Key Points:
- McCormick & Co. raised its projected tariff impact for 2025 to approximately $140 million due to existing and new tariffs, with new tariffs accounting for two-thirds of the levy impact in the third quarter.
- The company plans to offset the impact through productivity savings, alternative sourcing, and pricing strategies in 2026.
- McCormick has been navigating tariffs since April and has managed to mitigate the impact by raising prices and shifting procurement to lower-tariff countries.
- The company’s global manufacturing strategy, resilient supply chain, and collaborative efforts have helped mitigate the impact of tariffs and maintain business momentum.
- McCormick faced rising commodity prices in the first half of 2025, which accelerated in the third quarter, leading to increased inflation.
- Tariff uncertainty has caused suppliers to pause, affecting the forces of supply and demand.
- McCormick has expanded its distribution points in the Americas and gained traction in high-growth channels like e-commerce.
- Other brand manufacturers, such as WD-40, Colgate-Palmolive, and Clorox, have also implemented strategies to mitigate tariff impacts.
Insight:
McCormick’s efforts to navigate the challenges posed by tariffs have been ongoing since April, with the company implementing various strategies to mitigate the impact and maintain business momentum. The company’s focus on productivity savings, alternative sourcing, and pricing strategies for 2026 highlights its commitment to overcoming tariff-related challenges.
Other brand manufacturers have also taken steps to address tariff impacts, emphasizing the importance of proactive measures in dealing with trade uncertainties. McCormick’s approach to tariff mitigation serves as a testament to the company’s resilience and adaptability in a dynamic global trade landscape.
Overall, McCormick’s proactive stance towards tariff challenges underscores the importance of strategic planning and adaptability in the face of evolving trade dynamics. By leveraging its global manufacturing capabilities and resilient supply chain, McCormick continues to navigate the complexities of tariffs while maintaining its competitive edge in the market.