German footwear brand Birkenstock anticipates a significant impact from US import duties, prompting targeted price adjustments and supply chain efficiencies to preserve margins amidst ongoing trade tensions.
Birkenstock has acknowledged that U.S. import duties introduced under the Trump administration are beginning to squeeze its margins and that targeted price rises for some products are planned for 2026, the company said this month.
According to The Independent...
Continue Reading This Article
Enjoy this article as well as all of our content, including reports, news, tips and more.
By registering or signing into your SRM Today account, you agree to SRM Today's Terms of Use and consent to the processing of your personal information as described in our Privacy Policy.
, chief financial officer Ivica Krolo outlined the scale of the challenge, noting that a 10% tariff effectively raises the landed cost of every $100 of product entering the U.S. and forces the business to find additional revenue or savings to preserve profitability. “The price increase would have to be 2.5x the tariffs,” Krolo said, adding that the company was reluctant to pursue a uniform, steep hike because it would conflict with the brand’s values.
The company is instead taking a mixed approach. Krolo told reporters Birkenstock will apply selective, seasonal and style-by-style price adjustments rather than a single broad increase, while simultaneously seeking cost reductions across its supply chain. According to CNBC, Krolo framed planned global price moves as part of an effort to “fully offset the effects from current existing tariffs” and said the business will also press on with efficiency gains in production and logistics.
Company filings and market commentary indicate the tariff effect is already being modelled into forecasts. Investing.com reports Birkenstock expects U.S. duties to subtract around 100 basis points from annual gross margins in fiscal 2026 and warned the hit to cost of goods sold will be larger next year than it was in 2025. Retail Dive and SupplyChainDive say the firm plans to push further on supplier negotiations, manufacturing efficiencies and shipping optimisation to reduce exposure.
Despite the headwinds, Birkenstock has continued to expand its retail footprint and customer engagement. The company opened 30 stores in 2025 and intends to add roughly 40 more this year, Krolo said, while outlining plans to grow loyalty initiatives. “We are working to drive an even stronger connection to our consumers through more targeted membership benefits, a loyalty program, exclusive styles, content and special events,” he said.
Management also benefited from tactical shipping decisions in 2025, moving as much inventory as possible from Europe into the U.S. before levies increased and implementing modest global price rises in mid-2025. Those increases were generally single-digit and left flagship items such as the Boston clog only marginally higher than earlier in the year.
The broader political backdrop remains fluid. The company had braced for further levy increases due to take effect on February 1, 2026, but the immediate prospect of additional duties was eased after President Donald Trump signalled a pause at the World Economic Forum in Davos, a development that could temper near-term cost pressure on U.S. retail operations.
Analysts warn that higher retail prices alone are unlikely to eliminate the margin hit, leaving Birkenstock to balance measured consumer price moves with operational savings and geographic diversification. Industry observers note the brand’s growing Asia-Pacific business offers partial insulation from U.S.-dollar movements and American tariffs, but they underscore that material mitigation will depend on how long levies remain in place and whether further policy shifts occur.
Source: Noah Wire Services
