Despite the looming threat of new tariffs on footwear imports to the U.S., the atmosphere was upbeat among retailers and brands during footwear market week in New York City.

At FFANY, the turnout was strong, with buyers from Rack Room Shoes, Nordstrom, Target, Walmart, Kohl’s, Zappos, Von Maur and more all attending the show to meet with brands.

“Retailers were coming in from all over the country, whether it was boutique retailers, specialty retailers, department stores or big chains from different categories,” said Sandi Mines, vice president of corporate engagement at Footwear Distributors and Retailers of America (FDRA) and FFANY. “It was really packed.”

Over at Footwear Show New York Expo (FSNYE) at the Park Lane New York, president Phyllis Rein was upbeat. “The show delivered 70 well-known brands and new inspiring designers, which was an increase of 20 percent this year,” she noted. “The takeaway from the show was ‘shoes aren’t just functional, they’re a powerful tool for self-expression and motivation.'”

Tariff Talk

Overall, Mines described the sentiment across the industry as “cautiously optimistic,” though many companies are mulling how potential new tariffs on foreign imports could impact the footwear industry. Ninety-nine percent of the shoes sold in the United States are imported from primarily China, Vietnam and Indonesia, regions that could be subject to potential tariff changes under President-elect Donald Trump.

The threat of new tariffs on foreign imports could have a major impact on Toms, which does 80 percent of its production in China and 20 percent in Vietnam.

“The tariff talk around China in particular and trading partners at large is top of mind,” said Jared Fix, who joined Toms as chief executive officer in July. “We have world class manufacturing partners who are committed to this brand. So if we need to have an ex-China manufacturing strategy, we can do that.”

Baby shoe brand Robeez, which returned to FFANY in June after several years, manufactures most of its shoes in China. Jennie Leone, the brand’s director of sales, said that tariff changes would likely prompt an increase in retail prices as margins become more slim.

“The buyers I’ve spoken to understand that it’s probably going to be across the board, but unfortunately, the consumer is probably going to end up paying for it at the end of the day,” Leone said about tariffs. “We’re going to do our best to keep our price points where we can. At the end of the day, if you have a good product, that’s what matters.”

Western Chief, the Washington Shoe Company owned outdoor brand, operates all of its manufacturing and production out of China, which makes it vulnerable to potential tariff restrictions in the region. According to creative director Sara Kimball, the brand is actively seeking out potential new partners in Vietnam, the Dominican Republic and Brazil.

“I think we’re really just waiting to see where the tariffs are gonna land before we commit on which country,” Kimball said.

Journee, which has recently expanded from boots and dress into some more casual styles, is also exploring back-up options with several of its factory partners. The brand mainly manufactures in China, but noted that many of its partners have sister factories in different locations.

“I always like sourcing and keeping all my eggs spread out anyway, so I feel like there’ll be some of that,” said Marisa Byrne, brand president of the KNS International-owned Journee. “And it’s a mixture of just being proactive about how we’re comping out.”

Tariffs aside, Byrne noted that Journee is seeing demand for more transitional styles that can be worn on more than one occasion. “Versatility seems to be one of the biggest comments that I’ve heard across all of accounts,” said Byrne. “Where can she get the most value, the most bang for her buck, but also have several instances that she can actually wear that item?”

For brands that manufacture in Europe, tariffs were less of a concern.

“We don’t have the issues that many other contemporary brands do — actually, the bulk of the market,” said Nancy Nicolas, head of sales for Free People Footwear. “Because we don’t produce in China. All of our production is done out of Italy, Spain, Portugal and India.”

Nicolas added that demand from buyers is definitely picking up. “I think in this moment, everybody’s feeling bullish about the future,” said Nicolas said. “I think we’re past that cycle of uncertainty with elections. That’s over and done with.”

Dick’s Sporting Goods is the latest retailer to publicly sound off about its strategy to deal with potential new tariffs.

