How Stanley Black & Decker Would Deal with New Trump Tariffs
As the presidential election campaign has evolved, the debate around tariffs has moved up in the pecking order of topics as former President Donald Trump has doubled down on various plans or rolled out new ideas he says will address global trade imbalances.
Regardless of their voting preferences or expectations that Trump’s policies will come into effect, business leaders have needed to plan for the possibility of such tariffs. Many executive teams have been understandably reluctant—for reasons competitive and/or political—to discuss their scenario planning. Which is why our ears perked up Oct. 29 when Stanley Black & Decker Inc. President and CEO Don Allan spoke at some length about the manufacturer’s plans in response to an analyst’s question after his team reported third-quarter results.
Allan started his response by noting the many unknowns that remain around possible Trump administration priorities. Here, in refreshingly frank and to-the-point language, is the rest of his answer:
We have been planning for this possibility since the spring and have gone through a variety of different scenarios to plan for. And obviously, coming out of the gate, there would be price increases associated with tariffs that we put into the market. And so we’ve worked through a lot of that.
We’ll continue to work through as if the scenario plays out and the tariffs become more concrete. We will work through getting those into the market in a reasonable time frame, knowing that there’s usually some type of delay given the processes that our customers have around implementing price.
The second thing is we’ve built a fairly robust plan of how we would mitigate, over the next two years, these tariffs by moving production and aspects of the supply chain to different parts of the world. And some of that would be potentially moving things from China to other parts of Asia, maybe to Mexico. We’ll see, but likely to other parts of Asia.
