Costco CFO Gary Millerchip became the latest retail executive to warn that President-elect Trump's proposed tariffs would raise costs for consumers.
In a recent earnings call, Millerchip told analysts that there is still "a lot of uncertainty around the timing and scope of changes," making it hard for anyone to confidently predict what the impact will be.
Still, he acknowledged that, in general,"tariffs raise costs so that's not something that we see as a positive."
"When it rains, it rains on everybody," he added.
WALMART WARNS OF HIGHER PRICES IF TRUMP IMPLEMENTS PROPOSED TARIFFS
Under Trump's proposals, a universal 10%-20% tariff would be imposed on imports from all foreign countries, and an additional 60%-100% tariff would be imposed on imports specifically from China. Trump also said he would issue an executive order upon taking office to charge Mexico and Canada a 25% tariff on all products coming into the U.S.
For Costco, Millerchip says its merchants and buyers are equipped to navigate that situation because they have faced tariffs in the past.
The company has also already purchased inventory earlier "because of some of the less predictability around shipping and how much time product spends on the water and also because of the risk of strikes that we've seen in the past as well," Millerchip said.
TRUMP'S TARIFFS WOULD DRIVE UP CONSUMER PRICES: NATIONAL RETAIL FEDERATION
"We'll, of course, try and work with our vendors to make sure we're looking for ways where we can to mitigate the cost," he said.
Earlier this month, Dollar Tree – which has high exposure to China – warned that if tariffs are implemented, then the company might have to change product details or sizes and even get rid of items altogether if they become too expensive.
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A spokesperson for Walmart previously told FOX Business that the company remains "concerned that significantly increased tariffs could lead to increased costs for our customers at a time when they are still feeling the remnants of inflation."
Walmart CFO John David Rainey said during an interview on FOX Business in November that "tariffs are going to be inflationary. There's no disputing that."
Karoline Leavitt, Trump's incoming White House press secretary, previously told FOX Business that, during Trump's first term the tariffs imposed on China "created jobs, spurred investment and resulted in no inflation."
She said Trump plans to restore the economy, in part, by "re-shoring American jobs, lowering inflation, raising real wages, lowering taxes, cutting regulations and unshackling American energy."
