- About 60% of shoppers say they’ll adjust which retailers they shop at if the Trump Administration’s proposed tariffs on Chinese imports go into effect, according to a survey from rewards app Shopkick. The company surveyed more than 30,000 of its app users.
- Of those surveyed, 44% said they would cut back on shopping, while 25% would switch to buying products made in America. Twenty-nine percent of shoppers said they are stocking up on goods now.
- Generationally, 74% of baby boomers are aware of the tariffs compared to only 34% of Gen Z. Forty percent of millennials said they think tariffs will cost their household up to $500 over the course of a year.
Despite uncertainty over whether or not tariffs will be implemented, consumers are aware of the potential hit to their wallets, and they are planning accordingly. American retailers are making whatever adjustments they can, but many will still have to pass along some of the costs to shoppers if tariffs hit.
The latest 10% tariff set to be imposed on Chinese imports September 1 could have a strong impact on a wide range of categories including toys, clothes, shoes, electronics and other consumer goods.
Retailers like Walmart, Target and Costco that sell general merchandise, apparel and other nonfoods appear to be the most vulnerable to price increases. But according to investment firm Moody's, these companies have diversified their supply chains and, apparently in anticipation of further tariffs, pre-purchased goods.
Moody's analyst Charlie O'Shea wrote in a note Monday that these major retailers also have significant sway with vendors and can absorb price increases in the short-term.
While food retailers expressed significant concern over proposed tariffs on Mexican imports earlier this summer, which were ultimately suspended, tariffs on Chinese goods won't hit the grocery industry as hard as other retail categories. The previous tariff proposal focused heavily on produce, particularly avocados and tomatoes.
Looked at a different way, the shopping adjustments consumers make as a result of tariffs could prove to be an opportunity for grocers. Dropping prices on home goods and general merchandise could snag customers looking for a price break.