In a Tuesday call with analysts discussing the company’s third quarter results, Dick’s chief financial officer Navdeep Gupta addressed how the company will approach the impact of potential new tariffs on imports to the U.S. Just this week, president-elect Donald Trump said he plans to impose a 25 percent tax on all products entering the U.S. from Canada and Mexico, plus an additional 10 percent tariff on imports from China.

Gupta said that while details like timing and impacted categories are still unknown, Dick’s has navigated several rounds of tariff changes during the prior Trump administration. For that reason, he remained optimistic about the company’s ability to manage through the changes once more.

“[From a] vertical brands perspective, we have a very small — actually very negligible — amount of exposure because we have diversified our supply chain, both from China and there’s not much of an exposure even if you look into Mexico or Canada,” Gupta said. “So we feel we are well positioned for that.”

When it comes to footwear, a key category for Dick’s, 99 percent of shoes sold in the United States are imported from primarily China, Vietnam and Indonesia. Trump’s proposed tariff plans on these regions, as well as on Mexico and Canada, could vastly increase the cost of footwear for consumers in the U.S.

Dick’s Sporting Goods partners with top shoe brands like Nike, Hoka and Adidas, all of which have some level of exposure to potential tariffs. However, Gupta said Dick’s will leverage its strong partnerships with its key vendors and navigate the changes together.

“As more is learned, we’ll continue to navigate that in close partnership with our national brand vendors,” Gupta said. “Overall, if you look back to how we navigated this in 2018 and 2019, that will be kind of the playbook that will follow here again as more is learned.”

Like Dick’s, other shoe brands and retailers have already diversified their sourcing away from vulnerable regions like China in the wake of the supply chain meltdown in 2021. As such, executives from Amer Sports, Shoe Carnival and Under Armour have recently touted their abilities to weather another era of tariff changes under a new Trump administration. Notably, Steve Madden recently called out its longstanding efforts to diversify its supply chain from China and developing production capabilities in Cambodia, Vietnam, Mexico and Brazil.

Dick’s on Tuesday raised its 2024 outlook after reporting that its Q3 revenues were $3.06 billion, up 0.5 percent from the same quarter last year and ahead of the $3.03 billion expected by analysts surveyed by Yahoo Finance. Earnings per diluted share were $2.75, up 15 percent from last year and ahead of the $2.69 analysts were looking for. Comparable store sales were up 4.2 percent.

Donald Trump has outlined more details about the tariffs he plans to enact when he enters office again in January for his second term — and they could have even more dire consequences for the footwear industry than initially expected.

The president-elect said he plans to impose a 25 percent tax on all products entering the U.S. from Canada and Mexico, plus an additional 10 percent tariff on imports from China. That’s after Trump vowed earlier this year to impose a 10 to 20 percent tariff on imports from all foreign countries and an additional 60 to 100 percent tariff on imports specifically from China.

With 99 percent of shoes sold in the United States imported from primarily China, Vietnam and Indonesia, Trump’s proposed tariff plans could vastly increase the cost of footwear for consumers in the U.S. The proposed tariffs on Mexico would also impact companies like Steve Madden that have attempted to nearshore production to the region that could now be subject to higher tariffs.

According to a recent survey from Bain & Company, 81 percent of CEOs and chief operating officers said that nearshoring and onshoring are integral to their future plans. Mexico had recently been a notable beneficiary of the movement, unseating China as the U.S.’ biggest trading partner for the first time in two decades last year.

Steve Lamar, president and chief executive officer of the American Apparel and Footwear Association (AAFA), warned of the inflationary impact that additional tariffs in Mexico could have on the footwear industry and consumers at large.

“Mexico is a significant trading partner in the footwear field, particularly for leather goods. While it may take a few months before these Trump Taxes show up as spiraling prices for consumers, the newly proposed tariffs on U.S. imports from Mexico, Canada, and China (affecting more than half of all trade) will undoubtedly be inflationary for all Americans on essential everyday goods,” Lamar said in a statement. “These threats tear down the one trade agreement Trump takes credit for in his previous term — United States-Mexico-Canada Agreement (USMCA).”

