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I disagree how much profit they make. Many of the managers make quite a bit and pay little in labor. Yes it’s FOB China port but a large importer will dictate price on next order. It may be less than 10% but factories don’t want them moving to SEA in some cases.
You can't say that they make money but that the importer dictates the price. These statements are contradictory.
The other data point that is interesting is how low inflation has been. And the impact on China.
Well...inflation lags tarriffs and I don't always trust the numbers but agree generally. We're seeing inflation in our prices but because of china. It's because of freight and delivery costs.
Re. Labor cost, analyzing some cost components for products I was surprised with the pool that went to management. The reality is going to be negotiated my guess and will vary.
In my previous company, we worked with factories. We have teams in China that would go over how they made the product. If there are ways for them to make it cheaper, they will work on that including profit. Normal work. I imagine this intensifies with the surcharge.
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