On Sunday, the toy maker Hasbro was preparing big changes to contend with triple-digit tariffs on Chinese imports.
By Monday, all of those calculations were different.
Gina Goetter, Hasbro’s Chief Financial Officer and Chief Operating Officer, said that President Donald Trump’s decision to temporarily lower tariffs on China from 145% to 30% drastically altered the company’s plans. She called the announcement a “pleasant surprise” at JP Morgan’s Technology, Media, and Communications Conference.
“A 30% world is very different from a 145 on how we’re treating decisions like pricing, how we’re treating allowances, how we’re working with our retailers on promotions,” Goetter said at the conference on Wednesday.
Agility, she said, has been key in making decisions in the current environment.
Hasbro, which produces Nerf guns and Play-Doh, had been planning to change the pricing of some products when the 145% tariffs were in place, Goetter said.
Now, many of the pricing moves have been paused, though Goetter said some will still go through where it makes sense.
“What Monday’s announcement allows us for is to go back to those products where we were taking pricing and be very thoughtful,” she said.
Beyond upping some prices, Hasbro had planned to stop making some products altogether because the new manufacturing math simply didn’t work. Goetter said on Wednesday that the company had also been planning to take an unprecedented move and produce some items only for international markets.
Plans to reconsider manufacturing are now themselves being reconsidered, Goetter said. Hasbro makes many of its board games in the US, she said, and though the company is “actively exploring” what else it can produce domestically, Monday’s announcement changes that calculus as well.
Ultimately, Goetter said the math is just quite different, at least for now. Hasbro had previously predicted that 145% tariffs could shave off $180 million from the company’s yearly net profits, and Goetter said that the new 30% tax brings that closer number to between $50 and $70 million.
Given that the current agreement is temporary and the trade environment remains volatile, Goetter acknowledged that no decision is final.
“In the tariff world, every day is a new adventure,” she said.
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