Matt Priest, president and chief executive officer of the Footwear Distributors and Retailers of America, also noted how the new tariff proposals could impact shoe prices for American consumers.

“We hope President-elect Trump rethinks these tariffs as they relate to footwear, as such measures would place an unnecessary burden on American families when budgets are already stretched thin,” Priest said in a statement. “A 25 percent tariff on products from Mexico and Canada and a 10 percent tariff on goods from China would directly increase costs for retailers and consumers, leading to higher prices on everyday essentials like shoes.”

A study from the National Retail Federation (NRF) earlier this month found that if implemented, Trump’s tariffs could cost US consumers between $46 billion and $78 billion each year. Within footwear in particular, the study found that U.S. consumers could pay between $6.4 billion to $10.7 billion more for footwear a year.

More footwear companies are coming to terms with how new tariffs might impact an industry that is heavily reliant on imports from foreign countries.

Ninety-nine percent of the shoes sold in the United States are imported — primarily from China, Vietnam and Indonesia. Donald Trump, who recently won his presidential bid, has proposed a tariff plan that includes a 10 to 20 percent tariff on imports from all foreign countries and an additional 60 to 100 percent tariff on imports specifically from China.

Luckily for the shoe industry, many companies have already diversified their sourcing away from vulnerable regions like China in the wake of the supply chain meltdown in 2021. So executives appeared overall confident in their ability to weather another era of tariff changes.

Amer Sports, parent company to Salomon, Arc’Teryx, Wilson and other brands, addressed the potential impact tariffs could have on business in an earnings call this week. Chief financial officer Andrew Page told investors that company already operates a diversified sourcing model.

“Greater China represents less than 30 percent of Amer Sports’ global sourcing,” Page said. “And looking at Amer Sports Group in totality, sourcing from China to the U.S. market represents only 10 to 12 percent of total group revenues.”

The executive added that higher tariffs would mainly impact the company’s smaller ball and racquet category.

“We have some degree of flexibility to adjust our supply chain, but price increases will be the primary tool we utilize should tariffs occur,” Page said.

TJX Companies, the parent company to TJ Maxx, Marshalls, HomeGoods, Sierra, and Homesense, also addressed tariffs in an earnings call with analysts this week. According to CEO Ernie Herrman, the off-price retailer’s model is “a benefit” because it allows it to maintain a consistent value proposition over direct retailers. TJX, which diversified out of China several years ago, also buys much of its inventory directly from brands.

“If a brand were to get hit with increased tariffs on a category, and that brand had to raise their price and then that price gets carried on to another retailer, could that price on that one SKU for us be up a little? It might, but it will never be any issue with the value gap that we have relative to the competition,” Herrman said.

At Shoe Carnival, chief merchandising officer Carl Scibetta said that tariffs “seem to be the topic of conversation with every vendor appointment” that the retailer has had.”

Scibetta noted that while Shoe Carnival directly imports a very small percent of its own inventory, close to half of its inventory from partner brands have exposure to China, especially athletic brands.

“We’ll have to be very careful about pricing to our consumer and certainly look at where products are being made and how we can best provide the value that our consumers are used to,” Scibetta told analysts. “But at this point, we’re like everybody else, we’re watching it very carefully and we will adjust where we need to. But most importantly, we will continue to deliver value to our customers.”

The U.S. presidential election made its way into several remarks in footwear earnings calls this week.

Overall, executives discussed how Donald Trump‘s win over Kamala Harris might impact tariff policy, which in turn, would impact an industry that is heavily reliant on imports from foreign countries. (99 percent of the shoes sold in the United States are imported from primarily China, Vietnam and Indonesia.) Donald Trump’s proposed tariff plans include a 10 to 20 percent tariff on imports from all foreign countries and an additional 60 to 100 percent tariff on imports specifically from China.

