Latest news with #FederalAppealsCourt
Yahoo
7 hours ago
- Business
- Yahoo
How Should Brands Think About Cross-Border E-Commerce Amidst Uncertainty?
Cross-border e-commerce is likely to face heavy impacts from the changing global trade landscape, particularly as U.S. President Donald Trump's tariff strategy remains in flux. Data from FlavorCloud, which helps optimize cross-border shipping and returns, shows that apparel's cross-border conversion rates dropped by 5 percentage points—from 13 percent in February to 8 percent in March, when Trump started introducing, and in some cases soft-launching, what would end up being, in some cases, double or triple-digit duty rates. More from Sourcing Journal Can Tech Plug the Gaps Between Immigration Policies and Reshoring Aspirations? Federal Appeals Court Grants Trump Temporary Relief on Tariff Ruling April Air Cargo Demand Climbs 5.8% as De Minimis Reform Drives Pre-Deadline Surge Right now, the tariffs Trump set forth on 'Liberation Day' are on pause for most countries. Rathna Sharad, CEO and founder of FlavorCloud, said she anticipates that, once that pause is up—barring any further court intervention for overreaching, that is—Trump will introduce lower tariff rates on most countries. 'At the end of 90 days, I expect [rates] to be something more reasonable. We may have seen the worst of [it]. The 145 [percent tariff on China] was enormous, and it has impacted pretty much every single brand in a lot of ways,' Sharad said. Nonetheless, she advised that companies hoping to continue building out their cross-border business stop to consider their sourcing patterns, as so many companies have been since Trump began his second term. If prices on goods increase because of country of origin, and sending goods internationally is already more expensive, that could see companies passing a higher portion of the cost on to their international customers. Sharad said the smartest companies had already started building out a multi-sourcing strategy. 'It's not easy to implement alternative sourcing within a month or two. It takes a while to do that, but what is really important is that those that have made inroads [by] already thinking about multiple suppliers—or that were considering alternative sourcing options before—were able to make that switch relatively easily,' Sharad said. Fashion and apparel, as a category, has already been struggling when it comes to growth for cross-border e-commerce; FlavorCloud's data shows that, while other categories—like beauty, health and wellness, have seen rapid growth between 2024 and 2025, apparel and fashion has seen a 3.3 percent decrease. That pales in comparison to health and wellness' 201.2 percent increase and beauty's 46.6 percent uptick. Sharad said that slump could be attributable to two main factors: longevity in the cross-border market and price fluctuation. '[Apparel] has grown over the years pretty significantly, whereas these other categories are still brand new for cross border, so they're emerging,' she said, noting that apparel has also seen 'more significant price point and margin issues' than other sectors growing rapidly. For apparel companies, Asia, Africa and Latin America could be opportunity zones for further sales; in each region, apparel ranked the number one cross-border category in 2024. The report suggests that, while apparel is a top category in many markets, its stronghold varies by location based on pricing and delivery, which FlavorCloud contends should vary by region. Sharad said the company helps its clients determine those exact considerations, which she expects will only become more important as final—or semi-final—tariff rates come from world leaders. For apparel in particular, getting the mix right on products could help foster loyalty, which seems to be top of mind for many brands and retailers amidst uncertain economic times. Sharad said that, like domestic customers, international customers expect fast delivery, free or low-cost shipping and easy returns to stay truly connected to a specific brand. To be able to deliver on those considerations is likely to help retention rates, she said. 'They're coming back because they love the products, because they're not getting those products locally,' Sharad said. As she thinks about what's coming down the pike, she said unreliability continues to loom—so diversifying sourcing strategies would be a wise move to help make pricing most palatable for customers, and for brands themselves. 'Moving to multiple sourcing partners is an important thing for brands to invest in in the long term, because you don't know when the tariff implication is going to hit you. The one thing we know for sure is that the U.S. is front and center, and tariffs are the household name right now, simply because of the pace with which the changes came and…the magnitude of it,' Sharad said.
