United States | News & Politics

As a good faith answer to your question that I hope you read with an open mind -

Between the tariffs and what the tariffs have done to the market (reducing options for supply makes the market less competitive and increases demand in other ways), my industry's publicly available market costs went up a few tenths of a percentage point shy of 50% in the last two months alone.

In my industry, to pay your bills (your rent, your taxes, your employees, your lights, your freight, marketing, R&D, liabilities, funds to replace equipment when it breaks, etc) you are targeting 25-30% "direct" margin - minimum, if you're barely treading water - which is (sell price - material costs) / sell price. With that math, a company that was previously reporting a 40% margin (say ($100 - $60)/$100) that had a 50% increase in material costs is now making a 10% margin (($100 - $60x1.5)/$100 = (100-90)/100 = 10%). That's bankruptcy.

That's not considering that costs have been increasing for more than just the last 2 months - anyone with a wallet knows that already, our industry number is 80% YOY increase in basic costs (margin math: 40% ==> negative 8%) - or that the true costs of tariffs haven't even hit yet.

We also cannot pass an 80% increase in costs on to our customers without literally triggering industry recession if not collapse. We can barely pass on 40% and "tightening belts" to make absorbing the other 40% possible (margin math: 40% ==> 16%, half the general target) means good guys and gals with families lose honest, hard-working jobs. Even for a highly efficient business, being told the government is going to send you an extra 25-104% bill because fuck you, that's why is going to be a heart attack level shock.

This is local manufacturing - the exact businesses who tariffs are supposed to be encouraging to do business in the US. A LOT of manufacturing is like this - it turns out tariffing the ever living fuck out of literally everything includes raw materials that you can't get here that manufacturers need. This is literally just for our divisions' own internal numbers too - no CEO pay coming out of this. Administratively, we run a skeleton crew already to make sure our costs are competitive, and it costs us hard already in turnover due to burnout.

The number of meetings we've had trying to figure out how on earth we keep our doors open without crashing an industry and then closing our doors anyway has quite literally had people in tears in the board room.

Are there companies who will use this for profiteering? Absolutely, tons of them. The companies who have the luxury of doing so are either are "inflexible demands" (ie food and medical care) or extremely large monopolies. Smaller companies, "discretionary spending", and highly competitive markets like mine are just going to hold their breath and try not to drown, raise prices where they have to, inevitably go out of business in droves, THEN get bought up by a large monopoly who will make an 80% price increase look like child's play because fuck you, everyone else closed.

We don't need to fuck ourselves, Trump is doing that for us, thank you. And yes, people without jobs or who have nothing left after groceries don't buy a lot of luxury keyboards, especially after their costs go up significantly - something I'm sure they have considered once or twice or repeatedly at checks watch 2 in the morning when they wish they could sleep, if they're having the sort of time we're having here.