Luckily for the shoe industry, many companies have already diversified their sourcing away from vulnerable regions like China in the wake of the supply chain meltdown in 2021. So executives were overall confident in their ability to manage another era of change, if necessary.

In a call with analysts on Thursday, Under Armour chief financial officer David Bergman said that the athletic company is on alert for potential tariff implications but does not expect any “sizable impacts.”

“There could be some U.S. duty implications that could impact our cost of goods sold and gross margin, and a little bit with income tax expense,” Bergman said. “But it’s something that we were prepared to manage pretty well before. We’ll continue to manage it as best we can going forward.”

At Wolverine Worldwide, which owns the Merrell, Saucony and Sweaty Betty brands, president and chief executive officer Chris Hufnagel said the company had worked hard to diversify its footwear sourcing outside of China. Exposure in the region went from about 40 percent in 2019 to the mid-teens in 2024, Hufnagel said, adding that within its sourcing ecosystem, Wolverine has the ability to “dual source” if needed.

“Other important regions are Vietnam, Bangladesh and Indonesia — important pieces as the new realities are there,” Hufnagel said. “And as we hear more, we’ll obviously contemplate things that we need to go do to make sure we can protect and seek to grow the business.”

Steve Madden also called out its longstanding efforts to diversify its supply chain from China. Ed Rosenfeld, chief executive officer of the New York-based company, told analysts on a conference call Thursday that Madden — which reported solid third-quarter earnings — had been preparing for a “potential scenario in which we would have to move goods out of China more quickly.”

Overall, about two-thirds of Madden’s business is derived from imports, with about 70 percent of those imports sourced from China. Rosenfeld said the company has been working hard to develop production capabilities in Cambodia, Vietnam, Mexico and Brazil with an overall goal to reduce the percentage of goods produced in China by 40 to 45 percent.

“If we’re able to achieve that, a year from today we would be looking at just over a quarter of the business subject to tariffs,” Rosenfeld said.

The New York-based Tapestry also addressed the tariff news in a call with analysts this week. Chief financial officer and chief operating officer Scott Roe said the company, which owns Kate Spade, Coach and Stuart Weitzman, has often been required to adapt its supply chain due to port strikes, freight issues and changing tariff rules in the past.

“We’re pretty well versed in managing through this,” Roe said. “We’ll see what comes in terms of specific tariffs and other legislation that may come and we’re monitoring that closely and certainly prepared to react.”

Roe also noted that Tapestry has less than 10 percent of its overall sourcing based in China.

“So from an exposure standpoint, at least as it relates to China, that’s really on a relative basis not a big concern,” he said.

Outside of tariffs, some experts believe that Trump’s win, which prompted a market rally, will have a positive impact on consumer confidence and holiday spending this year.

“Coming off the election, I think that we’re going to have a much better holiday season this year than we did last year. I think the economy is on the right foot, people are normalized to the pricing, wages are typically up and employment is pretty high,” Andy Polk, senior vice president of the Footwear Distributors and Retailers of America, told FN in an interview. “You’ve got all these [positive] economic indicators.”

Donald Trump has just won the election for the U.S. presidency. And a new study from the National Retail Federation (NRF) has found that if implemented, his tariffs could cost US consumers between $46 billion and $78 billion each year.

The recent study from the retail trade group examined how Trump’s tariffs proposals could impact the following categories: apparel, toys, furniture, household appliances, footwear and travel goods. Trump’s proposed tariff plans include a 10 to 20 percent tariff on imports from all foreign countries and an additional 60 to 100 percent tariff on imports specifically from China. Within footwear in particular, the study found that U.S. consumers could pay between $6.4 billion to $10.7 billion more for footwear a year.

For example, the study revealed that a $50 pair of sneakers could rise to between $59 and $64 dollars.

On the other hand, Kamala Harris’ tariff policies were expected to be a continuation of President Joe Biden’s policies, which included keeping the burdensome Section 301 rates in place, which have also contributed to higher shoe prices at retail.