Yahoo
11 hours ago
- Business
- Yahoo
Retailers shift supply chains to reduce risks from Trump's tariffs on China
A number of retailers are working to reduce their exposure to China as President Donald Trump's trade war with the second-largest economy rages on. In recent earnings reports, executives have indicated that they are restructuring their supply chains to reduce reliance on China and mitigate the impact of tariffs. Trump sees tariffs as a way to boost domestic manufacturing, but avoiding China is challenging, and many retailers have already warned of potential price increases. China has been a significant target of Trump's levies, with the U.S. slapping tariffs of 145% in April before temporarily reducing them to 30% for about 90 days as part of a temporary agreement with China. However, Trump accused China of violating its temporary agreement, according to a Friday post on Truth Social. Trump Tariffs Face Legal Battle As Federal Appeals Court Temporarily Blocks Trade Ruling "The bad news is that China, perhaps not surprisingly to some, HAS TOTALLY VIOLATED ITS AGREEMENT WITH US. So much for being Mr. NICE GUY!" Trump wrote, without explaining how China violated the agreement. Read On The Fox Business App As tensions escalate, Macy's CEO Tony Spring told analysts on its earnings call Wednesday, the company is continuing to diversify the countries of origin for its private and national brands. At the end of last fiscal year, Spring said about 20% of total Macy's, Inc. products originated in China. National brands, which represent the majority of its sales, sourced approximately 18% from China and its private brands, where it has more direct control of the supply chain, sourced roughly 27% from China. That's down from 32% last year and a rate of more than 50% pre-pandemic, according to Spring. Best Buy Lowers Revenue Outlook For Fiscal Year 2026 Due To Tariffs Gap CEO Richard Dickson also told analysts on its earnings call last week that while China used to be one of the top sourcing countries for its products, it represented less than 10% of its sourcing last year. He expects that number to drop to less than 3% following the close of fiscal year 2025. "Most other countries represent less than 10%. Vietnam and Indonesia represented 27% and 19% of our sourcing last year, respectively, and our goal is for no country to account for more than 25% by the end of 2026," Dickson said. Dickson said the retailer is also planning to double its vendor sourcing of American-grown cotton in 2026. "Today, we are much better equipped to handle complex headwinds because we have a stronger financial foundation, and we are operating with greater discipline, growing brand momentum, and improved platform capabilities," he added. Target Chief Commercial Officer Rick Gomez told analysts on a recent earnings call that about 60% of its products were coming out of China in 2017. Today, it's around 30%, though Gomez said "we are well on our way to be less than 25% by the end of next year." "Our teams have been working very hard to offset the vast majority of the tariffs. And we're doing that because – or are able to do that because – of Target's size and scale, our [mixed] category business, which gives us flexibility, the productive partnerships that we have built with our vendors and suppliers and then our best-in-class global sourcing team has put us in a good position to be able to navigate these tariffs." Gomez said. He added that the company is "expanding into new countries, Asia as well as the Western Hemisphere, but I think it's important to note that we're also exploring opportunities here in the U.S." Apple's Tim Cook told analysts during its May earnings call that the majority of iPhones sold in the U.S. during the June quarter will have been produced in India. Vietnam will be the country of origin for almost all iPad, Mac, Apple Watch and AirPods products sold in the U.S. for the quarter, he said. Still, Cook said China would continue to be the country of origin for the vast majority of total product sales outside the U.S. Walmart CEO Doug McMillion told analysts during its May earnings call that he believes the company is positioned well relative to competitors, given that it has been working for years "to try and make sure that we've got surety of supply, we're sourcing from the right places, create a more flexible supply chain, and we've made progress on that." Nearly two-thirds of Walmart's U.S. spending goes toward products made, assembled or grown in the U.S., but the remaining third comes from around the world, with China and Mexico being the largest contributors. The nation's largest private employer has repeatedly warned that price increases are likely, especially given the magnitude of the tariffs. Earlier this year, the chief executives of Target and Best Buy also warned that tariffs against key trading partners will put pressure on profits and could drive up prices for consumers. Meanwhile, Trump faces legal challenges over implementing tariffs. One court ruled the president overstepped his authority by implementing sweeping tariffs. A federal appeals court on Thursday allowed Trump's tariffs to remain in effect temporarily after an appeal from the administration. In the Thursday decision, the U.S. Court of Appeals for the Federal Circuit granted an immediate administrative stay to the extent that permanent injunctions entered by the Court of International Trade on Wednesday are temporarily stayed until at least June 9, when the court will hear arguments. After June 9, the court can issue an order of enforcement. If it does, the administration will likely seek relief from the Supreme Court. FOX Business' Greg Wehner and Bill Mears contributed to this report. Original article source: Retailers shift supply chains to reduce risks from Trump's tariffs on China
