A Wall Street Journal article centered on one American company’s claimed uncertainty regarding adjusting its supply chain to no longer be in the People’s Republic of China cited this:
American Outdoor Brands spent months coming up with a plan to minimize the pain of tariffs. Now it is stuck waiting to see where to go.
Most of American Outdoor Brands’ products, which range from fishing tools to hunting gear and pizza ovens, come from China. Executives were prepared to reposition the company’s supply chain ahead of July 9, when the so-called reciprocal tariffs were set to take effect, betting that it could move quickly to reduce any pain points once the new levies kicked in.
But President Trump’s decision last week to extend the deadline for trade deal negotiations to August 1 has prolonged the uncertainty for many companies. That means American Outdoor Brands’ supply-chain reshuffling plan remains on ice.
Why? Where’s the uncertainty? These companies—not just American Outdoor Brands—still know they need to move their supply chains out of the PRC. At worst, they just have more time in which to do so.
American Outdoor Brands’ CFO Andy Fulmer:
We’re very comfortable that we’ve done all the upfront work on where we’d go by product category. We’re just kind of waiting for those firm rates to come out.
Stop dithering, then, and execute. The likely range of tariffs already is well-known, and they’re unlikely to be raised in the face of intransigence; they’ll just go into effect on the deadline, or be delayed again.
In the meantime, there are a myriad other places from which to source intermediate components and—in American Outdoor Brands’ and others similarly situated—final products. Bangladesh, comes to mind, as does Jordan. And manufacturing-experienced Vietnam, Republic of Korea, Japan, Philippines. It would be easy enough in those latter cases to contractually require components not come from the PRC directly or indirectly.
Even move the supply chains to…the United States.
