Trump tells Walmart to 'eat the tariffs' instead of raising prices

WASHINGTON: US President Donald Trump said on Saturday that Walmart should “eat the tariffs” instead of blaming duties imposed on imported goods for the retailer’s increase prices.

His comments were in response to the world’s largest retailer saying this week that it would have to start raising prices later this month due to high cost of tariffs.

“Walmart should STOP trying to blame Tariffs as the reason for raising prices throughout the chain. Walmart made BILLIONS OF DOLLARS last year, far more than expected,” Trump said in a post on Truth Social.

“Between Walmart and China they should, as is said, ‘EAT THE TARIFFS,’ and not charge valued customers ANYTHING.”

A representative of Walmart could not be reached immediately for comment.

Walmart Inc., the world’s largest retailer, operates approximately 4,700 stores in the U.S. and has a global presence, with a business model focused on “everyday low prices” for lower- and middle-income shoppers. Founded in 1962 by Sam Walton and headquartered in Bentonville, Arkansas, Walmart generates about 60% of its U.S. sales from groceries, with two-thirds of its merchandise sourced domestically and the rest from countries like China and Mexico. Its growing e-commerce platform and Walmart+ membership program enhance customer loyalty, but the company’s reliance on imports makes it vulnerable to trade policy changes, such as President Donald Trump’s 2025 tariffs.

Trump’s tariffs, including a 10% universal import levy, 30% on Chinese goods, and 25% on imports from Mexico and Canada, significantly impact Walmart by raising costs for electronics, toys, clothing, and imported produce like bananas and avocados. Walmart has confirmed price increases starting late May 2025, with more expected by June, as its thin retail margins limit cost absorption. The company is pressuring suppliers, particularly in China, to cut prices by up to 10%, but resistance from Chinese suppliers and government intervention complicates these efforts. Walmart is also diversifying its supply chain by sourcing from countries like India and substituting materials (e.g., fiberglass for aluminum), though limited alternatives for some goods, like imported food, pose challenges.

Despite these pressures, Walmart’s scale, two-thirds domestic sourcing, and strong Walmart+ program provide a competitive edge, potentially allowing it to gain market share as smaller retailers struggle. However, tariff-driven price hikes, combined with declining consumer sentiment and recession fears, could strain its lower-income customer base. Walmart’s stock has seen volatility, dropping 8% after initial tariff announcements but recovering 9% after a 90-day tariff pause in April 2025. CEO Doug McMillon’s meetings with Trump highlight the risk of supply chain disruptions, yet Walmart’s history of navigating crises and investments in low prices and technology position it to adapt, though rising costs and political scrutiny remain significant hurdles.