There’s no denying that U.S. tariffs will affect the importation of various goods crucial to the smart home technology sector. Tariff decisions have the potential to strain smart home professionals who specialize in custom installations and integrations of advanced technologies, such as home automation systems, audiovisual equipment, security features, and energy management solutions. Additionally, professionals could face significant operational challenges as they attempt to absorb increased material costs or pass these expenses on to consumers.
Fortunately, CEDIA remains committed to equipping its members with the resources, advocacy, and education necessary to thrive in these challenging times. CEDIA’s CEO, Daryl Friedman, recently conversed with professionals in the field, Rob Mangas and Laura Siegel Rabinowitz, who identified the three key actions smart home professionals can take in order to stay ahead of the challenges tariffs will present.
1. Analyze your supply chain to identify any products or components that may be impacted by
new tariffs
“Supply and demand govern you,” says Rob Mangas, Government and policy lawyer. “It’s reasonable to expect some kind of price increase, but we can definitely expect demand to go up significantly, and therefore, U.S. production should go up significantly. Hopefully, the capacity is there in a manner that doesn’t really result in significant price increases, but it’s something everyone’s going to be closely monitoring,”
2. Review existing purchase agreements and production contracts to understand how tariff costs will be allocated.
“You need to know where your products are coming from, that you have purchase agreements for what country they’re coming from, and potentially the source of the components of those finished products. It’s important to do a risk analysis,” advises Laura Siegel Rabinowitz, an International trade lawyer.
3. Consider adding language to new agreements to protect against tariff-related price changes.
“This is the time to revisit agreements that may have been signed before the new presidency started,” says Mangas. “Check if there are actually provisions that cover who bears the tariff responsibility and what happens if it changes after the production date, and then, certainly for new agreements, it’s important to add language to protect you know, whoever you are in the supply chain.”
“If you are a purchaser from the importer, you want to protect yourself, knowing that the price that was calculated when the production agreement is negotiated may not be the actual price of the product at the date of entry, because duties are due and tariffs are determined at the date of entry, so it’s not a date of production agreement. So that’s why you have to really look at your production agreements carefully and edit them, if you can, to protect yourself for a date of entry,” concluded Mangas.
For more information about CEDIA and how the recent tariffs may impact the smart home technology sector, please visit www.cedia.org.
About CEDIA
CEDIA is an international trade association dedicated to the residential and commercial custom electronics industry. Founded in 1989, CEDIA provides education, certification, advocacy, and networking opportunities for professionals in the smart home technology sector. The association’s mission is to enhance the professional image of its members and promote the benefits of smart technology in homes and businesses around the world.
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