Keen Shoe Company Stands Firm Amidst Tariffs, Promises No Price Hikes

Keen, a footwear company based in Portland, Oregon, has vowed not to hike prices despite steep new US tariffs on imports. The company has diversified its supply chain and reduced its dependence on Chinese manufacturing, preparing for trade uncertainties for over a decade. President Trump's tariffs are expected to hit footwear and apparel companies hard, with prices for consumers set to surge 70% in the short term.

Portland-based footwear company Keen has announced that it will not raise prices despite the recent steep US tariffs on imports. This decision is part of the company's long-term strategy to diversify its supply chain and reduce its dependence on Chinese manufacturing, a move that has prepared Keen for trade uncertainties over the past decade. The tariffs, imposed by President Trump, are expected to significantly impact footwear and apparel companies, with consumer prices potentially surging by up to 70% in the short term [1].

Keen's strategy to maintain stable pricing is a departure from the trend seen among other major footwear brands. For instance, Nike and Adidas have been among the companies that have asked for tariff exemptions, citing the substantial cost increases that could lead to closures of hundreds of businesses [2]. The Footwear Distributors and Retailers of America (FDRA), a trade group representing 76 footwear brands, has also urged President Trump to exempt shoes from reciprocal tariffs, claiming that the tariffs pose an "existential threat" to the footwear industry [3].

The tariffs, which include levies on goods from major US trading partners, have led to significant increases in costs for footwear companies. For example, the FDRA estimates that US footwear companies will face tariffs ranging between 150% and about 220% [3]. Apple Inc. and General Motors Co. have also disclosed financial projections showing substantial impacts from the tariffs, with GM expecting a $5 billion hit this year and Apple anticipating $900 million in higher costs in the current quarter [1].

Keen's decision to absorb the increased costs without raising prices is a testament to its supply chain diversification. By reducing its dependence on Chinese manufacturing, Keen has been able to mitigate the impact of tariffs on its operations. This strategy allows the company to maintain its competitive pricing while ensuring the availability of its products. As the industry braces for the impact of Trump's tariffs, Keen's approach offers a unique perspective on how companies can navigate trade uncertainties without compromising on affordability.

References:
[1] https://news.bloombergtax.com/financial-accounting/from-apple-to-gm-tariffs-to-cost-companies-tens-of-billions
[2] https://www.nbcconnecticut.com/news/business/money-report/footwear-giants-nike-adidas-and-others-ask-trump-for-tariff-exemption/3557160/?os=vbkn42tqhonripebn6refapp&ref=app
[3] https://www.livemint.com/companies/nike-adidas-skechers-and-73-other-footwear-brands-urged-donald-trump-for-tariff-exemption-amid-fears-of-rising-costs-11746237655711.html