# 'I will have to raise prices by 10%' - toymakers warn of tariff pain

The business of the North American Toy Fair, an annual showcase of the latest in silly putty, monster trucks and board games, is fun. But this year at the convention center in New York City, tariffs were killing the vibe.

In February, US President Donald Trump raised tariffs on products made in China by 10%. Then last week, with little warning, he announced an additional 10% border tax, which has now come into force on Tuesday, along with tariffs on Mexico and Canada.

In the toy industry, which estimates that about 80% of toys sold in the US are made in China, the rapid-fire announcements have stunned businesses, leaving them scrambling to figure out how to swallow a sudden 20% rise in cost.

The moves are the first of what Trump has threatened will be far wider action, making it a preview of the upheaval that could be coming for companies around the world.

"It's the first thing we talk about and the last thing we talk about," toymaker Jay Foreman said this weekend from his booth at the trade show, where classic hits such as Lincoln Logs, Tonka Trucks and K'Nex were on display.

His business, Basic Fun!, makes 90% of its products in China and had been planning to counter the cost of the initial 10% tariff with a mix of higher prices for customers and lower profits, both for his firm and for his manufacturing partners.

He presented the strategy to his board on Wednesday, ahead of the toy show, only to have to rip it up the next day, after Trump's later announcement.

He will have to shoulder the tariff costs for products headed to stores this spring, he said, but is now expecting to raise prices for many items by at least 10% later in the year.

"The reality is that tariffs will raise the cost of toys for consumers," he said. "If a customer says, 'Then I can't buy it', then I can't sell it, because I can't produce to lose money."

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