How companies can survive prices without increasing prices: Pwc Expert

The companies faced by the aggressive prices of President Donald Trump have a key question to answer – do we make the cost of customers?

This do not solve all problems for businesses and, in some cases, can alienate buyers concerned with costs.

Kristin Bohl, a PWC partner for customs and international trade that directs the Big Four company advisory work, told Business Insider that there are many options to mitigate prices while avoiding price increases.

Although there are many options, three of Bohl’s best advice For surviving can be summarized as: Refund, postpone and reduce.

Obtain a refund

Bohl said that one option was to pay the prices but obtain a refund.

“If you import your products here in the United States and export or destroy these products later, you can claim a drawback of rights, which represents a refund of 99% of the rights paid for import,” she said.

Bohl said it was an extremely effective strategy for companies that had the de facto model required during China’s prices implemented during Trump’s first term.

For companies that are net importers, this option would be more difficult, she added.

BOHL also warned that not all prices are subject to a service drawback – the prices introduced in February, the 10% that was amplified up to 20% on China and Hong Kong, as well as the 25% in Canada and Mexico would not be eligible.

The new universal and reciprocal rates are eligible, she said.

Delay the payment of prices

Companies can examine how to postpone payment rates.

Things like stored storage or areas of foreign trade allow companies to bring products to the United States but to postpone payment of rights and costs until a product is withdrawn for consumption in the United States, the PWC expert in BI told.

“If it is re -exported, you never pay the prices. But if it is consumed here, you have at least postponed your payment, so there is an advantage of cash flows.”

Reduce the amount of prices

BOHL’s final suggestion was that companies examine how to reduce costs that cause prices.

Consider things like transfer prices or undressing to determine if adjustments can be made to finally pay lower prices, she said.

“When you import something today and declare your price, can you take off from this price which is not considered as quotes and not being part of your customs value?” Said Bohl.

Reduction is a point of development for many companies because it requires that many different departments in a company are part of the discussion.

There is no corrective at the size of

Apart from these three key areas, Bohl stressed that there were a wide range of potential solutions.

“There are a myriad of short -term strategies, no regrets, easy to relax up to fairly important investments in time and money to put these operational things.”

Managers must sit and determine where on this spectrum they fall, she said.

“It is absolutely not a unique answer.

A long-term option is to move manufacturing to countries with lower rates or even in the United States.

“Move your production or supply in a country that has no prices, which quickly comes from nowhere, or you make here in the United States,” said Bohl.

Companies can also have conversations with their suppliers about their ability to work together to absorb part of the price cost.

Currently, Chef PWC said most customers focus on short -term solutions. They reflect on long-term options but did not make long-term movements “because of uncertainty,” she told Bi.

As if to highlight this uncertainty on Wednesday, Trump announced a 90 -day break on the higher tariff rates that he introduced for around 60 of American business partners last week.

A 10% coverage rate remains in most countries, and prices on goods for China were 125%.

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