NAW CEO Sounds Alarm on Tariffs Threatening U.S. Supply Chain Expansion

President Trump has a dynamic plan to boost the U.S. economy, focusing on enhancing global competitiveness and showcasing American strength. However, if we don’t expedite new trade agreements, this vision could be compromised by the increasing weight of ongoing tariffs.Wholesaler-distributors play a crucial role in the supply chain. When their costs rise, it creates a ripple effect that impacts various industries—from manufacturing to healthcare. A recent study by the national Association of wholesaler-Distributors (NAW) revealed that while some trade negotiations are progressing, tariffs—especially those on chinese imports—are inflating costs and disrupting operations across the board.

The consequences are already apparent.About one-third of distributors report price increases exceeding 25% due to these tariffs, with nearly two-thirds anticipating their cost of goods sold will rise by at least 10% in 2025. Although consumers may not feel these hikes just yet, they’re on the horizon and will ultimately affect everyone—particularly small businesses.Supply chains are intricate and often involve lengthy lead times. As we approach holiday shopping season,retailers must order products well in advance to ensure availability by November. As an example, consider something as classic as an artificial Christmas tree; distributors need to place orders months ahead of time. However, rising import costs from tariffs have led many retailers to reduce or even cancel these orders altogether. Even after a temporary truce was announced between the U.S.and China regarding tariffs, cargo traffic at major ports like Los Angeles has dropped significantly—by about 25%. This means fewer options and higher prices for families looking for holiday decorations this year—and it doesn’t stop ther; toys could see price increases up to 56%,according to estimates from the National Retail Federation.

These escalating costs threaten millions of jobs across America too; current tariff policies jeopardize around 3.4 million positions nationwide.

Moreover, businesses are adjusting their strategies in response: many distributors have cut back on capital investments (37%), slowed hiring (44%), and reduced discretionary spending (60%). These figures aren’t just numbers—they signal potential trouble ahead for our economy when companies halt growth initiatives or freeze hiring processes.

“distributors have shown resilience through challenges like pandemics and inflation,” says Eric Hoplin from NAW—but uncertainty makes overcoming obstacles tough when tomorrow’s landscape is unclear.

In light of recent events like COVID-19 disruptions, many distributors shifted sourcing away from China towards countries such as Vietnam for greater stability—but now those efforts face new tariff challenges too! If reducing reliance on China is truly desired policy direction then businesses need assurance that long-term investments will pay off without unexpected barriers cropping up along the way.

That’s why we’re calling on President Trump to swiftly finalize extensive trade agreements—the foundation for his economic agenda needs clarity regarding supply chain rules so extended tariffs don’t undermine hard-earned progress!

The vision exists—it’s time now for decisive action!

Eric Hoplin serves as CEO at NAW.