### Steve Madden to Reduce Chinese Imports by Nearly Half Amid Tariff Concerns

Steve Madden is set to significantly cut down its imports from China over the next year, preparing for potential tariffs expected under President-elect Donald Trump. CEO Edward Rosenfeld announced the company’s strategic move to decrease its reliance on Chinese manufacturing during an earnings call on Thursday.

The shoe brand, which currently sources over 70% of its U.S. imports from China, aims to reduce this by 40% to 45%. This reduction plan has been in preparation for a scenario where goods need to be relocated quickly out of China. In anticipation, Steve Madden has already been scouting for manufacturing alternatives in countries like Cambodia, Vietnam, Mexico, and Brazil.

"Starting from yesterday morning, we have initiated this plan," Rosenfeld stated. "We anticipate that the portion of goods sourced from China will start to decline more rapidly."

Presently, Chinese imports account for just over two-thirds of Steve Madden's business. Yet, with the new strategy, the company expects that only about a quarter of its operations will be affected by potential tariffs on Chinese goods in a year’s time. This move comes as Trump has promised to impose tariffs ranging from 10% to 100% on imports, particularly targeting China.

The industry as a whole has been making similar efforts to diversify sourcing due to various challenges including labor shortages in China, supply chain disruptions from the COVID-19 pandemic, and the Red Sea shipping crisis. Retail analysts caution that these tariffs could lead to increased prices for U.S. consumers and potentially dampen spending.

Other companies, such as E.l.f. Beauty and Tapestry – the parent company of Coach and Kate Spade – have also taken steps to mitigate the impact of potential tariffs. In particular, E.l.f. Beauty has raised prices on some items and moved more production out of China since the initial tariffs were imposed during Trump's first term. Meanwhile, Tapestry has managed to keep its Chinese sourcing to less than 10% of its overall supply, with CFO Scott Roe noting that the company is adept at navigating through such disruptions.

As retailers continue to adapt, the business landscape remains volatile with Trump's trade policies likely to influence many more strategic decisions in the coming year.