Balsam Brands CEO on Tariffs, Supply Chain Strategy, and Holiday Shipping

Tariff Impact on Balsam Brands

• 💡 Balsam Brands, a leading artificial Christmas tree producer, faced significant tariff costs, paying $1 million last year with 0% on Christmas trees.
• ⚠️ Without tariff relief, the company projected paying approximately $115 million this year, a rate that would have made business operations impossible.
• 🎯 Thankfully, tariffs were reduced to 30% on Christmas trees, a rate that has allowed the business to continue operating.

Supply Chain Diversification and Shipping Strategy

• 🚀 The company began diversifying its supply chain during the first Trump administration and proactively shipped products for Christmas 2024 in November 2024.
• 📦 They also accelerated shipments before the April 2nd tariff increase, aiming to import as many Christmas trees as possible before higher rates took effect.
• 🌍 Diversification into other countries like Europe, Canada, and Australia has helped mitigate costs, with these markets showing double-digit growth.

Mitigating Costs and Consumer Impact

• 📈 Balsam Brands expects to pay around $15 million in tariffs this year, a substantial increase from $1 million last year.
• 💰 Additional costs incurred include storage fees for early imports and increased interest payments due to longer financing periods.
• 🛍️ To stay in business, prices have been raised by an average of slightly over 10%, with much of the cost absorbed through early imports, cost-cutting, and sadly, layoffs.
• ✨ A new line of sustainable trees made with recycled or plant-based plastic has been well-received globally.