[6DM]

If the companies are interested in protecting their margins, I think we will see prices higher than the % increase in tariffs e.g. many grocery stores have a 1 - 4% profit margin, so a 25% increase would mean they have to increase more than 25% because the overall profit margin will decrease. $1 with a 4% profit margin means it make 4 cents, but $1.25 with a 4% profit margin is 5 cents. So that means they'd have to raise it like 27%.

[koolba]

The vast majority of products at grocery stores are not imported from overseas. And even when they are, the cost of the good is only a part of the total cost to the store. For example no tariff would change the price of intra-USA transport of imported goods (well besides oil…). Labor and real estate need to taken out as well.

Obviously if you increase a cost the price is going to go up, but it’s not anywhere near 27% for groceries specifically.

Now pure imports, like most of the crap on Amazon or Temu, is another story.

[cratermoon]

Have you looked at where your produce comes from?

[alephnerd]

> I think we will see prices higher than the % increase in tariffs

Pretty much. Most consumers (and even a lot of purchasers) don't know about the individual tariff rates per good, so it's safe to assume that you can optimize pricing to maximize your margin where possible.

[jayd16]

This was presumably true already, but it's certainly true that some price fixing can happen while the dust settles (if it ever will).

[jayd16]

Beyond that, there's economies of scale that won't scale as far, based on lowered demand.

[laweijfmvo]

Of course we will....

Inflation -> Sorry, gotta raise prices -> Profits increased

Interest Rates -> Sorry, gotta lay everyone off -> Profits increased

Tariffs -> Sorry, gotta raise prices again -> .....