In a recent webinar, Dane Cohen, Director of Retail Strategy at Management One, sat down with retail industry expert and Management One co-founder Marc Weiss to discuss real-world tactics for navigating tariff-driven cost increases.
From pricing moves to vendor negotiations and sales-boosting ideas, here are the three strategies for independent retailers to turn economic pressure into opportunity — using data, focus, and adaptability.
“There’s nothing like having these disruptors in history to realize that there’s always a win if you look for opportunities of success, rather than focus on the losses.” – Marc Weiss
Strategy #1 : New Pricing strategies That Protect Your Margins
When faced with rising costs, a retailer’s instinct is to absorb them — cutting margins to avoid passing prices on to customers. But that’s unsustainable.
For instance, price increases during Covid ranged from 23% to 30% at the retail level — and up to 60% in luxury — yet customers kept shopping. The key is not to underestimate your customer’s willingness to pay, especially when they see real value.
Here are actionable tips that you can implement to protect your margins :
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Maintain strong initial markups (IMU%) to offset cost increases. If your COGS go up 10%, your IMU needs to follow.
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Evaluate price elasticity: keep pricing firm on inelastic or exclusive items, adjust where volume is more sensitive.
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Use pricing strategies like bundling, tiered pricing, or value-added offers to protect margins.
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Implement gradual increases to avoid price shock.
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Focus messaging on value over price: emphasize quality, service, exclusivity.
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Use loyalty programs and psychological pricing to cushion increases.
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Have a strong class structure so you know where price changes make sense—and where they don’t.
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Ensure your team understands the “why” behind your pricing.
“The buyer’s job is to make sure that the people in the store are educated and understand why the buy was made and why it’s important, so that they have the words and music to sell it well.” – Marc Weiss
