The trade tensions with China are impacting a wide variety of industries. This is in part because China already plays a predominant role in the world’s overall economy.
One particular article highlights this point went it comes to exportation of Christmas products. The city of Shanghai has approximately 600 factories that produce well over half of the Christmas products manufactured in the world. Vendors sell these items in Shanghai at a wholesale market that is close to two square miles in size.
How this impacts the U.S.
Considering that China sells 90 percent of Christmas-related lights and ornaments to the U.S., talks about tariffs and trade wars will definitely influence the market. While Christmas is still months away, it is during the summertime that vendors will usually place their orders.
Though such products do not yet face tariffs placed by American officials, there are already major concerns that this may occur. Many products are already showing a slump in sales due to these concerns.
There has been a certain amount of success for certain vendors. For example, one particular vendor already has a number of clients that they keep in contact with. So proper business planning can somewhat alleviate concerns. But it is difficult to predict what will occur when currently prices are rising.
Even products not directly subjected to tariffs may be difficult to export should a trade war occur. Shipments may be held up. Vendors of products may also face an increasingly regulated market.
Vendors need a certain amount of supplies to create their products. Yet costs have also risen for manufacturers in order to comply with specific Chinese regulations. This means that profits are getting smaller for vendors and manufacturers alike.
For American companies hoping to gain a foothold and invest in the Chinese market, understanding how to avoid delays and expense is difficult without understanding Chinese business customs. Having legal counsel on your side who can accurately assess the Chinese business climate is invaluable.