Most businesses in the New York region are raising prices to offset higher costs from tariffs, according to a report from the Federal Reserve Bank of New York. Nearly a third of manufacturers and 45% of service firms reported passing on the full increase to customers. The survey, conducted in early May, revealed widespread confusion among firms about tariff levels and future policy, making it difficult to plan and set prices. While many businesses raised prices on both tariffed and non-tariffed goods, the report noted that some cost increases were softened by switching suppliers or foreign producers lowering their prices.

On the latest episode of the MDM Podcast, LGG Industrial CEO Jeff Crane discusses the motivations and processes behind the 90-year-old company's early 2024 rebrand from ERIKS North America. In a wide-ranging discussion with MDM Executive Editor Mike Hockett, Crane also details recent branch and technology upgrades, and how the firm is approaching and implementing AI. Crane and Hocket also discuss LGG's tariff strategies, touching on one of the biggest concerns for the distribution sector in 2025.

America's trade deficit shrank by a record amount in April, dropping around 55% to $61.6 billion from $140 billion the previous month, per Bureau of Economic Analysis data. Imports were down by 16% as tariffs came into effect, and exports increased by 3%.

Optimas Solutions has established a daily "tariff war room" to address the complexities of shifting tariffs, CEO Daniel Harms says. The company is focused on communication and risk management to ensure production continuity, Harms says, noting that actions include sourcing shifts and increasing domestic manufacturing.

Retailers in the US are adopting different strategies to cope with tariffs, with some increasing prices and others absorbing the costs, says Mark Mathews, NRF's executive director of research. He notes that consumer sentiment is low despite strong disposable income, leading to unpredictable spending patterns, and that retailers focused on offering the best value are better positioned to succeed in the current environment.

Aligning sales and marketing is crucial for B2B companies to provide a seamless customer experience, writes Shannon Majumdar. Disconnected efforts between these teams can lead to a "jarring disconnect" for customers, Majumdar writes, adding that success requires ongoing communication and shared metrics to ensure a unified approach.

The National Association of Wholesaler-Distributors asked the Oregon Department of Environmental Quality to delay implementation of the state's Plastic Pollution and Recycling Modernization Act by one year, citing confusion among businesses and unanswered questions. "Moving forward with enforcement while key questions remain unanswered is irresponsible," said NAW Chief Government Relations Officer Brian Wild, adding the law would have far-reaching consequences for distributors. "Oregon should delay implementation to give regulators time to provide the clarity needed to comply without jeopardizing jobs or business operations."

The Federal Reserve's latest Beige Book indicates a slight decline in US economic activity, citing tariffs and policy uncertainty as major factors. Prices have risen moderately, with expectations of further increases as businesses plan to pass on tariff-related costs. Employment remains flat, and the overall outlook is slightly pessimistic.

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