Tariffs have re-emerged as a powerful tool in global trade policy, reshaping the cost structures of countless companies. As governments impose import taxes to protect domestic industries or retaliate in trade disputes, businesses are left grappling with higher costs many of which are inevitably passed on to consumers. From retail giants like Walmart and Target to tech titans like Sony and Microsoft, price hikes have become a common response to rising tariff burdens.
Companies Feeling the Pinch
Several major brands have publicly acknowledged that tariffs are forcing them to raise prices:
- Walmart reported a 3.6% increase in procurement costs due to tariffs, prompting surgical price adjustments to protect margins.
- Home Depot noted “modest price movements” in certain categories, attributing them to significantly higher tariffs on imported goods.
- Adidas projected a €200 million hit from tariffs and announced price increases in the U.S. market.
- Sony raised the price of its PlayStation 5 consoles by $50, citing a “challenging economic environment” a euphemism often used to reference tariff-related cost pressures.
- AutoZone, a major auto-parts retailer, stated that it would pass tariff costs directly to consumers, with anticipated increases ranging from $4,000 to $12,000 on imported vehicles.
These companies span industries from electronics and apparel to home improvement and automotive, underscoring the widespread impact of tariffs.
Detailed Case Studies: Companies Raising Prices Due to Tariffs
1. Williams-Sonoma
Williams-Sonoma, the parent company of Pottery Barn, West Elm, and Rejuvenation, has faced a steep increase in tariff exposure over the past year. In Q2 2025, the company reported that its blended tariff rate had jumped from 6% to 34%, driven by new duties on imports from China, India, Vietnam, and raw materials like steel and aluminum.
To manage this, Williams-Sonoma:
- Pulled forward inventory at lower tariff rates to delay the impact.
- Re-sourced production from China to other countries with lower duties.
- Negotiated vendor concessions to offset cost increases.
- Raised prices selectively on new and differentiated items, especially in furniture and home décor categories.
- Maintained profitability through tight SG&A controls and supply chain efficiencies.
Despite these efforts, analysts expect tariff expenses to rise sharply in the second half of 2025, potentially affecting up to 35% of their furniture assortment. CEO Laura Alber emphasized that the company’s vertically integrated model and domestic manufacturing capabilities (like Sutter Street Upholstery) give it a competitive edge in absorbing tariff shocks.
Hormel Foods
Hormel, maker of Spam, Jennie-O turkey, and Planters nuts, has been hit hard by rising commodity costs exacerbated by tariffs. In Q3 2025, pork belly prices surged 30%, wholesale pork rose 10%, and beef hit near-record highs. Tariffs on imported meat and nuts added further pressure.
Hormel’s response:
- Targeted price increases across pork, beef, and nut-based products.
- Adjusted earnings guidance, citing a 1–2 cent per share hit from tariffs.
- Reduced restaurant channel volumes, as foodservice traffic declined.
- Assessed additional pricing actions for Q4 and early 2026.
Interim CEO Jeff Ettinger described the commodity inflation as “sudden and major,” and CFO Jacinth Smiley noted that raw material inflation alone added 400 basis points to costs in Q3. Hormel expects further price hikes to carry into 2026, especially in retail meat and snack categories.
PVH Corp.
PVH, the parent company of Calvin Klein and Tommy Hilfiger, faces a projected $70 million EBIT hit from tariffs in 2025, up from $65 million previously. The company estimates a $1.15 per share impact on earnings, driven by duties on imports from India, Vietnam, and China.
Mitigation strategies include:
- Shifting global production to lower-tariff regions.
- Enhancing supplier contracts to lock in better terms.
- Reducing promotional activity to preserve margins.
- Implementing selective price increases across core categories like underwear and denim.
Despite the tariff headwinds, PVH raised its full-year revenue guidance and maintained its operating margin outlook at 8.5%, signaling confidence in its brand strength and cost discipline.
J.M. Smucker
Smucker, owner of Folgers, Dunkin’, and Café Bustelo, has been hit by a 50% tariff on green coffee imports from Brazil and Vietnam. Coffee is its largest import category, with over 500 million pounds sourced annually.
The company’s response:
- Raised coffee prices four times since mid-2024.
- Announced further hikes for winter 2025 to offset new tariffs.
- Missed earnings estimates, with coffee division profits down 22%.
- Adjusted EPS guidance, citing a 25-cent hit from tariffs and 80 cents from coffee inflation.
Smucker is also facing higher costs on capital goods and exports to Canada, where retaliatory tariffs apply. CFO Tucker Marshall said the company is exploring alternative sourcing and supply chain optimization to manage the impact.
