The future of Hobby Lobby in the face of the Trump Administration’s tariffs is pretty uncertain. Hobby Lobby absolutely depends on imports for its inventory and the prices of those imports could easily skyrocket under the Trump Administration’s tariffs. With supposed tariffs of 10%, 20%, or 60% in the case of China the Trump Administration could send Hobby Lobby into bankruptcy.
I cannot emphasize enough that Hobby Lobby depends on cheap imports. If people had to pay the sticker price of the products in store without discounts nobody would come. And that’s exactly what we’re talking about. Hobby Lobby will have to charge sticker price for everything in the store because of just how astronomical the Trump Administration’s tariffs are.
Tariffs of 10% or 20% are very painful to consumers and will disproportionately effect the impoverished. Since the upcoming Trump Administration has not made their intentions clear we have to assume 10% and 20% tariffs are meant for friendly countries and the 60% tariffs are for China and anyone else who pisses off the Trump Administration.
Now it’s important to remember Hobby Lobby imports seemingly everything. Just how much they import is not disclosed but judging by all of the “Made in China” tags on their products it is a significant amount.
And the fact that so many products in Hobby Lobby’s store are made in China is a big deal. A 60% tariff does not equal a 60% rise in prices… it actually means prices most likely will rise BEYOND 60% due to the increased costs of compliance and corporate greed. That 60% will wipe out any profit Hobby Lobby may have, they’re a private company and do not disclose financial information, so they will absolutely have to raise prices.
I wish Hobby Lobby did disclose financial data but the best I can give you is that Hobby Lobby MIGHT make $8 billion in revenue per year, has 1000 locations, and 43,000 employees.
But that destroys Hobby Lobby’s whole business model. Hobby Lobby needs cheap crap to get people through the door. That’s the whole store, that’s it, cheap crap… it’s not like Walmart where yeah they have cheap things but then they’re ripping you off on say candy without you ever knowing it.
The Trump Administration will more likely than not make no exceptions to tariffs. At least not when it comes to hobbies, Christmas ornaments, and crafts. Hobbies and crafts are not a priority under any Presidential administration let alone the Trump Administration. The same is true of Toys and Games which I’ve talked about.
That’s what leads me to believe that if the Trump Administration actually goes through with tariffs, and 60% tariffs on Chinese products, Hobby Lobby is lost. Their revenue and profit will fall drastically and bankruptcy will be inevitable unless there’s tariff relief. Hobby Lobby will be one of the many victims of the Trump Administration.
I will say that Hobby Lobby is a private company and does not report financial data. It is pure speculation to talk about their financial state and any forward looking statements are a matter of opinion.