The world is under siege from the recent Trump tariffs. The economic impacts of these will be felt globally in the months ahead and it is anyone’s guess as to the outcome. I for one am in the camp that these are a trade negotiation tool attempting to level to business playing field for American companies.
Why are American goods taxed through tariffs into foreign countries when there is no duty imposed on imports from those countries? A simple question but a very difficult one to answer particularly when you consider poor Asian nations whose population can barely afford food and accommodation and certainly cannot afford an iPhone or a Tesla. Protecting their small industries may be a valid use of tariffs but this too is open to debate and not something that can easily be drawn to a conclusion.
At Boundary Supply we have always done the utmost to provide our clients with the highest quality product at the best possible prices. Our bags are designed within the USA at our headquarters in Salt Lake City, Utah. We have a proud American heritage and in keeping with this heritage, much of the fabric used in our packs and gear is made using American fabrics. Where possible we source American made materials and supplies used in the construction of the bags. As an example, the Xpac material, the predominant material used in our bags, is sourced from an American company, Dimension Polyant out of Putnam CT. This material stands the test of time and is head and shoulders above our competitors who mostly source cheaper material from Asian factories.
Where things get complicated is that this material, the designs and other American made items are then shipped to manufacturing plants in Asia to be assembled. Why Asia? There is no viable American alternative that we have found. We continue to look and would happily manufacture our packs and gear in the United States, but the cost and quality are not near that provided by Asian facilities. To keep the quality up we have been forced to use Asian manufacturers.
The products, once assembled, are then shipped back to the United States. A question then is are these American products? They use American designs, fabrics and other manufacturing inputs but are assembled in Asia so should this product, which in our eyes is uniquely American, be taxed an import duty or tariff as a foreign import? The answer per the US government is that the tariffs will be assessed on our bags as if they are Asian. I do not agree with this verdict as to me we are a quintessential American company with few alternatives for manufacturing so taxing these products seems wrong to me, but I will leave that argument for now and let the debate continue.
These tariffs tax the products by roughly 40%. We are not alone as all imports are being levied these fees but will these tariffs force prices to the consumer higher by 40% to offset this extra cost? Normally this kind of markup takes time to integrate into the system and ultimately be transferred to the consumer. Businesses know that raising prices right away by that large of an amount will destroy sales and the economy as the consumer cannot handle an instant bump in the price of the products of 40%. Your paycheck will not jump 40% next week to offset these tariffs! Over time, prices will increase if the tariffs are not removed quickly, and this will result in large scale inflation. As no one can stomach runaway inflation I expect these tariffs to be resolved in relatively short order.
During this turbulent time and until a formal decision is made to institute or remove the tariffs, we at Boundary Supply have committed keep our prices stable, absorbing the tariffs, bringing value to our clients and continuing to design and develop high quality American products. I thank you for your continued support of our company and I look forward to putting these tariff wars behind us soon.
-Stephen Bick