Buying Keestar Sewing Machine 441 Directly From China..

[BDAZ]

 

Lets say a product currently costs $100 landed in the States. The importer will often mark the product up 50% to $150 to the whole sale distributor. Then The distributor would add 33%   with no new duty, then Trump slaps 25% duty. The product now sells to the dealers at $200. The dealer marks it up another 33% and it sell to the consumer for $266. Then Trump slaps 25% on the same product which now lands at $125, then sells to the distributor at $250, then to the dealer at $333 and the consumer then pays $443.

So I can only assume all of the sellers will have to increase their prices at least a little.  So the Trump tariff  causes the import to jump from a retail of $266 to $433!! More than "at least a little"! 

That's why trade wars are so insidious!  In addition, US companies who rely on China sales to make make a profit are dumping their products on the US market, for example Maine Lobsters. Canada immediately stepped in to fill the void! 

This is just a typical import to 3 tier distribution model but is common. It may not apply to Industrial Sewing Machines since they are a small market but expect consumer prices to jump significantly next year. Hello tax cut..goodbye income!

Bob

 

[JJN]

4 hours ago, BDAZ said:

on the same product which now lands at $125, then sells to the distributor at $250

It looks like you have a 100% markup, not 50% from importer to distributor on your tariff calculation. So it should be $266 pre-tariff  increases to $332 with tariff.

[chrisash]

Not sure about the USA, but mostcountries already have a import tax on foreign commercial goods so it's not clear if for instance the new tax is

original cost plus import tax plus new tax 25% or

Original cost plus new tax (25%, which would be significatly different

[BDAZ]

We don't have VAT. A sales tax is added at the final point of sale to the consumer. All wholesale transactions are tax free.

[BDAZ]

1 hour ago, JJN said:

It looks like you have a 100% markup, not 50% from importer to distributor on your tariff calculation. So it should be $266 pre-tariff  increases to $332 with tariff.

Yup. My mistake. Was after a long day. But still significant 

[chrisash]

who mention VAT I was talking about your proposed new tax of 25% from Jan for China Goods. I believe but may be wrong but i think you have always had a import tax on all goods entering the states or nearly all

[LumpenDoodle2]

On 11/11/2018 at 12:26 PM, chrisash said:

who mention VAT I was talking about your proposed new tax of 25% from Jan for China Goods. I believe but may be wrong but i think you have always had a import tax on all goods entering the states or nearly all

It appears that the tarrifs are over and above all other taxes, not instead of.    The additional monies will apply unless a waiver’ is given for that range of goods, then a refuced tariff, on top of the original taxes will apply.   

 

[BDAZ]

On 11/11/2018 at 4:26 AM, chrisash said:

who mention VAT I was talking about your proposed new tax of 25% from Jan for China Goods. I believe but may be wrong but i think you have always had a import tax on all goods entering the states or nearly all

We don't have a VAT system in the US where taxes are included in the sales price, but are added at the time of sale to the end user. Sales tax is usually a combination of federal (as in petrol) state and local ad ons and usually amounts to +-10% except for petrol.

Generally these has been either no import duty or very little, maybe 1%-2%. 25% is a trade killer and is designed to make the import non competitive to product local manufacturers. The problem is that these days we have become so global that there is very little local production that doesn't include imported components because we have stopped making 100% of what is required, and Trump is to stupid and simplistic to understand that he is hurting US manufacturers and growers. A good example on the radio is that the manufacturers of steel cord for radial  tyres (tires) uses specialized steel form Japan and Germany because no one in the US makes the equivalent. They applied for an exemption to the tariff but a small domestic  steel company filed a protest, one of thousands they filed, even though they cannot produce a similar steel. The system is broken and presided over by an idiot..

Bob

[kgg]

I wonder does the tariff apply just to sewing machines made in China that are shipped directly to the US verses machines made in China shipped to Canada branded by a seller and then shipped to the US.

kgg

[brmax]

Many countries or we can just say places have general fees or taxes as a standard. I understand tarrifs are a form of these in some language. 

