US consumer goods company Procter & Gamble PG.N will again look to raise prices for its household essentials such as Tide detergent if President Donald Trump imposes new tariffs that make imports more expensive, an executive said on Wednesday.
“Whatever management decides to do, we’ll be able to handle it,” Andre Scholten, Procter & Gamble’s chief financial officer, said on a call with reporters following the quarterly earnings announcement. He added that the company will first try to offset potential tariffs by reducing costs.
“And what we cannot compensate for with productivity may lead to additional prices,” Schulten added.
Procter & Gamble’s sales volumes rose in the quarter ended Dec. 31, while the company kept prices steady across its global portfolio of dish soap, laundry detergent and toilet paper.
The company, seen by investors as a major player in the consumer products industry, buys inputs such as chemicals, razors and small electronics from around the world and manufactures the final product near consumers in local factories.
Procter & Gamble has raised prices repeatedly over the past several years as it faces rising costs on fuel and labor. Trump’s round of proposed new tariffs — which could target Mexico and Canada first — could increase these costs.
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“I think it’s still a risk,” said Michael Ashley Shulman, chief investment officer at Procter & Gamble investor Running Point Capital. “It’s a little difficult to say how much of this tariff they can pass on to consumers.”
Over the past four years, the company has overhauled its razor supply chain for its Gillette brand, a move that could cushion its margins under the new tariffs. Procter & Gamble rival Edgewell also told Reuters earlier this year that it was looking to secure Chinese chemical supplies for sunscreens ahead of potential tariffs.
P&G also has “formulation flexibility,” Scholten said, meaning it can adjust ingredients in its products if they become too expensive or unavailable due to tariffs.
Scholten added that Procter & Gamble, which is facing a supply chain crisis after the Covid-19 pandemic, has invested $6 billion in American manufacturing in the past six years.
(Reporting by Jessica DiNapoli in New York; Editing by Nia Williams)
