How to Combat Possible Tariff Troubles for AVL Customers

The President also ordered the start of the process to raise tariffs on nearly all remaining imports from China, an additional $300 billion (see press release). This increase will impact pricing on many categories of audio, video, and lighting products. With a clear and level head, and a bit of communication, we can certainly get through this. Below are some things you should be aware of that may help you avoid frustration in the near future with the impending changes:

• Each manufacturer is handling the tariff differently. Be aware that large project quotes with multiple manufacturers may be affected multiple times as each rolls out its new pricing plan. Some brands may choose to spread the impact across their entire product line, while others are focusing specifically on products directly impacted and pricing items based on that amount.
• Expect the unexpected. As each brand considers the impact of the tariffs, other inconveniences may occur as a result. Plan for possible shortages of popular items and potential delays in incoming stock replenishment.
• Communicate with your customers on both current short-term and long-term projects in the pipeline. We hope that everyone is watching the news, but some may not be. Non-industry customers and end-users may focus more on how tariffs affect the cost of their new TV or tablet at home than on how they affect upcoming installs. Make sure they know there is an upcoming period of pricing flux and increases, so they won’t feel blindsided when they decide to move forward.
• Pricing protection? Many manufacturers that will be heavily impacted are not offering pricing protection. The tariffs have been a hot topic over the last six months, and they believe we have all had sufficient notice of what is to come.
• Consider warehouse stock. Do you have something (or several things) you can’t live without—items repeatedly specified for multiple jobs, or a customer trying to standardize and only partway through the process in your contract? You may want to consider increasing your current stock of those items or possibly adding them to warehouse stock. Your company will need to ensure the benefits outweigh the costs, but knowing you can deliver certain items on time and at a stable cost may be worth the investment.
• BAA. We have to mention the Buy American Act. Consider shifting to options made in America or assembled in America using only small portions of other goods, if possible. These goods should see little to no price increase due to the tariffs. In some cases, they are easy to identify and source, but other product categories will definitely be more challenging.
• Communicate with your BAI Sales Team or other supplier contacts. If you have a project coming in the near future, please let us know as soon as possible. We can recommend BAA products if available, help keep you informed on pricing updates, and alert you to other changes that may affect your quote and potentially your bottom line.
• Plan for change. It’s one of the constants in life, right? For official tariff information, please visit: https://ustr.gov/