“We had a good amount of this,” said Henn, referring to raw materials, “so he gave us more time to know that we can manufacture and sell a lot of things without the cost of the rate.”
Henn said it was not a tariff strategy, but a benefit of his company’s workflow.
However, they knew that Leeway was not going to last forever. Finally, it became time for heritage steel to order more materials. That first tariff bill was approximately $ 75,000, and Henn expects the next double to be double the double.
Who pays?
For Heritage Steel, there was never doubt that he would have to increase prices due to tariff expenses. The question was how high they would have to go?
“We are happy and proud to be a supplier of high quality kitchen utensils, but that has a more affordable price than some of the others in the market,” said Henn. “We want to continue offering the best price we can, given our limitations.”
Until Friday, the company had increased prices by approximately 15% in all its products. Heritage Steel explained the increase in an announcement on its website, calling the “quite modest” adjustment considering that the price of the company’s entry materials increased at least 50%.
“Obviously, we cannot bear the total impact of these costs of costs,” said Henn, “but we don’t want our customers to have the total cost.”
He expects these changes to negatively affect the company’s profit margins, but from now on the measure is not clear. Henn believes that the company has more flexibility than many of its competitors because Heritage Steel is only importing raw materials, not the complete product, and manufactures in the US. That is why he hopes that the general interruption of the market could be good for the company.
“They may have to do something closer to an increase in the price of 50%,” he said about their competitors, “because all its cost of goods increases by 50%.”
For Heritage Steel, on the other hand, only the price of the pieces increases by 50%, not the complete product. Henn said that it is about finding the optimal point: a fair amount to charge customers to compensate for new costs and at the same time be a price leader in the market.