Yahoo
2 days ago
- Business
- Yahoo
Gold Swings Below $3,300 as Court Ruling Roils Dollar and Trade Policy Uncertainty
Happy Friday, traders. Welcome to our weekly market wrap, where we take a look back at these last few trading days with a focus on the market news, economic data, and headlines that had the most impact on gold prices and other key correlated assets— and may continue to in the future. Gold fell to a weekly low of $3,260/oz after a court ruled against the Trump Administration's tariff authority. A Federal appeals court later paused that ruling, triggering a rebound in gold prices. The US Dollar's volatile response to legal and policy shifts played a key role in gold's movement. Gold ended the week near $3,300/oz ahead of key June economic data releases. Similar to last, this holiday-truncated week of gold trading has largely been dictated by investors' and traders' reactions to US fiscal policy headlines, with two notable differences: the market-moving headlines this week have almost all been tied to the latest tumult around the high-impact Trump Tariffs, and not so much relating to budget votes and negotiations in Washington; and the reaction in gold prices to tariff news has flowed through the US Dollar's pricing. Coming out of Monday's Memorial Day market holiday, Tuesday's overnight opens cut a deep sell-off into gold spot markets from $3340/oz to roughly $3310. Through Tuesday's trading and the first half of Wednesday in New York, gold maintained a steady enough level of interest from traders to hold at or just below the $3300 level, but precious few higher bids. With a mostly quiet macroeconomic data calendar on offer this week, it looked possible that (having moved past an unremarkable release of FOMC meeting minutes) the yellow metal might just linger at that level all week. Trading and price volatility in multiple asset classes, including gold, surged on Wednesday afternoon, however, as news broke of the US Court of International Trade announcing a decision that the Trump Administration does not have authority within the US Constitution to enact the majority of tariffs it has announced and/or threatened against trading partners large and small. One marked impact of this announcement was a climb in the US dollar, slow at first and then sharp, which sent gold spot prices sliding in the other direction. By the US market close on Wednesday evening (also just before the first opening bells for Asia's Thursday sessions,) the precious metal had fallen to the weekly low at $3260/oz in spot markets, from which it began to rebound with support. It's tough to tell just how much of gold's reclamation of $3300 (just south of it) was due to investors stepping in having felt gold suddenly became 'cheap,' because less than 24 hours after the announcement of the trade court's ruling against the Trump administration, a Federal appeals court 'temporarily paused' the ruling and its injunction, presumably pending an elevation of the argument to the US Supreme Court. Although this didn't change anything in the immediate sense, the news pushed a dramatic (but proportional) unwind of Wednesday's trade. The US Dollar stormed the headlines again, and the Greenback's trade value vs. partners fell, and gold spot prices rebounded as high as $3325/oz midday before moderating and settling back around what's looking like interchangeable support and resistance at $3300 where it has largely held the line through Friday's session. The flow of headlines around the US President's desired trade policy and its potential damages might actually slow in the first trading week of June and the early phase of the summer market doldrums, given the decision now likely moves to the Supreme Court at a date to be determined. We will have macro data again, finally, to contend with, though, as next week brings some key ISM survey reads and closes with the May jobs report. In the meantime, traders, I hope you can get out and safely enjoy your weekend for the next couple of days. After that, I'll see you back here next week for another market recap. 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
Wall Street Journal
3 days ago
- Business
- Wall Street Journal
Heard on the Street Recap: On Hold
A federal appeals court temporarily put on hold a ruling that voided President Trump's tariffs. The appeals court said it was pausing the Wednesday decision by the U.S. Court of International Trade until it can hear further arguments. Market reactions were muted, amid signs the global trade war is far from over however the court rulings turn out.
Yahoo
4 days ago
- Business
- Yahoo
Can Tech Plug the Gaps Between Immigration Policies and Reshoring Aspirations?
