Ross Stores Considers Raising Prices to Offset Effects of Tariffs
News Summary
Off-price retailer Ross Stores is reportedly considering raising prices on some items to offset the ongoing impact of new U.S. tariffs. The company, which operates Ross Dress for Less and dd’s Discounts, stated that while tariff-related costs for the second quarter were lower than expected and are projected to moderate later in the year, it is evaluating price increases as a necessary strategy. Ross Stores Chief Operating Officer Michael Hartshorn indicated that price adjustments would be made on an area-by-area and merchant-by-merchant basis, providing flexibility to manage rising costs. A PYMNTS Intelligence report highlights that over half of payments heads at middle-market goods firms now believe tariffs will negatively impact their companies, a significant increase from previous months. In response, 63% of goods firms plan to renegotiate pricing with existing suppliers, and 53% intend to replace overseas providers with domestic ones, though 16% have taken no action. The article also notes that American businesses, after waiting to assess the impact, have begun making difficult decisions, including price hikes and potential layoffs. Business executives are reportedly no longer optimistic about a swift change in the Trump administration's global trade regime, now viewing the levies as a long-term shift by the U.S. government.
Background
By 2025, the Trump administration's protectionist trade policies, particularly the imposition of tariffs on imported goods, have become a long-term fixture of the U.S. business landscape. These tariffs, aimed at supporting domestic industries and rectifying trade imbalances, have simultaneously imposed significant cost pressures and operational uncertainties on American businesses reliant on global supply chains. Retailers, especially off-price segments that leverage low prices and value as competitive advantages, face the dilemma of either passing increased tariff costs onto consumers or absorbing them. The persistence of these tariffs has compelled companies to re-evaluate their sourcing strategies, supply chain configurations, and pricing models to adapt to this new trade paradigm. The general consensus in the industry is that tariffs are now a structural, long-term cost.
In-Depth AI Insights
Will off-price retailers raising prices fundamentally alter their value proposition and impact market dynamics? - Yes, for off-price retailers like Ross Stores, whose core competitive advantage is