- cross-posted to:
- usa@lemmy.ml
- cross-posted to:
- usa@lemmy.ml
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I don’t need a new keyboard, but daaaaaaaamn…
I have one of these keyboards. They are fucking awesome.
Let’s be real: we would rather make our products in the USA. Doing business in China is hard: a different language, a different culture, a different legal system, and a very long and expensive plane flight every time you have to pop over to help fix what’s gone wrong. So why don’t we make keyboards in the USA instead—and why don’t the vast majority of consumer electronics manufacturers, be they big or indie?
Most of our electrical components are made in China. Sometimes we’ll use or consider components not made in China—and they’re made in Japan, Taiwan, or Germany. The USA doesn’t make the components we need.
Making keyboards is intrinsically a cross-border activity. (For us, some of that activity involves shipping American goods to China! We make a number of products that use American wood. Unfortunately, China has just announced they will now tax that lumber at 34% in a retaliatory tariff.)
We’re a small company making niche products; we don’t have the volume to justify opening our own factory. We definitely don’t have the capital to do it. We rely on contract manufacturing, where we pay a network of factories to make products to our specifications, without us owning the machinery or hiring the workers ourselves.
Southern China, Guangdong and Shenzhen in particular, have developed an ecosystem of factories and suppliers within a small radius. Within about thirty miles, we work with a bunch of factories who are specialized in doing low volume production runs. Having so many companies close together saves a lot on transportation and freight. More importantly, it allows for local competition and sharing of knowledge—just like greater Los Angeles is the best place to make TV and movies even though other cities offer incentives, Guangdong is the best place to make consumer electronics.
The effects of the tariffs.
So they’re not even based in British Indian Ocean Territories?
make chagos great again
But… Just a thought, what if it’s manufactured somewhere else. Maybe it’s time to find another source.
Read it and you’ll find out
Lots of Nazi’s in this instance today. Is truth social down?
MAGA Nazis who don’t understand how manufacturing works… which is hilarious since Germans are great at it.
Okay. I’ll keep up with the keyboards I’ve had for years now (none of which come from this company), and I’ll wait until everything gets back onshore. And if that’s not possible, either work with other nations that the US government wants to work with, or let the market decide the value of those goods.
if that’s not possible, either work with other nations that the US government wants to work with
Oh, about that…
An open letter to companies, “What if you didn’t pass the entire burden onto your customers?” Oh wait, your profit margins are more important. Go fuck yourselves, I’m not buying your shit.
Why would they when they can just sell to literally every other country on earth instead
Agreed and I hope they do and succeed. This is a community about US news though. Curious the rush to their defense.
If Americans didn’t make their problems everyone else’s we wouldn’t care about or comment on your politics.
For sure, participate but it’s valid to call out US company’s behavior here. The US and their companies can burn, I have no love for either. Why are you coming to their defense?
I don’t love exploitative companies either (this one seems to be on the smaller side and exploring all avenues) but why would they willingly lose income that they probably rely on to live for some sort of greater good when they can just advertise in different markets especially when they’ve already done the legwork of setting up production in China. Even the most ideologically comitted business owners wouldn’t willingly lose money unless they were doing it for PR (We’re not just talking about losing out on profit at a 104% tariff rate)
Sure that’s pure business logic. I want nothing to do with it and reject their attempt to boost sales by hiding a marketing stunt within a empathetic-sounding letter. If that’s your speed, do it. Scoop up a key board. I, however, will not be buying their shit.
We’re in a fight. There are only allies and enemies.
Yeah, it is a fight but I think you’re misunderstanding the sides involved. A small company with like 5-15 employees (just an example) also has mouths to feed. Larger multinational corporations can and have passed American tariffs costs along to buyers from other countries to “soften the blow” for American buyers and are usually better equipped to weather the storm by taking a hit to profits over the medium term than small businesses. At the end of the day, only business logic applies because the unfortunate reality is that no one cares if you can’t afford food or housing in most countries so benevolence is not an option for most.
Big-time “I don’t want facts, I want to be angry” energy here.
Under estimating how thin profit margins are if you aren’t apple
Seriously. People are dumb. That person clearly voted for this.
As a good faith answer to your question that I hope you read with an open mind -
Between the tariffs and what the tariffs have done to the market (reducing options for supply makes the market less competitive and increases demand in other ways), my industry’s publicly available market costs went up a few tenths of a percentage point shy of 50% in the last two months alone.
In my industry, to pay your bills (your rent, your taxes, your employees, your lights, your freight, marketing, R&D, liabilities, funds to replace equipment when it breaks, etc) you are targeting 25-30% “direct” margin - minimum, if you’re barely treading water - which is (sell price - material costs) / sell price. With that math, a company that was previously reporting a 40% margin (say ($100 - $60)/$100) that had a 50% increase in material costs is now making a 10% margin (($100 - $60x1.5)/$100 = (100-90)/100 = 10%). That’s bankruptcy.
That’s not considering that costs have been increasing for more than just the last 2 months - anyone with a wallet knows that already, our industry number is 80% YOY increase in basic costs (margin math: 40% ==> negative 8%) - or that the true costs of tariffs haven’t even hit yet.
We also cannot pass an 80% increase in costs on to our customers without literally triggering industry recession if not collapse. We can barely pass on 40% and “tightening belts” to make absorbing the other 40% possible (margin math: 40% ==> 16%, half the general target) means good guys and gals with families lose honest, hard-working jobs. Even for a highly efficient business, being told the government is going to send you an extra 25-104% bill because fuck you, that’s why is going to be a heart attack level shock.
This is local manufacturing - the exact businesses who tariffs are supposed to be encouraging to do business in the US. A LOT of manufacturing is like this - it turns out tariffing the ever living fuck out of literally everything includes raw materials that you can’t get here that manufacturers need. This is literally just for our divisions’ own internal numbers too - no CEO pay coming out of this. Administratively, we run a skeleton crew already to make sure our costs are competitive, and it costs us hard already in turnover due to burnout.
The number of meetings we’ve had trying to figure out how on earth we keep our doors open without crashing an industry and then closing our doors anyway has quite literally had people in tears in the board room.
Are there companies who will use this for profiteering? Absolutely, tons of them. The companies who have the luxury of doing so are either are “inflexible demands” (ie food and medical care) or extremely large monopolies. Smaller companies, “discretionary spending”, and highly competitive markets like mine are just going to hold their breath and try not to drown, raise prices where they have to, inevitably go out of business in droves, THEN get bought up by a large monopoly who will make an 80% price increase look like child’s play because fuck you, everyone else closed.
We don’t need to fuck ourselves, Trump is doing that for us, thank you. And yes, people without jobs or who have nothing left after groceries don’t buy a lot of luxury keyboards, especially after their costs go up significantly - something I’m sure they have considered once or twice or repeatedly at checks watch 2 in the morning when they wish they could sleep, if they’re having the sort of time we’re having here.
Why yes, companies should just eat a 104% tax for the mere privilege to put a keyboard or any other product of China in the hands of a US resident. The only companies that could survive any burden-sharing arrangement better than 20/80 are those cheap and unsafe Amazon products that don’t work, or are near monopolies and screwing you one way or another.
Maga cry so hard! No understand tariff!
The current tarrifs for China are set at over 100%. Do you think these sorts of small companies operate with 100%+ profit margins?
Let me guess. American public school?
Or did you just sleep though math class?
You missed the part where U.S. President Trump is enacting these import taxes upon the American people and businesses. If you want to blame someone, go right to the source.
why don’t they gift me the stuff i want 🥺
