The president of Japanese clothing retailer Uniqlo threatened to close its U.S. stores if President Donald Trump creates a policy that forces the company to manufacture its products in the United States. Speaking in New York last week, Tadashi Yanai, chairman and president of Fast Retailing, which owns Uniqlo, said he would “withdraw from the United States” if the policy was implemented. “We wouldn't be able to make really good products [in the U.S.] at costs that are beneficial to customers,” Yanai told Japan’s Asahi Shimbun. “If [manufacturing products in the U.S.] is not a good decision for consumers, it's meaningless to do business in the United States,” he added. At 50 stores, Uniqlo's presence in the U.S. is fairly limited. Still, Yanai said he hopes to open 20 to 30 stores per year.
Total Retail's Take: President Donald Trump has threatened to impose a tariff on foreign imports coming into the U.S. as part of his campaign promise to revitalize American manufacturing. However, retail executives are fearful that the measure could significantly increase their production costs, which would in turn lead them to passing on the price increase to consumers. “At the end of the day, to tell American consumers to pay 20 percent more for apparel, footwear, home goods, I don’t see that being a good thing and it doesn’t make any sense to me,” said Kevin Mansell, Kohl's CEO and president, at Shoptalk last month. “Higher prices will minimize demand. The thing I know for sure is that prices are going to go up a lot.”