These days, tariffs are dominating the news cycle and the daily communication I have with owners, asset managers and project teams. While I cannot cover all the relevant points in the brief space of this newsletter, some key points to remember are as follows:               

• There have been tariffs on wood bedroom furniture made in China for almost every factory since June 24, 2004. Tariffs for our industry started over 15 years ago.
• The tariffs, regardless of percentage, are charged on the first cost FOB China, not the price of the product shown on the purchase order to the vendor. The spread between first cost and price on the purchase order varies per vendor and per item.
• Almost all the tariffs making the headlines today are for products from one country, China, not the rest of Asia.
• The law of supply and demand is in effect in every market and every country in the world. When demand goes down and supply stays the same, prices decline. Is the price difference enough to make up for the current tariffs? In almost all cases no, but every percent helps.
• While there are many countries to source FF&E and OS&E items, now more than ever, the assistance of a global purchasing firm is mission critical for determining the best value for every dollar spent.

If you have any questions or concerns about your project with regard to tariffs, port strikes, currency changes or other macro and global events that affect the FF&E and OS&E supply chain, please contact us.