DTC Briefing: How brands like Yeti and SharkNinja are thinking about tariffs as they build forecasts

What is currently crippling the industry at large is an inability to plan, as new tariffs are announced one day and postponed the next. Publicly traded companies, of course, are trying to put as positive of a spin as possible on their outlooks for next year. But it still gives privately-held DTC startups some idea of how others are trying to plan for the year, as, behind the scenes, brands are struggling to figure out what to do.

“Everything that has been announced so far has been written in pencil, rather than set in stone,” Simeon Siegel, managing director and senior analyst at BMO Capital Markets said, when asked to describe what kind of predicaments brands face right now.

“The lack of any ability to plan is crazy right now,” said an executive at one DTC apparel brand, speaking on the condition of anonymity. 

Here’s the state of play: On Feb.1, President Donald Trump announced that he would be implementing a 25% surcharge on Mexican and Canadian imports, as well as 10% tariffs on China imports. A few days later, he punted on the Mexico and Canada tariffs, delaying them for a month. The China tariffs, however, went through.

Alongside these tariffs, a new clause was imposed that canceled the de minimis trade exemption, a trade rule that let companies import goods valued under $800 duty-free. Then, on Feb. 7, Trump delayed this cancellation until “adequate systems are in place to fully and expediently process and collect tariff revenue.”

Since then, there have been new tariffs imposed. There will be 25% tariffs on all steel and aluminum imports, effective March 12. Finally, on February 13, President Trump signed an executive order enacting reciprocal tariffs — that is, stating that if a country imposed new tariffs on the U.S., it would issue tariffs right back. 

It’s a lot for brands to keep track of — and the tricky part is that nobody knows exactly how long some of these tariffs may last. Here is what some brands and other e-commerce companies had to say about tariffs in their quarterly earnings calls last week. 

Yeti, which sells coolers, drinkware and other accessories, and does nearly 70% of its business from DTC sales, said during its fourth-quarter earnings call on Thursday that it was not yet including tariffs in its full-year outlook. 

The brand’s CFO, Mike McMullen, said during the Q&A portion of the earnings call that Yeti thinks the 10% tariffs on China “could have less than a $10 million impact on the year, in terms of additional cost.”

That $10 million wasn’t accounted for in Yeti’s forecast for a few reasons, he said. “It’s obviously a very fluid, dynamic situation. And … we view that as a manageable number that we are going to continue to work [through], and we’re going to do that via additional cost optimization.” He also said that price increases weren’t off the table if Yeti felt like the brand needed to raise prices to deal with tariffs. 

For appliance brand, SharkNinja, which sells everything from vacuums to blenders to beauty tools, tariffs were a bigger topic of discussion. As SharkNinja CEO Mark Barracoas put it in an interview with Bloomberg, there’s no supply-chain for U.S.-made blenders, so SharkNinja pretty much has to source its products from places outside of the U.S. SharkNinja has set an interim goal to source 90% of its products that come from outside of the U.S. from places other than China by the end of 2025. 

During its fourth-quarter earnings on Thursday, SharkNinja was still projecting that sales would grow as much as 12% this year, even after factoring the China tariffs into its forecast. The company also predicted that adjusted earnings per share would increase as much as 15%, even as SharkNinja stocked up on more products to get ahead of China tariffs. 

“We continue to strategically leverage our balance sheet to proactively build inventory helping to mitigate potential P&L impacts from new tariffs. As a result, we expect inventory levels to remain elevated through the first half of the year before normalizing in Q3,” SharkNinja CFO Patraic Reagan said. 

Meanwhile, Shopify, which reported earnings on Wednesday, implored people to think of the small businesses being impacted by all of these changes. 

“We think protections like de minimis are crucial for small businesses that engage in trade,” Shopify President Harley Finkelstein said. “Countries should really try to streamline these custom processes.” 

It is worth nothing that the brands like Yeti and SharkNinja that reported earnings last week sell big, bulky products that are less likely to be shipped in under de minimis exemptions. 

Meanwhile, for many smaller DTC startups, “the entire e-commerce supply chain is quietly exploding,” the DTC apparel executive said. 

This executive’s brand has slowly started to test price increases to see how that could impact conversion rates, but it hasn’t committed to any major changes yet. Many that have logistics partners in Mexico have also been caught in the crossfire as Mexico also restricted its de minimis exemption in December. The executive also wondered how the lack of ability to plan right now could impact startups that may have been hoping to IPO this year, like Vuori or Skims. 

More light will be shed on the issue when more pure-play DTC startups like Warby Parker and Figs report earnings over the next two weeks. 

Siegel from BMO Capital isn’t surprised that most companies aren’t yet working tariffs into their forecasts. As the head-fake on the Mexico and China tariffs show, companies won’t likely know until the last minute whether these tariffs are going to actually be implemented and how long they will last.

“To make a structural change to a potential temporary challenge is a very difficult thing to justify,” he said. –Anna Hensel

Digging into Grove Collaborative’s recent acquisition 

Sustainable products marketplace Grove Collaborative recently announced an acquisition of Grab Green, a cleaning brand featuring made-in-the-USA, non-toxic products. A company spokesperson would not share the purchase price or elaborate on which assets the purchase includes. Grab Green has been a top-10 third-party seller on Grove since 2021 and has consistently grown its sales year over year. CEO Jeff Yurcisin told Modern Retail in an email that Grove sees acquisitions as a way to efficiently use its capital while expanding its portfolio of owned brands into new or nascent categories. He also hinted that future purchases could be on the horizon. “We regularly ask our customers about what they’re looking for from Grove that we’re not offering today, which has led us to explore acquiring companies and brands that allow us to better serve those customers’ needs,” Yurcisin said. –Melissa Daniels 

Quote of the week 

“[Shooting in Thailand] was the only way we could really do this authentically. We could have done [the shoot] in different ways. But I really wanted people to feel like they were going to Thailand and they were a part of it — [so that] even if you’re in the heart of New York City and it’s 20 degrees in January or February, you can have the experience of going to the ‘White Lotus.'” 

– Caroline Danehy, co-founder and chief brand officer of swimwear brand Fair Harbor, discussing the brand’s campaign shoot for its new “White Lotus”-themed, Thailand-inspired swimwear collection.

More here on how White Lotus-themed products became the new Barbie collaboration and why more brands are pursuing pop culture tie-ins, generally. – Julia Waldow 

What I’m reading 

• Amazon is testing a new feature where it will direct customers to another brand’s website if Amazon doesn’t carry that item, which could open up a whole new advertising stream for the e-commerce giant. 
• The Poppi influencer vending machine drama, explained. 
• The Business of Fashion has a look at what’s causing the beauty slowdown. 

What we’ve covered 

• As Dr. Bronner’s drops its B Corp status, brands weigh the pros and cons of the certification.
• The rise of the menopause market.
• Why more startups embraced self-care messaging this Valentine’s Day.