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If they had listed a line item for tariff fees then I could see the argument and would say that any refunds should go to customers. By not listing a tariff line
by lsaferite 6mo ago
If they had listed a line item for tariff fees then I could see the argument and would say that any refunds should go to customers. By not listing a tariff line item, Costco absorbed the additional costs and likely increased prices. In that scenario they, Costco, are the ones that should be entitled to a refund.
This is the same if you walk the chain backwards. Suppliers to Costco that simply raised prices and internally absorbed the tariffs are the ones due a refund, not Costco. Suppliers that sent Costco and invoice with a tariff line item should be on the hook to refund Costco (which means they should be seeking a refund from the US)
- tasty_freeze 6mo agoAmazon did try to add that line item and the administration pressured them to remove it. And you are making a very big assumption that either Costco or their suppliers absorbed the cost of the tariffs. Because I don't have a link handy, one study I read said more than 80% of the cost of tariffs came from the consumer's pocket, not the supply chain.
- lsaferite 6mo agoWhen I say absorbed I don't mean they didn't raise prices. I mean they didn't just transparently pass those extra tariff fees on to customers as a line item. With that increase in base costs they either lower their margins and earnings or they increase prices to keep them in a stable range. They are a for-profit business so it's highly unlikely they'd simply absorb the increased costs and not raise prices. There may have been some initial elasticity where costs rose faster than price rose.