Urban Outfitters
Urban Outfitters, which includes Anthropologie, Free People, and Nuuly, has been navigating rising tariffs on apparel imports from India, Vietnam, and China. COO Frank Conforti stated that tariffs could impact gross margins by 75 basis points in 2025.
Their strategy:
- Frontloaded inventory to avoid fall disruptions.
- Negotiated vendor terms and shifted sourcing away from high-tariff countries.
- Raised prices gently, focusing on premium categories like denim and outerwear.
- Expanded owned brands, which offer better margin control.
Despite strong Q2 results, including 53% growth in Nuuly and double-digit comps in Europe, Urban Outfitters warned that tariff mitigation will remain a priority through 2026.
Abercrombie & Fitch
Abercrombie & Fitch reported a $90 million tariff impact for 2025, up from $50 million earlier in the year. The company sources heavily from Southeast Asia, including India and Vietnam, which are now subject to steep duties.
To offset this:
- Adjusted operating margin guidance, citing a 170 basis point hit.
- Shifted production to lower-cost regions.
- Reduced promotional activity and clearance sales.
- Raised prices selectively, especially in Hollister’s youth-focused lines.
Despite strong Q2 sales and record revenue, the company warned that further price hikes may be needed if tariffs escalate. CEO Fran Horowitz emphasized the importance of maintaining value perception while navigating cost pressures.
Why Tariffs Lead to Price Increases
Tariffs are essentially taxes on imported goods. When a government imposes a tariff, it raises the cost of bringing foreign products into the country. Here’s why that leads to higher prices:
Increased Import Costs
Tariffs directly raise the cost of goods sourced from abroad. For example, a 25% tariff on electronics from China means a $100 item now costs $125 before it even hits the shelf. Companies must either absorb this cost or pass it on to consumers.
Thin Profit Margins
Retailers like Walmart operate on razor-thin margins. Absorbing tariff costs would erode profitability, so price hikes become a necessary defense mechanism.
Inventory Replenishment at Higher Costs
Even if companies stockpiled inventory before tariffs took effect, those supplies eventually run out. New inventory comes at post-tariff prices, forcing companies to adjust retail pricing accordingly.
Supply Chain Disruption
Tariffs often prompt companies to seek alternative suppliers in lower-tariff regions. This transition can be costly and time-consuming, leading to temporary price increases during the adjustment period.
Strategic Pricing Adjustments
Rather than blanket price hikes, companies are increasingly using targeted strategies like adding shipping fees, removing free returns, or introducing “tariff surcharges” at checkout to recoup costs without alienating customers.
Other changes we are seeing is companies becoming more direct on their “Net Terms” and using cash flow to their advantages
Kohl’s is navigating the financial strain of tariffs and broader retail challenges by asking some vendors for extended payment terms a strategic move to conserve cash and manage working capital more effectively.
Here’s how this approach fits into their broader strategy:
Why Kohl’s Is Delaying Vendor Payments
- Tariff Pressure: Tariffs have disrupted supply chains and increased costs, squeezing margins for retailers like Kohl’s.
- Cash Conservation: By stretching out payment timelines, Kohl’s can hold onto cash longer, which is crucial during periods of weak consumer spending and declining revenue.
- Turnaround Effort: This payment adjustment is part of a larger operational review aimed at stabilizing the business. Kohl’s has been struggling with falling quarterly revenue and is trying to revamp departments and boost traffic through partnerships like the one with Sephora.
Market Reaction & Financial Context
- Stock Impact: News of delayed payments triggered a sharp drop in Kohl’s stock down as much as 13% before recovering slightly.
- Debt Load: Kohl’s is carrying over $2 billion in debt and recently issued junk bonds to meet upcoming obligations, indicating a tight financial position.
This tactic while not uncommon in retail signals Kohl’s is in a delicate balancing act: trying to stay afloat amid industry headwinds without alienating its vendor base. Want to dive deeper into how other retailers are handling similar pressures?
The Psychological Game of Pricing
Consumers are more price-sensitive than ever, especially after years of inflation. Companies know that overt price hikes can damage brand loyalty, so they often use subtler tactics:
- Dynamic pricing based on demand and inventory levels.
- Reduced product quality or quantity (a phenomenon known as “shrinkflation”).
- Bundling or upselling to mask individual price increases.
These strategies allow businesses to maintain profitability while minimizing consumer backlash.
The Bigger Picture
Tariffs are not just an economic lever they’re a geopolitical tool. While they can protect domestic industries in the short term, they often lead to retaliatory measures, supply chain disruptions, and inflationary pressures. For consumers, the result is simple: higher prices on everything from sneakers to smartphones.
As trade tensions continue to evolve, companies will remain in a delicate balancing act managing costs, maintaining competitiveness, and keeping customers happy. But one thing is clear: when tariffs rise, so do prices.