In a better description I think. Tarrifs are in one way or the other, a levy.  In that being more specific to a purpose. There are many different aspects of its effect. Actually both sides is seen, in every home. 

In essence its seen to help their public in some economic strategy. As we know this thinking is and usualy best considered for their total, public citizens.

 

Just my opinion, have a good day!

 

Floyd

[BDAZ]

26 minutes ago, kgg said:

I wonder does the tariff apply just to sewing machines made in China that are shipped directly to the US verses machines made in China shipped to Canada branded by a seller and then shipped to the US.

kgg

Generally  import tariffs are based on origin rather than where they arrive from. There would have to be a significant component of Canadian content to supersede Chinese origin, though Canadians tariffs may also be 25% . There is a lot of wiggle room  for cheating where products are made from, say Chinese fabric made from US cotton is then sent to Vietnam for basic assembly, then to say France  or the US for final finishing and packaging.  With a sewing machine, there's not much one can fiddle.

Cowboy could import the parts (often lower duties on parts) which does not include added labor costs, and then do final assembly in the US  but that may be even less competitive. 

The problem with these tariffs is say a US company wanted to set up a leather factory here because imported leather products have a 25% duty and have become expensive. All the equipment, qwhich is no longer made here will be 30%-40% more expensive,  labor,, etc. is also the same issue, so he would have to be more expensive than possibly  imports WITH the extra duty. 

The introduction of these tariffs is something for senior economists to consider rather than a circus barker shooting from the hip, and hopefully will disappear in 2020 along with the circus that initiated them.

[Constabulary]

1 hour ago, BDAZ said:

and hopefully will disappear in 2020 along with the circus that initiated them.

[SolarLeatherMachines]

On 11/10/2018 at 8:44 PM, BDAZ said:

This is just a typical import to 3 tier distribution model but is common. It may not apply to Industrial Sewing Machines since they are a small market but expect consumer prices to jump significantly next year. Hello tax cut..goodbye income!

Yes, this is correct.  We had to apply approx 8% to our final pricing to address tariffs.  So we ate a little bit ourselves, and had to tighten our belts around here.      

In January, the tariffs will jump to 25%.   Which means that the government just took your $1 bill, and gave you back 75 cents.   

People are gonna start getting hungry, because manufacturing just ISN'T gonna come back in the next 5 years.  or 10 years, really.   Overseas jobs started to become a problem in the early eighties (remember that michael keaton movie "Gung Ho"?)  and it's been almost FORTY YEARS SINCE.  It's going to take that long to change.  If it even does.  

[dikman]

Not just America, our manufacturing industry here in Australia is a mere shadow of what it once was, with no sign that it will ever come back. Once it's gone, it's gone.

[gottaknow]

The company I work for is a DoD contractor. Everything we produce for them has to be Berry Compliant. This assures US made textiles, including all the raw materials. I began working in a sewing factory in 1980, even then companies were exploring overseas options. The price of industrial machines has little affect on our bottom line as the ROI is very quick, long before the typical depreciation period. We also bypass the US dealers at a substantial savings.  For the home hobbyist, a much bigger impact. We do import the vast majority of our non tactical items in order to compete in a very competitive market. NAFTA hurt the US textile businesses but it was the low overseas labor costs that really sank our ship.

Regards, Eric

[brmax]

Totally agree on the labor cost. I do believe this is the key item. Im not anywhere clear on annual salaries of far east country labor markets.

Though im likely to think just my annual health insurance premiums are near the far east annual salaries. ( just premiums )

But thats just my guess and opinion.  

 

Good day everyone

Floyd

[chrisash]

It's a constantly changing senario, with undeveloped countries offering low cost items due to cheap labor costs and then its own market develops and makes costs increase and the buyers move to the next lower cost area and so on, China has seen massive cost rises over the last decade and other countries less developed in the area are taking parts of its work at cheaper prices. The UK was the worlds largest ship builder then it all went to Japan and now Korea has taken most from Japan

[BDAZ]

Just heard on the radio that the "Walmart Effect", increased consumer prices, is expected to wipe out any benefits of the tax breaks for the average consumer, and more. Doesn't effect the wealthy of course.

Bob