“Retailers rely heavily on imported products and manufacturing components so that they can offer their customers a variety of products at affordable prices,” NRF’s vice president of supply chain and customs policy Jonathan Gold said in a statement. “A tariff is a tax paid by the U.S. importer, not a foreign country or the exporter. This tax ultimately comes out of consumers’ pockets through higher prices.”

99 percent of the shoes sold in the United States are currently imported from primarily China, Vietnam and Indonesia. With the U.S. footwear industry bringing in 2.5 billion shoes a year, it already pays $4 billion a year in tariffs.

Shoe prices were mostly flat in September from a year ago, but the category is expected to see an overall rise by the end of 2024 for the fourth straight year, according to the latest data from the Footwear Distributors and Retailers of America (FDRA).

Shoe industry trade groups have been vocal about the adverse effects that tariffs bring to consumers. In September, a survey from FDRA found that tariffs and trade policy were top of mind for U.S. shoe executives in the third quarter.

“Our Q3 Shoe Executive Survey reflects both the optimism and the challenges facing the footwear industry,” said FDRA president and chief executive officer Matt Priest in a statement in September. “With trade policy looming large in a presidential election year and consumer behavior constantly evolving, our members are prepared to navigate these uncertainties. FDRA will continue to provide the tools and insights they need to succeed.”

Shoe prices slowed moderately in April — in tandem with a general slowdown in overall consumer retail prices — according to the latest data from the Footwear Distributors and Retailers of America (FDRA).

Retail footwear prices rose 1.4 percent in April compared to the prior year, short of March’s fastest growth rate in sixteen months. Men’s footwear prices, which grew 4 percent, were responsible for most of the uptick. Women’s footwear prices rose 1.1 percent and children’s footwear prices dropped 1.9 percent.

The higher prices on men’s footwear, which is up 2.5 percent year to date compared to the same period in 2023, confirms the FDRA’s prediction that men’s shoe prices will continue to rise in 2024, chief economist at FDRA Gary Raines told FN. Meanwhile, the cost of imports for men’s footwear is down 8.6 percent year-to-date and is on track to hit its steepest annual drop in over 35 years.

“Over the long term, men’s retail footwear prices tend to trend in step with — even in response to —average import costs for men’s footwear,” Raines told FN in a statement. “But so far this year an unusually wide divergence between the two has erupted, with the average import cost sharply lower but the average retail price higher. For this divergence to narrow, either men’s footwear prices would need to ease over the balance of the year or import costs would need to climb.”

This latest rise in footwear prices comes as the Bureau of Labor Statistics reports that overall retail prices increased slightly in April from the previous month. Prices rose 0.3 percent in April from March, and 3.4 percent from the prior April, which was slightly less than the 3.5 percent increase in March. Excluding volatile food and energy costs, the core CPI rose 0.3 percent in April and 3.6 percent from the same month in 2023.

President Joe Biden said on Tuesday that he is maintaining tariffs imposed by his predecessor, President Donald Trump, on more than $300 billion worth of Chinese goods such as footwear and apparel imports. These tariffs often contribute to higher shoe prices for consumers at retail. This decision followed a statutory four-year review of Section 301 China tariffs, which went into effect in 2018 after a United States Trade Representative (USTR) probe found that certain China’s trade practices and policies were either discriminatory or burdened U.S. companies and workers.

In response to the decision, shoe industry trade groups spoke out against the burdensome tariffs.

“The President, much like his predecessor, seems to have an insatiable appetite to tax American families on the items they have to buy like footwear, clothing, and other basic goods,” FDRA’s president and CEO Matt Priest said in a statement. “These tariffs have had a significant impact on U.S. consumers, particularly working families and minority communities, costing an additional $20 billion since 2019.”

American Apparel and Footwear Association president and CEO Steve Lamar said in a statement that the extension of tariffs on a wide range of apparel, footwear and accessories is a “real blow to American consumers and manufacturers alike.” He called the tariffs “regressive taxes” paid by U.S. importers and U.S. manufacturers that are ultimately passed along to U.S. consumers.

