McCormick CEO warns about harsh decision amid tariff threats | Official Website of Louis Velazquez, entrepreneur, finance guy and tech innovator

Imagine cooking a meal without seasonings and forcing yourself to eat plain foods to survive because purchasing condiments has become too expensive.

Not only would this rob us of the enjoyment of eating, but it would also prevent us from trying new flavors from other cultures.

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After taking office for a second term, President Donald Trump implemented new tariffs on foreign-made imports in April, including an additional 10% baseline tariff.

This has resulted in ongoing negotiations between foreign countries and the U.S., temporarily pausing increased tariffs on imported goods.

However, the clock is ticking, and the 90-day suspension of baseline tariffs expires on July 9.

Although some countries have reached agreements, others have yet to come to a mutual understanding. This threatens the supply chain of many products, which may lead to price increases.

McCormick’s CEO delivers some bad news for consumers.

Image Source&colon; McCormick & Company

McCormick’s business has been built on foreign goods

Companies have been strategizing and reorganizing their businesses, hoping to soften or prevent the potential blow tariffs might have on their finances.

However, many remain concerned about negative financial repercussions, especially in sectors highly dependent on imported goods.

McCormick & Company (MKC) is a leading manufacturer, marketer, and distributor of spices, seasoning mixes, condiments, and extracts worldwide.

After 136 years in business, the company has grown a portfolio of around 17,000 materials from over 90 countries.

Although an American company, McCormick depends on foreign goods. Many of its products are not commercially available in the U.S. due to factors such as geographic location and climate.

McCormick’s CEO warns consumers about price increases

The new tariffs have hit the decades-old business like a train, leading McCormick to reveal plans that American consumers had been dreading.

McCormick said it will raise prices during the fourth fiscal quarter of 2025, as the costs of certain products will be higher than expected.

“Our total gross annualized tariff exposure is approximately $90,000,000 and in terms of 2025 in year exposure, it’s about $50,000,000,” said McCormick CEO Brendan Foley in the company’s latest earnings call.

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However, the company will continue to look for lower-cost sourcing alternatives to keep up with demand and mitigate the tariff effects.

McCormick understands that price hikes could decrease sales, as it would prompt consumers to seek cheaper options.

“We are collaborating with our customers to implement surgical and strategic pricing, while also maintaining our volume momentum,” said Foley. “Overall, our manufacturing location strategy, resilient supply chain, global sourcing capabilities, collaborative efforts across the organization and the strength of our brands continue to be a competitive advantage, enabling us to mitigate our costs and maintain our business momentum.”

Although McCormick has focused on decreasing its reliance on any one geographic area, Foley still warned that many products cannot be substituted because they aren’t produced or available in the U.S.