Peak season is already a difficult time to make changes to pricing, fulfillment and demand plans.
And this year, U.S. retailers selling into Canada have another variable: on Sept. 8, Canada imposed new counter-tariffs of 15%, 25% and 50% on $27.6 billion worth of U.S. imports, adding another layer of complexity to holiday pricing and demand planning.
But before retailers adjust their plans, they need to determine whether, and where, they are affected.
Tariff exposure starts with country of origin
A retailer may assume its entire Canadian business is impacted because it is headquartered in the United States, or because some of its products' HS codes appear on the tariff list. However, exposure depends on where it was manufactured, rather than where the seller is headquartered or where the shipment begins.
For example, a U.S. seller may see its products' HS codes on the tariff list and assume it will face the added cost. But if those products were manufactured in China, the new tariffs on U.S.-origin goods would not apply. Retailers that conflate a company's location with a product's country of origin could unnecessarily raise prices or pull back from the Canadian market just as ...