🧦Tariffs for Dummies
Nike's 3D Air Max, The Fall Color, Shopping will be more Expensive, NANGA Japan, Chromakopia, Arvin Goods...
Arvin News
Happy Sunday,
Don’t worry we don’t think you’re a dummy. We deal in sourcing and importing or exporting every day, so TARIFF is not an new word for us. But, we are realizing after the US election that many people do not know exactly what it is or how it can affect the goods they buy. Many also don’t know that we have been paying an inflated tariff structure for over 6 years. We figured this was a good topic for today’s new letter.
We manufacture products in many places. China, Korea, Japan, Canada, Portugal, and the US. All of these countries have different pros and cons. Strengths and weaknesses. Advantages and disadvantages. When it comes to products in the apparel space, none of them are the same, and ALL of them are far from perfect.
Here is the tariff for a pair of socks in each location. This percentage is added to the base cost of the product at the time of import (or purchase). The tariff is paid by the importer (us) to US customs.
China - 13.5 + 7.5% (first Trump tariff, down from 25%)
Korea - 0% (Free trade agreement)
Portugal - 13.5%
Japan - 13.5%
US - 0%
Canada - 0%
FOB (origin) costs for a basic crew sock from all of these countries vary dramatically depending on volume and materials. But it is safe to say that China is the cheapest, and the price climbs from there. President Trump put additional tariffs in place on Chinese goods around 2018 during his first term. If politics were true🤣, then President Biden would have eliminated these, but he didn’t, and that’s because the government benefits from the added revenue. By definition, a tariff is a tax, period. This is not a “punishment” to another country; it is a tax paid by an importer, and if they are increased, the importer either has to absorb this in their COGS or pass it along to their customer. This is not a political statement; this is an economic fact, and the consumer pays that cost. It is also a fact that many other countries, especially developing countries, are cheaper and, in some cases, more skilled to produce certain products. This is very true in apparel. For example, we make our tees in the US; they retail for $48. Safe to say we sell fewer tees than big imported companies who can sell a similar on-trend tee for $10, or $15.
We have great relationships with our partners, foreign and domestic. We have our own opinions on presidents and policies, but at the end of the day running a business is all about understanding how changes in the market can affect your bottom line. A drastic change to the trade and tariff structure will not make things cheaper in the short term, it could, however, drive some innovation in domestic countries in the long term, but no matter what it will increase the costs of goods in the market. Since the beginning of Arvin Goods, we have said the way to make change is to vote with your wallet. If you cheer for increased import tariffs and then complain when prices rise you need to find a better understanding of how this all works. There needs to be balance in trade, and more importantly balance in sustainability, and labor rights, in some cases that may require driving some manufacturing back to the US, or other “developed” nations, but don’t be fooled to think that any of these places, US included is perfect, or better than the others. There are many layers to this system, and the best thing you can do is to be informed.
Have a great week!
Hope you enjoy today’s Clean Up. We would love to hear from you. Comment here on substack hit us on social, or email us at info@arvingoods.com. Have a great week. Cheers,
Team AG ✌️🧦
Stories Of The Week…
Design
Nike Reveals 3D-Printed Air Max Shoe for ComplexCon - Complex
Over 250 brands are converging at the Las Vegas Convention Center this weekend for the latest installment of ComplexCon, including global sportswear brand Nike.
The Swoosh has just announced its plans for the two-day experience, which will include the unveiling of its 3D-printed Nike Air Max 1000 shoe (pictured above). Produced in partnership with 3D-printing company Zellerfeld, the silhouette is essentially a reimagined version of the classic Air Max 1. The shoe will be on display at the Air Max 1000 Experience space, where attendees will have an opportunity to win a pair.
"As an innovator, what's most exciting to me about the Air Max 1000 are the new solutions we can achieve with next-level manufacturing," John Hoke, Nike's chief innovation officer, said. "It's control, times precision, times expression — all of which are vital to sport and to design. When those variables of control, precision and expression are multiplied at once, the future of our product really does feel unlimited."🖨️👟
Fashion
Our Predictions Came True: This Will Be Fall 2024's Biggest Color Trend - Who What Wear
If you ask me, color trends are the best trends. And since they're not dictated by climate, you can start wearing them before many of the other upcoming trends for a given season. We predicted this fall's biggest color trend way back in October 2023, and guess what? We were right. It's burgundy that's emerged as *the* color to wear, and even though the rich, elegant hue is typically thought to be a fall color, people have been embracing it all summer long. It's a strong indication that it's really going to be everywhere when autumn rolls around.
The first indication of the bright future of burgundy was actually on the S/S 24 runways, where Gucci and Bottega Veneta, among others, laid the groundwork. Even more brands jumped on the oxblood bandwagon with their F/W 24 collections, including Prada and Ferragamo. Additionally, burgundy has been all over the red carpet and my Instagram feed as of late, and every time I check a site's new arrivals, there are new burgundy goods to shop. So yes, we were right. In celebration, let's shop.💃🧵
Industry
Is Shopping for Clothes About to Get More Expensive Under Trump? - The CUT
If you’re thinking about doom spending, you might want to do it now. In recent days, several CEOs of fashion and beauty brands have spoken publicly of their concerns about one of the central points of Donald Trump’s reelection campaign: steep, widespread tariffs that many economists say will push up the prices on everything from bikes to couches to, yes, fashion. What will these taxes mean for shoppers when we’ve already seen many clothing brands become more expensive, often while feeling disappointingly cheap? Here’s what we know so far.
What even is a tariff?
A tariff is a tax on imported goods paid to the federal government by the company importing the goods. Trump loves tariffs (he calls himself “Tariff Man”), and during his first administration, he introduced many taxes on imported goods, especially from China, escalating a trade war.
But Trump’s first tariffs were tame in comparison to what he says he has planned now. In the run-up to the 2024 election, Trump promised to introduce a 60 to 100 percent tax on imports from China and a 10 to 20 percent tax on imports from all other countries.💸🚚📦
Brands We Love
NANGA
This is a brand we really really love. Japanese design and production. The highest quality from concept to product.
FROM NANGA SITE:
Our company was established in 1941 and founded by Akira Yokota. The company name, “NANGA”, originated from the Himalayan mountain “NANGA PARBAT”. The mountain stands at 8,126 meters and is the ninth highest mountain in the world. What separates this mountain from others is that it is notoriously difficult to climb, contributed to numerous deaths, and has the nickname of “Killer Mountain”. Our philosophy behind “NANGA” is to produce a create a product that can overcome challenges under the most drastic conditions. Throughout our history of over 74 years, we have demonstrated extra care and attention to details to produce quality clothing, sleeping bags, and down jackets.🪿🧗🏔️
Entertainment
MASK IS OFF: CHROMAKOPIA - YouTube
New Tyler, The Creator album Chromakopia dropped recently. Once again he has gone in his own direction and puts out one of the most adventurous, and unique albums of the year. Do not ever assume you know what he is going to come with, he always seems to be miles ahead of the norm. Catch it here:
'The Clean Up' is a weekly newsletter that mixes in some Arvin Goods news, products, as well as stories we saw during the week that are worth a share. From books to podcasts, sustainability to business news, we try to keep it interesting, and fun. If you are not a subscriber, sign up and join everyone who receives The Clean Up directly in their inbox every Sunday.