Beer and liquor may be recession-proof, but they're certainly not tariff-proof.
Saturday, November 30, 2024 4:44PMrecession-proofIf President-elect Donald Trump follows through with proposals to impose a 25% tariff on all items from Canada and Mexico, the result would be a stiff penalty on some of America's favorite libations, not to mentionSome business owners have started stockpiling popular products - specifically tequila, which can be made only in Mexico - and taking other actions to help stave off potential price hikes.
"That's the whole point of negotiations like this is you need something to start the conversation or get the ball rolling," he said. "The hope is that it just comes down to not the worst-case scenario but something that everyone can be better walking away from. But, at the same time, you do need to prepare and start thinking about what to do should this become a reality."
For a business that trades heavily in tequila and serves up authentic dishes featuring distinctive ingredients from Mexico, a 25% tariff could be a significant burden. But Meximodo has arelatively large footprint at 7,000 square feet and is one of six restaurants operated under Le Malt Hospitality Group, which is taking steps to limit price hikes, TJ Pingitore, Le Malt's senior vice president for North America, told CNN.
The company is also implementing another precautionary strategy, one that's less technical: loading up. Its Meximodo Organic Blanco Tequila brand is set to launch in just weeks. From the Canadian side, the US imported $543 billion of alcohol last year, including $200 million of whiskey, according to the Distilled Spirits Council of the United States.
In 2023, Canada ranked as the second-largest export market and Mexico was the third-largest for American spirits, according to the Distilled Spirits Council.
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