Latest news with #DeborahWeinswig
Yahoo
14-05-2025
- Business
- Yahoo
As US, China Tariff Saga Takes Another Turn, Footwear Firms Are Bracing for Mid August: Here's Why
Footwear firms are digesting another twist and turn in Trump's trade negotiations following big moves by the U.S. and China to cut tariffs, at least temporarily. On Monday, the U.S. cut its tariffs on Chinese goods to 30 percent from 145 percent, while China went to 10 percent from 125 percent for U.S. products. Now the clock ticks anew with Aug. 14 as the new date to watch — also the end of the three-month freeze — when fashion and footwear firms need to get their goods on the water for the fall and holiday selling seasons. And while most items for back-to-school (BTS) need to ship before then for August sales, some goods for mid-to late September now get an extra week or two of breathing room on the shipping schedule. More from WWD Under Armour Moving in Right Direction Despite Still-challenging Results Shoe Prices Sank in April, the Sharpest Drop in 21 Months, Despite Uncertainty Around Tariffs Studio Nicholson Expands With Marylebone Store and Tmall Flagship So, who wins? 'Brands that have continued manufacturing and that have shipped containers of products to tax-free zones or bond warehouses are in great shape and will be capable of quickly pivoting to move product into the U.S. in time for back-to-school,' Coresight Research CEO Deborah Weinswig said. 'However, brands that pumped the brakes and hit pause on everything are going to need time and money to get people back to work and to get factories moving again.' For these brands, she noted that they may even incur added air freight costs to get goods into the U.S. in time for back-to-school. While the current freeze is temporary, the expectation is that continued talks over the next 90 days will lead to a new trade agreement between the two countries. The key footwear, fashion, and retail trade organizations — Footwear Distributors and Retailers of America, American Apparel and Footwear Association, National Retail Federation, and the Retail Industry and Leaders Association — saw the move as a step in the right direction, but also emphasized that the Trump administration had more work ahead to improve current trade policy. Wall Street analysts are keeping tabs too on the impact of the tariff pause, particularly because much of the footwear production is found primarily in China and Vietnam, followed by Indonesia and Cambodia. Earnings reports from Crocs Inc., Wolverine Worldwide Inc. and Steve Madden Ltd. last week saw the footwear firms pull their 2025 guidance due to the backdrop regarding uncertainties around tariffs. Wolverine's first quarter report indicated strength at its Saucony and Merrell brands. Given the firm's first quarter earnings and revenue beat and second quarter guidance in line with consensus, Williams Trading footwear and apparel analyst Sam Poser noted: 'We believe that Wolverine management would have raised its fiscal year 2025 guidance if they knew last week what they know today.' Poser noted that Wolverine will produce under 10 percent of its U.S. product in China this year, with China-sourced goods expected to be under five percent in fiscal year 2026. The Williams Trading analyst also upgraded shares of Steve Madden from 'Sell' to 'Hold,' with a price target of $31. Shares are currently trading in the $26 range. He noted that the reduced tariffs will ease pressure on Madden, specifically for some of its apparel production, and Kurt Geiger, the London-based brand acquisition that closed a week ago and still has about 80 percent sourcing out of China. Madden CEO Edward Rosenfeld said last week that the company moved aggressively to shift production out of China to Cambodia, Vietnam, Mexico and Brazil. But Poser also expects 'increased freight cost headwinds from shipments from Asia as the flow of goods and demand for containers increases due to the pause on China tariffs.' Two more companies on Tuesday reported quarterly earnings, On Holding AG and Under Armour Inc. Swiss athletic firm On posted a first quarter net income decline of 380 percent on a net sales gain of 43 percent, and raised its full-year 2025 net sales guidance, which incorporates the U.S. tariffs in place during the 90-day pause that was announced on Monday. Jefferies' Randal J. Konik has a 'hold' on shares of On. Footwear grew 41 percent in the quarter and apparel was up 93 percent. He noted that the company has built a solid business as a challenger brand in the athletic footwear market, achieving a 2 percent global share that's well above the industry growth rate. But as growth in footwear normalizes, the company's product breadth will need to expand, and the apparel line needs to show it can become much larger to move the market capitalization higher. Adjusting for tariff uncertainties, the company also lowered its gross margin expectation to between 60 percent to 60.5 percent from prior guidance of 60.5 percent. The company is looking to develop localized production capabilities to reduce reliance on regions affected by