Shoe Tariffs & New Balance

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New Balance, which has it’s headquarters in Brighton, MA, has been busy lobbying and pushing for our Government to keep the $3-$5 tariff on sneakers to remain in place.

Companies such as Nike, Adidas, and Reebok, to name a few, produce less than 10% of their sneakers in the United States compared to New Balance’s 25%.

IMG_8972A company such as Nike manufactures their sneakers in Asia to reduce production costs, sometimes a much as 35%, while selling those same sneakers at a huge mark-up.

One of the other reasons for the push to end US shoe tariffs is rising labor wage costs in China, where the cost has risen 20% since 2007.

For New Balance, the end of US shoe tariffs would hurt profit margins and make the brand less of a competitor with their “Made in the U.S.” sneaker line. New Balance has 1,350 employees in U.S. factories producing sneakers. New Balance also takes advantage of its U.S.-based factories by offering custom sneakers starting at $115 a pair in an assortment of colorways and materials with a shipping time of four to five business days. In addition, New Balance is also committed to hiring employees who have been laid off from other closing shoe factories in the U.S.

 The Wall Street Journal  wrote:

We think that the U.S. government should think long and hard about eliminating the sneaker tariffs that companies like Nike are required to pay now. While we certainly don’t want to pay anymore than we already do for sneakers, we also don’t think it’s fair for companies who have taken their factories to other countries to get a break simply because those countries are now forcing the companies to pay more in labor costs. So, rather than cutting tariffs, why not offer incentives for some of those companies to bring their factories back to America? We could sure use it. And, while that option would also impact New Balance, it would at least be beneficial to the national economy and show that the U.S. is serious about bringing factory work back to this country.

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About Dee Wells

Dee Wells maintains the blog Worcester Is MAJOR! and writes about various topics that have an affect on people living and working in Worcester, MA. Dee is a Co-Founder of Future Focus Media Co-op and the Central Mass Film Festival (CMF2), as well as serves as the Founder of OSD-Obsessive Sneaker Disorder which works with clients in the athletic footwear field.
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