In This Article:
While shoe retailer Foot Locker (FL) posted mixed fourth quarter earnings results, the footwear industry at large may need to lace up for a tighter 2025 after the Trump administration increased its tariff on Chinese imports to 25%.
Yahoo Finance host Madison Mills lays out how tariffs could impact footwear companies as shoes from China account for 42% of all footwear imports entering the US.
Also catch Yahoo Finance's coverage on how Trump tariffs are affecting US automakers, the pharmaceutical industry, and commodities markets.
To watch more expert insights and analysis on the latest market action, check out more Morning Brief here.
This post was written by Luke Carberry Mogan.
Foot Locker reporting mixed fourth quarter results and warning of promotional pressures this year. Meanwhile, the retailer is just one of several companies that could soon feel the effects of escalating global trade war. Madison Mills has a closer look at that impact, Maddie.
This week, the president, President Trump, doubling the tariff on all Chinese imports to 20% after enacting a 10% tariff earlier this year. Those duties are on top of existing tariffs on hundreds of billions of dollars worth of Chinese goods. So the question, what does this mean for a company like Foot Locker? Well, nearly 35% of Foot Locker shipments are imported from China, according to data from market research firm Volza. Now, let's take a look at the industry more broadly. The US market for footwear is almost entirely supplied by imports, the largest percentage coming from China. In 2021, China accounted for more than 42% of all US footwear imports worth $11.5 billion. So what does all this mean for consumers? Well, tariffs are paid by the US company importing the goods from China. So companies have to decide, are they going to pass on costs to consumers or raise prices to absorb the costs themselves? According to data from Moody's, just a 10% tariff on shoes from China could increase the sticker price for those shoes by about 4%.