tariffs, Konik noted, adding that price increases in the U.S. on select items were on the agenda starting in July to 'maintain its premium positioning and offset costs.' On's co-CEO and CFO Martin Hoffman said during the company's earnings conference call that it continues to see 'strong consumer demand' for its products across all global markets. He said the pipeline in the second half has new product launches that include running product such as Cloudsurfer Max, Cloudflow 5 and Cloudboom Max. He spoke about tariffs and the impact on foreign exchange rates, and added that global trade policy shifts have added to planning uncertainty that includes the 'risk for increased tariffs and freight expenses, as well as general volatility within the global supply chain.' Under Armour reported a fourth quarter net loss of $67 million — the adjusted net loss was $35 million —for the period ended March 31, on a net sales decline of 11 percent to $1.2 billion. Both apparel and footwear revenue were down, falling 11 percent to $780 million and down 17 percent to $282 million, respectively. Accessories revenue was down 2 percent to $92 million. Cristina Fernández at Telsey Advisory Group said the early read on results were mixed, although the company did a 'good job reducing promotions.' She noted that the company needs to change the perception of the brand, attract more consumers and gain shelf space at wholesale accounts. BMO Capital Markets analyst Simeon Siegel said 'changes in tariff policy are not expected to significantly impact' Under Armour's first quarter ended June 30. Mitigation strategies include potential cost-sharing with key suppliers, diversifying sourcing, and reviewing targeted price adjustments to protect margins. Siegel said 30 percent of goods are sourced from Vietnam, 20 percent from Jordan, 15 percent from Indonesia and the balance spread across multiple countries. During Under Armour's earnings conference call on Tuesday, company president, CEO and founder Kevin Plank said the company's priorities for fall '25 include winning in apparel, unlocking the full potential in footwear, and strengthening its connection with women starting with essentials, such as bras and bottoms. Plank also spoke about the upcoming UA Halo collection, representing a premium expansion into 'next generation performance sportswear.' He said the UA Halo launch will begin with three distinct footwear offerings—trainer, runner and racer—with each designed to meet specific athlete needs. Best of WWD Mikey Madison's Elegant Red Carpet Shoe Style [PHOTOS] Julia Fox's Sleekest and Boldest Shoe Looks Over the Years [Photos] Crocs Collaborations From Celebrities & Big Brands You Should Know Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
CNBC
06-05-2025
- Business
- CNBC
Temu and Shein face massive tariffs. But don't count them out of the U.S. e-tail scene, experts say
The closure of a trade loophole and prohibitive tariffs on China have upended Temu and Shein's business model in the United States. And yet the e-commerce companies are likely to remain a dominant force in American online retailing, experts suggest. On Friday, the de minimis rule — a policy that had exempted U.S. imports worth $800 from trade tariffs — officially closed for shipments from China. This has seen Temu and Shein exposed to duties as high as 120% or a flat fee of $100, set to rise to $200 in June. The small-package tariff exemption had been key to the companies' ability to maintain budget prices on the merchandise they ship from China. Now that its gone, prices on Temu and Shein have been surging, with the former ending direct shipments from outside the U.S. altogether. The change will be welcomed by many detractors of de minimis, among them U.S. lawmakers, labor unions and retailers, who have argued that Temu and Shein abused the exemption to undercut local businesses and flood the country with illicit and counterfeit products. But despite the new trade challenges that Temu and Shein face ecommerce and supply chain experts told CNBC that the companies are still capable of competing with their rivals in the U.S. "Don't count them out ... Not at all. These kinds of Chinese e-commerce apps are very adept and agile. They have contingency plans in place and have taken the necessary steps to cover the tariffs from a margin perspective," said Deborah Weinswig, CEO and founder of Coresight Research. "I personally believe, if anything, [America's e-commerce] game has been accelerating in favor of Temu and Shein ... I wouldn't be surprised if the competitiveness gap actually continues to widen," added Weinswig, whose research and advisory firm works with clients across tech, retail and supply chains. The loss of the de minimis exemption had long been anticipated, with U.S. President Donald Trump temporarily closing it in February. In preparation, Temu and Shein had been accelerating localization strategies for the U.S. Scott Miller, CEO of e-commerce consulting firm pdPlus, told CNBC that Shein and Temu will continue to onboard goods from American sellers onto their apps to protect them from tariffs. "Many