logo
Why Brands Are Still Betting on the US

Why Brands Are Still Betting on the US

Serena Uziyel isn't giving up on the US.
Over the last year, the Istanbul-based luxury shoe brand has opened two stores in Florida and one in New York in what is now its second-largest market after Turkey. The brand hopes to open more stores in Florida, as well as new markets like California and Texas.
Those plans were made before the Trump administration unleashed its tariffs, and when the US economy was on more solid footing. But the brand has no intention of changing course now.
'We know how to deal with it, so we are not going to change our plans,' said chief executive Nadir Celik. It helps that the brand has experience navigating economic turbulence and high inflation in Turkey, he added.
Countless brands are making their own assessment of whether trying for a slice of the world's biggest fashion market is still worth the investment. All signs point to a weak economy with consumer confidence plummeting as the costs for essential goods like eggs go up. Retail sales on discretionary items fell in April. Trump's trade policy is also in flux, with the Supreme Court potentially weighing in on whether he can impose tariffs on dozens of countries on top of a 10 percent global levy that went into effect in April.
Investing in America could be a costly mistake in a worst case scenario, where Trump imposes prohibitive tariffs, the economy enters a deep recession, or both. But missing out if the turbulence is milder than expected has its own costs. Brands operating in the US are moving quickly to protect themselves, such as by reconfiguring their supply chains to minimise potential tariffs, or operating on parallel tracks, growing their US presence while speeding up expansion elsewhere.
For many, the choice to stay is clear – the market is simply too big to ignore.
'America as an economy is too important to be canceled,' said the Switzerland-based designer Philipp Plein.
'People have money to spend; people will keep on spending money.' A Resilient Market
Philipp Plein International Group is going ahead with a number of US store openings for its Plein Sport activewear brand, as it looks to at least double sales for that business to $40 million, Plein said. The line is made in China, where Trump has slapped 30 percent duties on all products, but he's betting that the tariff uproar won't be as detrimental as many fear.
He's even more confident in the American consumer. He noted the country's economy bounced back quickly after Covid compared to other leading economies like China, which has struggled to recover from the pandemic.
Brands are also banking on customer loyalty to get them through a potential rough patch.
When it comes to customers, 'once we get, them we keep them,' said Peta Heinsen, co-founder and director of the Australian womenswear brand Matteau.
Heinsen said the label aims to have more than half its sales come from the US, up from 35 percent today. If US customers replicate a 70 percent global repeat purchase rate, they'll get there, tariffs or no tariffs, Heinsen said.
The more that happens in the US, 'we can see huge potential without having to do too much more than we're already doing,' she said. Supply Chain Alignment
Where brands are changing course, it's often behind the scenes.
Ever-changing tariffs have underscored the need for brands to have a global supply chain — particularly one that isn't wholly dependent on China. The more suppliers and factories in its network, the more flexible a brand can be in relocating production when the cost of doing business increases.
Diversified supply chains will help in most tariff scenarios, experts say. Several brand founders cited Portugal, Turkey and India as countries with relatively low manufacturing costs that were likely to dodge the highest tariffs.
In February, Matteau moved production of its swimwear line from China to Portugal, sidestepping the roller coaster ride in April and May that saw tariffs on Chinese imports set as high as 145 percent before temporarily settling at their current level. (Whether the brand's bet pays off in the long run remains to be seen; in late May, Trump threatened a 50 percent tariff on goods from the European Union).
After moving into 1,700 Target stores, supplement maker Imaraïs Beauty is in talks to move production of its gummy supplements from Canada to the US so it can keep its big new retail customer consistently supplied without having to pay tariffs.
'As a brand, and a brand owner, you're putting out fires nonstop,' said co-founder and chief executive Aaron Hefter. 'This is a forest fire.'
With a trade war still brewing and consumer sentiment in flux, brands have to move forward with their growth plans while minimising any threats to their business, said Anshuman Jaiswal, chief business officer at software firm OnePint, which helps global businesses manage inventory.
'The only thing that you can control is, 'Can I have more risk cushion in my business plan?'' Jaiswal said.
Orange background

Try Our AI Features

Explore what Daily8 AI can do for you:

Comments

No comments yet...

Related Articles

New forever stamp honors Former President Jimmy Carter
New forever stamp honors Former President Jimmy Carter

