of you is this whole idea of bringing manufacturing back to the US and you have companies, I don’t know if you know Bayard Winther, the uh, CEO of American Giant. It’s one of my favorite brands, but his whole company is based on the premise of producing here in the us I mean from the ground up, you know, from his, you know, father and you know, all of that.

So he built his whole company understanding that everything is gonna be made in the, so now you have these companies that. Thinking about, so is that realistic? Can you change production to made in the us? And even if you are doing that or partial that, could you market that? And would that appeal to kind of these consumers that are tired of paying these higher prices due to tariffs?

Well, you know, patriotism sells, you know, we, we do know that that’s a marketing, you know, tactic. You, I hear it now in the Walmart advertisements that, you know, because Walmart gets accused of, you know, really skewing things. But, and they’ll always mention, you know, how many of their suppliers are small American companies or.

Goods that have some component of production within the United States and that they’re supporting them through their stores. And, you know, and I, I think that if production there is, you know, some incentive to do that. Build those facilities is gonna take some foreign input. So, you know, we’re back in our little, you know, tar back on our tariff wheel there again.

I’m glad you mentioned, uh, American Giant, um, because companies like them, they can grab and. You know, they sell a $40 t-shirt over a ten one, and they have an appealing story. They have a reliable inventory and they have a stable price point. You know what you’re gonna from them. But once again, we’re talking about a smaller market

Right. And so I think when we talk about, we’ve become used to lots of inexpensive goods being available to us, and you know, if I stain this T-shirt, I can throw it out and just get another one because I could get four or I could get one. You know, so, right. Um, I think it really will depend. Is that viable?

It depends on how much disposable income we have, you know? Uh, so I, because you have to be able to pay for your patriotism. Tan. Any closing thoughts on this? You know, I, I, I, I think, well, some things come back to United States should they, are there strategic reasons why we want some things to come back to United States?

Short things tied to defense, aerospace. Um, highly tooled thing. You know, the automotive industry where it’s, it’s super high levels of automation where we have the actual raw materials are coming from the United States. So there’s lots of, there’s lots of yeses in, you know, I think, right. Um, is the. $1 t-shirt on wo coming back to the United States.

I think the answer is of course no. And, and it shouldn’t. And maybe that t-shirt shouldn’t exist in the first place. Somewhat argue. Um, I think certainly as, as someone who, you know, myself, my family, for as long as I can remember, made business on shipping as a, as our, as our livelihood. I hope it never all goes away.

Um, but I do think that, you know, there is certain segments. They didn’t leave that long ago. The furniture industry, you know, there is, you know, we still make furniture in the United States. There’s places where we have it, and so where we can have a workforce, you know, I think that the other part is do we have enough people to man all these factories, right?

Um, there is, there is some static limit there. Um, but I think, so if there’s anything that’s come from this, this kind of recent trade spat. It’s maybe really reassessing what, what is the right answers for certain companies? And, and there are probably some industries that, you know, I think we will see migrate, you know, more back towards the US semiconductors maybe, potentially.

Um, which are strategic. And then there’s others that you’d say, you know, that is, that is not only capitalism, but that’s, you know, that’s economics. Um, and, and really going to the low cost producer that is the right specialization. That’s Adam.

Again, those broad statements bring everything home is, is probably not, uh, probably not gonna happen, and that’s probably. So the one kind of resonating message here is balance, balance, balance. So thank you Sonya. Thank you, Ken. I’m our audience. Learned a lot today, so thank you for that. Um, always a pleasure to have you guys come on.

Uh, retail unwrapped and, um, boy, I think we could probably carry on this conversation for another three hours and maybe another three weeks or so because it’s just ongoing. So thank you so much. Thank you for listening to Retail Unwrapped. We’ll be back in one week with another podcast. Please subscribe on Apple Podcasts, Spotify, or any podcast.

Service. If you have questions, ideas for a podcast or anything else, please contact us via the robin reports.com.