of the current sellers on Temu and Shein are located in China or countries nearby, but not all. Local U.S. companies have been joining these platforms at an accelerating pace ... several of our clients have onboarded or began the process of onboarding in just the past few months," he said. While margins for more localized brands and other sellers won't be as high as those for China-based sellers on the platforms, they can be competitive, he said. He added that in the case of Temu, vendors are attracted to lower fees, lighter competition and greater assistance with onboarding and setting up sales channels compared with what Amazon offers. In recent days, Temu, which is owned by Chinese e-commerce giant PDD Holdings, has begun exclusively offering goods shipped from local warehouses to U.S. shoppers. Many of those goods are still sourced from China but then shipped in bulk to U.S. warehouses, according to experts. While these bulk items are subject to tariffs, they also benefit from economies of scale. This development is likely to see the variety of products on Temu scaled back, said Henry Jin, an associate professor of supply chain management at Miami University. However, he added, Temu is likely to resume direct shipments from China, depending on the outcome of the trade war between the U.S. and China. Shein, meanwhile, has leaned into supply chain expansion, building manufacturing operations in countries such as Turkey, Mexico and Brazil, and reportedly plans to shift to Vietnam. The company appears to still be shipping directly from China and likely has more room to absorb tariffs because of its "sky-high" margins in its core fast-fashion business, Jin said. "If there's one thing that Chinese companies are good at, it's operating on a razor thin margin in an intensely competitive, if not adverse environment ... they find every scrap that they can to survive," he added. Contingency plans aside, experts agree that Trump's trade policy will continue to affect prices on Temu and Shein. The companies first announced they were raising prices in mid-April to counter tariffs. According to data from Coresight, prices across shopping categories on Shein rose between 5% and 50% in the latter half of April, with the sharpest rises seen in toys and games and beauty and health. However, many e-commerce experts remain confident that Temu and Shein will continue to prove price-competitive. Coresight's Weinswig said the two companies have previously been able to offer products at a third of the prices on Amazon for comparable goods. So, even if they more than double the prices to absorb the impacts of tariffs, many goods could remain cheaper than those on American e-commerce sites and retailers. Jason Wong, who works in product logistics for Temu in Hong Kong, noted this dynamic when speaking to CNBC last month, likening Temu to a dollar store. If prices at the dollar store go from $1 to $2, it's still a dollar store, he said. Furthermore, Trump's trade tariffs on China and other trade partners have also affected American retailers and e-commerce sites like Amazon. When Forever 21 filed for bankruptcy protection earlier this year, it blamed Shein and Temu's use of the de minimis exemption, which it said "undercut" its business. But experts say that exclusively attributing the success of Shein and Temu to that trade loophole misses many of the other factors that have made them smash hits in the U.S. According to Anand Kumar, associate director of research at Coresight Research, Temu and Shein owe a lot of their success to their very agile supply chains that adapt fast to consumer trends. For example, Shein's small-batch production — in which product styles are initially launched in limited quantities, typically around 100-200 items — allows it to test and scale products efficiently. Another key is the companies' applications, which use various strategies to maintain user interest, including frequent phone notifications, product recommendation algorithms and perhaps most notably, constantly displaying discounted prices from promotions and flash sales. Temu was offering a "mega savings extravaganza" for American consumers on Monday. Some of the bestselling items on sale included stainless steel hook earnings for $1.45 and a fitted mattress pad for $11.54. It's unclear if the discounted local goods were stockpiled before tariffs came into effect. In addition, app users will often be met with mini-games that grant different coupons or ways to earn rewards, as well as opportunities to buy "mystery boxes" with assorted products. That "gamification strategy" definitely plays into the consumer psychology of many U.S. shoppers who often buy items out of the excitement of being able to get a great deal, said Miami University's Jin. Experts also flagged that Temu and Shein have been very effective at marketing, including through the harnessing of livestreaming and social media. On the other hand, according to Coresights' Weinswig, American retailers have failed to adequately recognize threats from Temu and Shein and adjust their supply chains and pricing models.
