The recent imposition of tariffs with some of our largest trade partners have left many American companies with a big decision to make: raise the price of products to cover new costs, or take the financial burden upon yourself?
For some, the decision may obviously be the former; however, there is a company that is going against the norm and looking to change that.
Master Electronics, headquartered in Phoenix, provides electronic components to major industrial, medical, military, aerospace and consumer groups around the world. The goal of the business is to offer a variety of part numbers that are of exceptional quality, thus giving their customers an extensive breadth of options.
With the changes that have occurred, Master Electronic has chosen to take the brave and uncommon stance of not passing along the costs of tariffs to their customers.
“I want to help our customers and businesses not have disruption and cost issues and I am willing to do that and help them, which in the long term is going to help them feel good about us,” Riad Nizam, president of Master Electronics, said.
When Nizam was asked how they are managing this new cost, he described that, “really, it is kind of business as usual.” However, he also added, “we are definitely looking at ways to mitigate some of the costs, especially with our export business.”
Master Electronics has found that they are able to take on the short-term costs in hopes of seeing a long-term payoff. “Now we have customers that trust us more, that are willing to do more business with us than they were willing to do in the past because we were able to help them in a time of need,” Nizam said.
Nizam explains how keeping prices as-is despite the tariffs could be a marketing strategy for some of their other products and services that may have not otherwise been considered.
For other companies that are looking to follow in Master Electronics’ footsteps, Nizam suggests developing partnerships with companies that have already put these ideas into motion. He also expressed that companies should plan their supply chain accordingly.
Doug Bruhnke president of the Global Chamber commended Nizam’s approach., “It takes a courageous and customer-focused leader to absorb these significant tariff costs,” Bruhnke said. “Anyone taking this track should speak with one of our member experts first to better understand what is expected.”
Master Electronics’ promise is that regardless of the tariff costs, the price of their products will remain the same under regular market conditions.