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Important Message from our President, Ken Abrahams
May 20th, 2019
To Our Valued Clients,
For any of you that follow the news you are aware of the trade war that has been escalating between the US and China over trade and tariffs. For many, this is nothing but a news story, but for FUN Enterprises and many small businesses this is a very real issue that is dramatically impacting our business. This past fall, the first wave of tariffs hit that resulted in a 10% increase in the cost of many of our products. We were able to absorb that hit and not pass it on to you. This June, the tariffs are set to jump 25% and could go higher as China has retaliated by raising tariffs on goods being exported from the US into China.
As much as we would like to absorb this additional rate hike, unfortunately, we are unable to do so. Over this summer, we had planned to review our prices as we prepared for the fall/winter of 2019 and the spring of 2020 and we are still going to do that; but on June 1st we will adjust our prices on only the programs that use goods that are impacted by the increased tariffs. Luckily the products/supplies from China are only a portion of the total price and will be the only piece that is subject to the increase. In other words, this will not be a 25% overall increase, we are working diligently to keep prices as low as we can. We have already started to receive notices from our vendors that they will be raising prices immediately, but we will hold off until June 1, 2019.
Compounding the issue is availability. Not only are higher costs on these products immediate, but in some cases, we are seeing inventory levels depleting, some of the products completely out of stock and our suppliers have no idea if, nor when, they will be back on the shelves. We try to use products made in the USA, but many of our most popular items are, in fact, made in China or utilize components that are made in China. We have already learned that the slates we use are completely sold out, as are the Fanny Packs we airbrush on. When we accept dates for programs, we try and check on supplies first; rarely is this an issue, but we have several items that are now out of stock or running low. What is happening is that some of the larger distributors are stock piling supplies to avoid low or no inventory and Inventory control systems are delayed in updating their systems. This is a roundabout way of saying please bear with us.
If tariffs, in fact, go back to their “normal levels,” we will not be charging the increased supply fee but for right now, as of June 1st, we will be adjusting our prices to combat these hikes. If you have any questions, please do not hesitate to reach me or other members of our organization.
FUN Enterprises, Inc.