CNBC
28-04-2025
- Business
- CNBC
European companies seem to be 'shifting to China': Analyst
Deborah Weinswig, CEO and founder of Coresight Research, talks about how Chinese e-commerce giants Shein & Temu may have 'leg up' in mitigating the end of de minimis exemptions, especially due to their more localized inventory. She expects China may fare better longer term than she initially believed.
USA Today
18-04-2025
- Business
- USA Today
Home Depot opening 11 new stores across US in 2025: See list of locations
Home Depot opening 11 new stores across US in 2025: See list of locations Show Caption Hide Caption 2025 store closures: Joann and JCPenney join Macy's, Kohl's JCPenney and Joann will shutter stores this year. They are joining Macy's and Kohl's which have announced plans to close stores in recent months. As some retailers are closing down, Home Depot is opening up, even amid an uncertain U.S. economy. A spokesperson for the home improvement company told USA TODAY on April 17 it is implementing a "bold growth strategy" consisting of opening 13 new stores in 2025, with 11 of them being in the U.S. One of the new locations, a 135,000-square-foot location in Florida, opened its doors April 17. "The retailer is supporting local growth and doubling down on the communities that need it most instead of scaling back," a spokesperson for the Atlanta-headquartered company said. "These new store openings are more than just ribbon-cuttings – they're investments in local economies and a commitment to meeting customer demand for brick-and-mortar shopping experiences." Home Depot said each new store is bound to create hundreds of jobs. Where is Home Depot opening new stores? Here's where new U.S. locations are opening in 2025, according to Home Depot: Spring 2025: World Commerce Center, St. Augustine, Florida - 2905 International Gold Parkway, St. Augustine, Florida, 32092 (opened April 17) Prasada South, Arizona - Cactus Drive, Surprise, Arizona, 85388 Anna, Texas Moscow, Idaho Manor, Texas Bulova, New York (expansion) Summer 2025: Spokane South, Washington state Charlottesville, Virginia Fall 2025: Caldwell, Idaho Mandarin, Florida Forney, Texas Home Depot currently has more than 2,300 stores across North America, according to the company's website. Since 2023, the company has opened more than 20 locations nationwide. Home Depot opening stores as retail closure expected to jump again Home Depot's decision to open new locations comes as other recognizable retail names have downsized operations or called it quits completely. Over 7,300 U.S. stores closed in 2024, according to Coresight Research, the highest mark since 2020 when the COVID-19 pandemic brought in-person shopping to the brink. "Overall, the surge in brick-and-mortar store closures this year can be attributed to a rise in online shopping and consumers' growing dissatisfaction with retailers that fail to meet expectations in customer service and pricing," Deborah Weinswig, Coresight's CEO, said, per AARP. 'Last year we saw the highest number of closures since the pandemic … and we continue to see a trend of consumers opting for the path of least resistance," Coresight Research CEO Deborah Weinswig previously said in a statement. Several once-prominent retailers, including JCPenney, Big Lots, Macy's Kohl's and Joann, have either announced store closures or complete dissolution of remaining assets. That trend of retail store closures is expected to continue into 2025, the firm said. Coresight previously projected the shuttering of about 15,000 stores throughout the year, offset by only 5,800 stores set to open. Meanwhile, stores like Barnes & Noble, Costco, Ross Dress for Less, DD's Discounts, Target, and Aldi have announced expansions for 2025. "With economic uncertainty at a high, many retailers are feeling the squeeze and shuttering their storefronts across the U.S., but The Home Depot is doing the opposite," the company told USA TODAY. Contributing: Mary Walrath-Holdridge, USA TODAY; Lucia Viti, St. Augustine Record
Bloomberg
09-04-2025
- Business
- Bloomberg
Tariff Uncertainty Grips Markets
"Bloomberg Markets" follows the market moves across every global asset class and discusses the biggest issues for Wall Street. Today's guests: BCA Research Chief Global Investment Strategist Peter Berezin, Coresight Research CEO Deborah Weinswig, JPMorgan Asset Management Fixed Income Portfolio Manager Kelsey Berro, BMO Capital Markets Biotech and Pharma Analyst Evan Seigerman, and Bloomberg's David Lee. (Source: Bloomberg)
