After President Donald Trump confirmed tariffs on products imported from Mexico, Canada, and China, several businesses in the United States have warned about an increase in their prices, including Target and Best Buy. But what will happen with supermarkets? Will Costco prices increase?
Amid the uncertainty among its customers, the company has already issued its stance on the matter. Here’s what they said so you know if you should start preparing your wallet for a possible economic impact.
Will Costco prices increase due to the tariffs?
According to the company executives, Costco is prepared to absorb the increased costs of imported goods due to tariffs or inflation, meaning that Costco prices will not rise and will not impact its customers.
“Our team remains agile, and our goal will be to minimize the impact of related cost increases on our members,” the company stated.
Costco increases its sales
In its most recent financial report, as of February 16, Costco reported net sales of $62.53 billion, representing a 9.1% increase compared to last year’s $57.33 billion in sales. Additionally, its net income increased by 2.6%, reaching $1.79 billion.
Costco also reported a 6.8% increase in paid memberships, with 78.4 million memberships issued, reflecting a 7.4% increase in membership revenue.
ALSO READ Costco will open new stores in March! When and where?
Target and Best Buy Announce Price Increases Following Tariffs
This week, Brian Cornell, CEO of Target, warned that, following the implementation of tariffs, customers will have to pay more for various products, especially fruits and vegetables imported from Mexico during the winter season, such as:
- Avocados
- Strawberries
- Bananas
On the other hand, Corie Barry, CEO of Best Buy, stated that vendors would transfer the costs of the tariffs to retailers, resulting in price increases for U.S. consumers. This is because approximately 60% of Best Buy’s products come from China, and 20% come from Mexico.
Unlike Target, Best Buy does not anticipate an immediate price increase but expects it to occur between the second and fourth quarters of the year, particularly in the appliance sector, as the company has inventory for about six weeks.
What products will increase in price in the United States?
The 25% tariff on products imported from Mexico and Canada, and the 20% tariff on Chinese goods, will inevitably impact the wallets of American families, as the tariffs will force companies to raise prices to cover the taxes. Here’s a list of products that will see price increases.
Products imported from Canada to the United States that will increase in price
- Wood
- Coal
- Aluminum
- Iron and steel appliances
- Cereals, flours, and starches
- Dairy products
- Rubber
- Alcoholic beverages
- Carpets and other textile floor coverings
- Wool, animal hair, yarn, and horsehair
- Umbrellas
- Canes, seat canes, whips
- Cotton
- Photographic or cinematographic products
- Cork products
- Printed books
Products imported from Mexico to the United States that will increase in price
- Cereals
- Paper products
- Processed fruits and nuts
- Tropical fruits
- Tomatoes, onions, lettuce, and cabbage
- Pickled foods
- Fruit juices
- Fertilizers
- Dairy products
- Eggs
- Honey
- Cotton
- Beer and spirits
- Coffee, tea, mate, and spices
- Meat, fish, and seafood
- Sauces and condiments
- Baked goods
- Avocados
- Raw sugar
Products imported from China to the United States that will increase in price
- Fish and seafood
- Vegetable oils and fats
- Vegetables, fruits, and nuts
- Corn
- Soaps, lubricants, waxes, candles, modeling pastes
- Cereals, flours, starches, and wheat
- Dairy products
- Coffee, tea, and spices
- Sugar
- Cocoa
- Eggs
- Honey
- Vinegar
- Apple juice
- Garlic
What are tariffs?
Tariffs are taxes imposed on the import of goods. These tariffs benefit locally manufactured products by giving them a competitive price advantage over similar imported products. They also represent a source of revenue for governments.
Why did Trump impose tariffs?
President Donald Trump has stated that tariffs are an effective tool to correct trade imbalances and protect the U.S. industry. According to the Republican, China, Mexico, and Canada have not taken enough action to stop the flow of drugs and migrants into the United States, and he sees these tariffs as a way to pressure these countries to act.
