Begun these trade wars have. Over the weekend President Trump made good on his promise to impose 25% tariffs on goods coming from Canada and Mexico, and an additional 10% tariff on Chinese imports. Canada, incensed over suggestions that they will become the 51st state, and other insults to what was once our closest ally, fired back with a 25% tariff of their own on US goods, and here we go.
Gina Gagliano spoke to many comics publishers about what tariffs might mean for comics and it is all bad. The 25% increase is on the cost of goods, not the final price, but it would still lead to an increase:
He told me it’s slightly more complicated than that. “The total amount paid in tariffs is based on the customs value when the item is imported, not the item’s ultimate retail value. Customs value typically includes other costs beyond materials and manufacture, such as shipping and insurance. However, to keep things simple we’ll use the $1.00 value to illustrate how the increase in a tariff rate can have a substantial impact. Under current law, at the 7.5% rate the tariff would be 7.5 cents per book – $1.00 x .075 – for a total of $1.075. A 100% tariff rate would effectively double the cost at the border – in addition to paying $1 for the book itself, the publisher would also pay an additional $1 tariff for a total of $2.”
His conclusion: “this would likely lead to a significant increase of the sale price.”
Gagliano’s piece mostly spoke to indie publishers who print their books in China, but the effect on periodical comics could be even worse: most are printed in Canada and even those that are printed in the US use Canadian paper. Expect the price of periodical comics to go up.
Given that after just two weeks in office, President Trump has unleashed never before seen chaos on the US government, it’s not clear exactly when the tariffs will begin to have an effect on pricing (they’re now set to go into effect on Tuesday) – and quite frankly, it’s not just comics, but food and energy, so people will have a lot of things they might need to cut out of their budget.
We’ve also been talking to many comics publishers over the last few weeks, mostly about the effects of the Diamond bankruptcy – which was already going to put a huge crimp into the DM. But now we’re starting to hear a new layer of anxiety about the tariffs.
To say that these are uncertain and unprecedented times is a huge understatement. The direct market and book publishing are about to undergo massive changes, and we’ll continue to report on them as they unfold.
Photo By: Kaboompics.com