President Donald Trump has created an aggressive, America-first agenda for his second presidency. Part of his focus has been bringing manufacturing back into the United States, as evidenced by his continued comments about reshoring amidst the topsy-turvy of his tariff strategy. In some industries, that's a feasible proposal—but in fashion and apparel, it may prove a bit more difficult. More from Sourcing Journal Federal Appeals Court Grants Trump Temporary Relief on Tariff Ruling April Air Cargo Demand Climbs 5.8% as De Minimis Reform Drives Pre-Deadline Surge Podcast: Inside SJ's Tech Report: The Human Issue Sourcing strongholds like China, Vietnam and Bangladesh offer brands and retailers the ability to purchase mass quantities of goods—often made cheaper than they could be in the United States. But with their supply chains in jeopardy due to tariffs and general economic uncertainty, some companies have taken a harder look at what reshoring would actually require. Niki English, senior director of brand development at AJG Fashion Consulting, said that brands have long shown interest in nearshoring or onshoring, but most ultimately balk at the prices associated. 'It has always been a discussion: 'Hey, can we manufacture closer? Can we manufacture in the U.S.?' When we run cost scenarios, it just doesn't play out because of the cost of production in the U.S.,' she said. 'For some brands, it can definitely be workable, but for people looking to compete in the mass market or lower-price retail space, it's often just not workable.' Kristen Anderson, design director at women's intimates brand Iteration, said the company is among the many that have investigated—but ultimately shied away from—manufacturing in the U.S. She said that products that have technical components to them, like bras, are even harder to find qualified manufacturers for in the U.S. 'Even if it was possible, it would be so costly that nobody would want to buy it because we wouldn't be able to afford it,' Anderson said. While Anderson said her team would love to produce products in the U.S., Iteration couldn't find a manufacturer that could feasibly make its products in a cost-effective way. Instead, the brand turned to Sri Lanka, which faced a prohibitive tariff of 44 percent on Trump's 'Liberation Day.' Tariffs on most countries remain on hold because of 90-day pauses instated by Trump, meant to usher in trade deals, and uncertainty over Trump's authority to instate double-digit tariffs remains. But part of the equation for domestic manufacturing is often importing the textiles or components that need to be included in a finished product. Once final tariff rates have been settled, whether by Trump or by his Republican allies in Congress, added costs for materials could make onshoring aspirations difficult to turn into reality in a cost-effective way, said Mark Burstein, senior vice president, Americas at supply chain management company Inspectorio. 'Many brands and retailers have actively dispatched teams across the U.S. searching for domestic apparel producers. However, a significant challenge remains: limited fabric availability. Most domestic apparel factories haven't been able to scale operations effectively due to constraints like small order volumes that fail to achieve efficiency targets or price points so low that factories would operate at a loss,' Burstein told Sourcing Journal. 'While high tariffs imposed on major international apparel partners could potentially create opportunities for domestic growth, the persistent lack of fabric variety remains a substantial barrier.' While brands' onshoring aspirations have increased since Liberation Day, Trump's immigration policies may have a deeper-than-expected impact on fashion and apparel companies' ability to source products domestically. When Trump was elected in 2016, the then 70-year-old campaigned on a promise to bring manufacturing back to the U.S. Once he became president, he enacted a series of pro-business policies—including cutting the corporate tax rate, rolling back regulations and taking a hardline stance against trade partners like China—to support that goal, according to The Poynter Institute. Simultaneously, Trump made immigration a central issue of his presidency, frequently warning about the dangers of undocumented immigrants. But immigrants play a critical role in domestic manufacturing—particularly where the apparel industry is concerned. In 2016 alone, an estimated 23.1 percent of workers in the textile, apparel and furnishings sector in the U.S. were undocumented immigrants, according to New American Economy. That amounts to roughly 120,000 individuals powering a key segment of the industry. Almost 10 years later, Trump is still singing the same tune. Before his second term began, Trump stated 'On Day One…We will begin the largest deportation operation in the history of our country.' And he has kept true to his promise. Earlier this year, Trump sent planes full of Latin American migrants to Colombia, fulfilling his repeated campaign promise to deport undocumented immigrants en masse and using that as a bargaining chip for U.S. economic gain. According to Witness at the Border, a migrant advocacy group, Trump sent at least 350 deportation flights out of the U.S. between Jan. 20 and mid-March. Those flights went to countries like Guatemala, Honduras, Mexico and El Salvador, among others. He has also repeatedly promised to secure the Southern border of the U.S. to prevent the flow of illegal immigration. As part of his latest efforts to curb illegal immigration, former President Donald Trump signed a proclamation in May launching Project Homecoming, a program aimed at encouraging undocumented immigrants to voluntarily leave the U.S. According to the White House, the initiative offers two options: Depart voluntarily with federal support and financial assistance, or remain and face stricter enforcement and penalties. 'The continued presence of illegal aliens in our nation forces American taxpayers to bear a tremendous fiscal burden to support them,' Trump said. 'As president, it is my legal obligation to exercise all tools at my disposal to end this invasion, remove the illegal-alien invaders from the United States and protect the American people, [which is why I'm launching] Project Homecoming.' But that kind of policy could be a mismatch with Trump's apparent reshoring aspirations. Jamie E. Wright, founder and CEO of the Wright Law Firm, a labor and employment law firm, said domestic apparel manufacturers are likely to face significant headwinds as a result of Trump's policies. 