The Footwear Distributors of America have a message for the Biden administration ahead of their announcement regarding footwear tariffs: get rid of them.

In a Monday letter sent to U.S. Trade Representative Katherine Tai and U.S. Secretary of Commerce Gina Raimondo, FDRA president and CEO Matt Priest urged the administration to eliminate the Section 301 tariffs on China, which he said have had adverse effects on American businesses and working class consumers who have had to grapple with higher costs.

The letter was sent on the eve of President Biden’s meeting with Chinese President Xi Jinping on Wednesday, where the leaders will discuss U.S.-China relations.

In August 2017, the United States began an investigation under Section 301 of the Trade Act of 1974 of China’s technology and intellectual property related practices that the United States believed adversely affected U.S. businesses. In 2018, the United States concluded that China was failing to make changes to those policies and practices and that punitive tariffs of up to 25 percent should be imposed. Thus, Section 301 tariffs were applied to U.S. imports from China of apparel, footwear, travel goods and furniture in 2018 and 2019.

“Hitting U.S. businesses and consumers with added footwear costs is incapable of changing Chinese behavior,” read FDRA’s letter. “China does not pay the tariffs; U.S. businesses and consumers pay the tariffs. China also does not include footwear as a key tenet of its industrial policy. If the goal of the tariffs is to incentivize U.S. companies to leave China, this simply does not work with footwear due to limited sourcing options.”

When it comes to footwear, Section 301 tariffs of 15 percent were imposed on about half of the footwear imported from China on Sept. 1, 2019. Those tariffs were later reduced on Feb. 14, 2020, to 7.5 percent.

FDRA, along with the American Apparel & Footwear Association (AAFA), the National Retail Federation (NRF), the Retail Industry Leaders Association (RILA), and the United States Fashion Industry Association (USFIA) in January released a joint study calling out the “detrimental economic impacts” the Section 301 tariffs on China have had on American businesses and consumers.

According to the study, higher costs and prices from the tariffs fell on U.S. companies and American families — and the tariffs also led to significant indirect costs, including those associated with attempts to establish bifurcated supply chains.

“Footwear is taxed at an average rate of 12 percent, while all other imported consumer goods are taxed at an average rate of just 1.9 percent,” Priest noted in the letter. “Footwear tariffs reach rates of 37.5 percent, 48 percent, and higher. In fact, some of the highest rates in the entire U.S. Tariff Code fall on low value shoes and children’s shoes, disproportionately impacting working class families at a time when they can least afford it.”

In October, FDRA found that footwear prices rose a modest 1.1 percent from a year earlier, the sharpest increase in eleven months.

In an open letter to President Biden on May 12, Matt Priest, president and CEO of the Footwear Distributors & Retailers of America (FDRA), again asked for the elimination of tariffs on shoes and other basic consumer goods to help lower recent price spikes on kids’ shoes.

The Wall Street Journal, citing an U.S. official, is reporting that custom duties will be suspended for three months.

“This is something I asked the Trump administration to do over two weeks ago,” said Matt Priest, president and CEO of Footwear Distributors and Retailers of America. “If these reports are true, this is welcome news for our companies and workers during this historic crisis. Our industry’s leadership is working tirelessly, day and night, to create liquidity for their companies to try and ensure that when this is all said and done, they emerge ready to get back to work selling shoes and employing thousands of Americans.”

Priest called on Trump and his team to release details about the duty deferment as quickly as possible. The tariff issue has been at the top of the footwear agenda for the past several years amid countless developments in the US-China trade relationship.

While today’s stimulus package was good news for the industry, it has been a brutal week as vendors and retailers grapple with continued store closures.

The key elements of stimulus measure include $500 billion for loans, loan guarantees or other assistance to businesses, states and municipalities, as well as $349 billion for the Small Business Administration to guarantee loans to companies and nonprofits with fewer than 500 employees.