American Press

time29 minutes ago

  • American Press

New forever stamp honors Former President Jimmy Carter

Special to the American Press The U.S. Postal Service announced on Aug. 16, that a commemorative forever stamp will be issued honoring former President Jimmy Carter, who died Dec. 29, 2024, at the age of 100. The Postal Service plans to release the stamp for purchase on Oct. 1 in Atlanta, on what would have been former President Carter's 101st birthday. Representatives of the Friends of Jimmy Carter, the National Park Service and the U.S. Postal Service unveiled the stamp art on August 16, at the Jimmy Carter National Historical Park in Plains. 'The stamp program celebrates the best in American culture, places and people, and it is difficult to consider a more fitting honoree than former President Jimmy Carter. In his support and leadership of his beloved community, state, and nation, he lent his quiet, thoughtful and deliberate energy around causes he believed in, and most certainly in his conduct and accomplishments as a former President, Jimmy Carter truly personified the best in America. I am honored to participate in the reveal of this stamp art which fully evokes his humanity,' said Peter Pastre the Postal Service's government relations and public policy vice president. Kim Carter Fuller, executive director of the Friends of Jimmy Carter said, 'The Carter family and the Friends of Jimmy Carter are honored to be able to take part in revealing the design for President Carter's Forever stamp. Together we've had the distinct privilege of a front row seat to his life and legacy, and today's reveal gives the world an opportunity to share his legacy with others on a daily basis.' From his origins in small-town Georgia, Carter came to the White House as an outsider who represented a new generation of progressive Southern politicians. Carter was inaugurated as the 39th president on Jan. 20, 1977. During his term Carter would make humility and reconciliation recurring themes in his presidency. Carter made a mark with his appointments of many women and minorities to government positions. He created a presidential commission on mental health, established new cabinet departments, and greatly increased the size of the National Park System and federally designated wilderness areas. Mindful of the nation's fiscal position, he was deeply concerned with trying to balance the federal budget and control inflation. In his efforts to improve the economy, he ushered through deregulation in several industries, including energy and air travel. On the world stage, Carter was praised for personally negotiating the Camp David Accords, providing a framework for peace in the Middle East. He signed SALT II, a treaty with the Soviet Union to limit strategic nuclear arms, and he initiated a major change in foreign policy when he announced that the United States would officially recognize and establish formal diplomatic relations with the People's Republic of China. After leaving the presidency, Carter became a prominent activist for peace, human rights and social and economic progress around the world. In 1982, he partnered with Emory University to establish the Carter Center, which advances democracy, monitors elections, mediates disputes and works to prevent tropical diseases in the world's poorest nations. In recognition of his efforts, he received the Nobel Peace Prize in 2002 — cementing his reputation as one of the most active and impactful former presidents. The stamp art is a 1982 oil-on-linen painting created as a life study by artist Herbert E. Abrams (1921-2003) in preparation for painting his official White House portrait. Ethel Kessler, an art director for USPS, designed the stamp.

Judge issues injunction preventing FTC from investigating watchdog Media Matters
Judge issues injunction preventing FTC from investigating watchdog Media Matters

Los Angeles Times

time29 minutes ago

  • Los Angeles Times

Judge issues injunction preventing FTC from investigating watchdog Media Matters

A federal judge has issued an injunction preventing the Trump administration's Federal Trade Commission from investigating Media Matters for America, the liberal media watchdog group that had alleged the spread of hate speech on X since Elon Musk acquired the social media platform. U.S. District Court Judge Sparkle L. Sooknanan ruled Friday that the FTC's probe of Media Matters, 'purportedly to investigate an advertiser boycott concerning social media platforms,' represents a clear violation of the group's freedom of speech. 'It should alarm all Americans when the government retaliates against individuals or organizations for engaging in constitutionally protected public debate,' Sooknanan wrote. Even before the FTC got involved, Media Matters has been defending itself against a lawsuit by Musk following the organization's November 2023 story that, following Musk's purchase of the social media site once known as Twitter, antisemitic posts and other offensive content were appearing next to advertisements there. Sooknanan said the injunction halting any FTC probe was merited because Media Matters is likely to succeed on its claim that the FTC is being used to retaliate against it for a critical article on a Trump supporter. 'The court's ruling demonstrates the importance of fighting over folding, which far too many are doing when confronted with intimidation from the Trump administration,' said Angelo Carusone, chairman and president of Media Matters. There was no immediate comment from an FTC spokesman.

Andrew Tate sues Meta and TikTok for ‘deplatforming'
Andrew Tate sues Meta and TikTok for ‘deplatforming'

The Hill

time29 minutes ago

  • The Hill

Andrew Tate sues Meta and TikTok for ‘deplatforming'

Conservative influencer Andrew Tate and his brother, Tristan Tate, are suing Meta and TikTok over what they describe as the 'unlawful and politically motivated decision' to deplatform the pair on their social media sites. The Tate brothers, who were banned from TikTok and Meta's Instagram and Facebook in 2022, filed lawsuits against both companies last week, alleging a 'coordinated campaign to suppress, silence, and destroy the reputations and livelihoods' of the two men. 'This campaign was carried out not merely by private actors, but in concert with government officials, media operatives, and ideological pressure groups—thus transforming Meta into a state actor for purposes of constitutional liability,' the filing reads. A similar statement also appears in the TikTok lawsuit. The brothers argue that the banning of their accounts amounts to a breach of contract and caused substantial financial losses, bringing a dozen claims against both Meta and TikTok. They dispute the companies' rationales for banning them, arguing that claims they promoted dangerous individuals or incited misogyny 'lacked substantiation and were unsupported by adjudicated findings.' Andrew Tate is a self-described misogynist. Meta declined to comment. TikTok did not immediately respond to The Hill's request for comment. The Tate brothers, who are dual American and British citizens, face various charges in both the United Kingdom and Romania. British prosecutors charged both men with rape, human trafficking and actual bodily harm in May. Andrew Tate is also accused of controlling prostitution by the U.K. authorities. They face similar charges of human trafficking and sexual misconduct in Romania. The brothers have denied any wrongdoing. They returned to the U.S. earlier this year, where they received a chilly reception. After they landed in Miami in February, the Florida attorney general launched an investigation into the two men.

DOWNLOAD THE APP

Get Started Now: Download the App

Ready to dive into a world of global content with local flavor? Download Daily8 app today from your preferred app store and start exploring.
app-storeplay-store