'The labor shortage in U.S. manufacturing is already significant, and if immigration restrictions under a second Trump administration mirror or tighten past policies, we could see a real contraction in the available workforce,' Wright said. 'The apparel sector is particularly vulnerable because such a large percentage of the labor force has historically included undocumented or immigrant workers. If enforcement ramps up and pathways to work remain limited, the pool of eligible workers will shrink, fast.' There are several problems that come alongside Wright's assessment. Losing a large subset of workers also means that domestic factories will lose those workers' specialized skills—and according to those in the industry, that could be daunting to backfill. Prior to working with Iteration, Anderson worked for several brands, including one that sold swimwear. She said the company employed several sewists to help make samples, but noted that filling those positions—and retaining the workers—proved difficult because of high demand for their specific skill set. 'We never had a sewist in the sample room that was under the age of 50,' she said. 'Almost every single one of them was mature and speaking another language primarily. That population is going to get smaller and smaller with all of the [changes] happening right now, and they're going to be more and more afraid to work.' Anderson and other experts said they worry about the treatment of immigrant workers for that exact reason; Eric Kingsley, partner at Kingsley Szamet Employment Lawyers in California, said more restrictive immigration policy opens the door for poor treatment for, in particular, undocumented workers. 'The clothing sector's reliance on immigrant labor, and in particular those who are undocumented, creates a situation where workers are especially vulnerable to exploitation. More restrictive immigration policies serve to embolden the worst perpetrators in the sector to drive down wages, ignore safety standards and punish complaining workers, knowing that such workers fear deportation,' Kingsley told Sourcing Journal. 'As these policies continue to tighten, we can expect deteriorating working conditions and more widespread wage suppression, not only for undocumented workers but throughout the entire labor market, as fewer and fewer workers feel secure in demanding their rights.' Those issues compound an already stark reality: As of January 2024, more than 600,000 U.S. manufacturing jobs remained unfilled, according to the U.S. Chamber of Commerce; the problem is worse in nondurable goods than it is in durable goods manufacturing. For many Americans, working in a factory or manufacturing facility isn't an attractive proposition. With a president hyperfixated on onshoring, a labor shortage, a lack of large-scale facilities, steep offshore competition and tight immigration policies as the backdrop, it could be difficult to find a skilled labor force capable of handling apparel and fashion manufacturing in the immediate near term. But if onshoring becomes more of a reality, experts believe technology could help plug some—though not nearly all—of the gaps left behind. English said that while technology is suited to handle some tasks, it cannot fully replace the work of a sewist. 'I've seen fully automated sewing machines for things like towels or square [items], but as soon as you start to have 3D shapes…you need to have that human involved,' English said. 'The way I think automation could help the most would be efficiencies—laying out a pattern on the fabric most efficiently to reduce waste, or those types of planning [functions]. When it comes to the actual making, we're not anywhere near being able to replicate that.' Farzin Shadpour, partner at Silicon Foundry, said that while automation is likely to aid reshoring in the fashion and apparel industries, the technical infrastructure inside U.S. apparel manufacturing facilities today is sparse, and other industries have a leg up. With that in mind, he said the industry would need to digitize existing records and remove data silos, then automate the physical world. Bringing the fashion and apparel industries' manufacturing prowess up is also likely to require building new factories in hubs suited to handle the volume of incoming demand. 'It's possible to improve what we have, but if you're reshoring something and you want to compete with outside, then it should be built from the ground up with automation in mind,' Shadpour told Sourcing Journal, noting that any new-build factory would take at least two years to come to fruition. What's more, even if a company can expedite the construction of a new facility—or look to purchase robotics and automation tools that could make current factories more efficient—the inventory for such items may not exist, Shadpour said. 'A robot is not something that they have sitting around on the shelf,' Shadpour said. 'Most of [them are] made to order. Let's say you order 100 robots. They make it for you, and then they ship it to you in three months, so it's not something that can happen overnight.' Max Ma, CEO of merchandising software company 7thOnline, said that while he believes reshoring is potentially feasible in the longer term, the government would likely need to help subsidize the costs of building new factories, integrating emerging technologies and upskilling existing workers, something Trump seems unlikely to support give his 'tanks and technology' over T-shirts and sneakers comments. 'I don't see any reason for the government not to incentivize the business in the first place, if they believe this will generate jobs and generate tax income,' Ma even if technology is integrated in a meaningful way into existing or emerging manufacturing facilities, English said another major part of the equation will be reskilling employees who have previously worked in manufacturing facilities—or training a completely new sector of the workforce—on how to work side by side with emerging said immigrants employed by today's manufacturing facilities could be excluded from such training—particularly if they are undocumented. And with a president largely unsympathetic toward immigrants' success, that could lead to obsolescence for a large subsection of workers powering the apparel manufacturing operations in the U.S. today. 'Systematic discrimination in recruitment or training can exclude these workers from emerging opportunities even if they have transferable skills,' Kingsley said. 'Without targeted policies creating avenues for legal status, open retraining schemes and enforcement of anti-discrimination laws, these obstacles will remain.'
