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Life in Trump's trade war brings chaos for corporate America

Matt Townsend, Bloomberg News on

Published in Business News

NEW YORK -- For Columbia Sportswear Co., President Donald Trump's escalating trade war has snatched away the most finite resource of all: time.

Although the outdoor-gear maker was largely spared financial pain in the first tariff rounds, the dispute has still sucked up hours and resources that it hadn't planned for. Budget meetings and strategy sessions have been getting derailed by the uncertainty. Added costs have popped up in unexpected places, like the price of mannequins rising about 5% because of levies on aluminum used in their frames. Making this more difficult is the fact that Columbia's production cycles stretch out 18 months.

"How do you plan?" said Peter Bragdon, Columbia's chief administrative officer and general counsel. "Uncertainty is the enemy of investment."

Unknowns for Corporate America increased in the past few weeks. The U.S. and China looked headed for a detente, but they failed to reach a compromise. So Trump ramped up the pressure by raising a wave of existing tariffs and starting a process to put levies on the remaining goods coming from its largest trading partner, from shoes to toys and smartphones.

Columbia joined other footwear giants on Monday in a letter urging Trump to reconsider.

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"There is a reason that trade policy is negotiated and set over the period of years, even decades. It has a significant impact on the orderly operation of the economy," Bragdon said. When asked about the trade war's latest twists and turns, he quipped: "Well, I haven't checked my phone in the last 20 minutes, is that still good information?"

Shoemaker Wolverine World Wide Inc. is also feeling the pain, even though its physical goods didn't appear on any tariff lists until last week. President of global operations Michael Jeppesen was visiting suppliers in the Philippines when he learned his job overseeing the production of 15,000 new products a year, including many in China, was about to get harder.

"I was miffed," said the executive at Wolverine, whose brands like Keds and Merrell have year-long lead times. "We need a certain level of visibility, transparency and predictability in order to plan our business in the most cost-effective way. If we are wrong on those assumptions, we will not be able to make the profit we planned."

Economic Risk

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