👉 Background: Last Thursday, the US administration placed tariffs on more than 90 countries around the world, including Australia and the UK. While some countries were hit with 'baseline' tariffs of 10%, other countries were hit with much bigger tariffs, like Vietnam which was hit with a 46% tariff.

‍👉 What happened: Now, Nike has seen its share price tumble 6% after the tariff announcement because it produces 50% of its shoes and 28% of its apparel in - you guessed it - Vietnam. And given this monstrous tariff, Nike needs to find a way to bring its goods into the US… at a reasonable price.

‍👉What else: This continues from Nike’s rocky March as well, which saw its share price dip more than 20%. It goes to show, you just gotta spread the love with your manufacturing.

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‍What's the key learning?

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‍💡When companies rely heavily on one country for production, any disruption can trigger big financial consequences. It might be tariffs or political tension or even risks of natural disasters.

💡The irony is that Nike moved a lot of its production to Vietnam during Trump’s first presidency — when trade tensions with China were heating up. At the time, it was seen as a smart hedge against relying too much on China. But, sometimes even friendly trade partners like Vietnam, can find themselves on the receiving end of economic pressure.

💡Ultimately, companies can diversify their supply chain to reduce their risk — like spreading production across multiple countries or region. But Nike is hoping that after Trump's recent 'productive' call with Vietnam's leaders, it may delay the tariff from its planned April 9th deadline.