Pandora is the world’s largest jewelry company, headquartered in Denmark, with nearly 500 stores in the United States, rather than any other major market. But in some ways, its real home is Thailand, where the company has made products for nearly four decades.
Like many global companies, Pandora uses a continental crossover supply chain to sell its goods globally at low cost. But last month, when President Trump said he would impose a 36% tariff on goods entering the U.S. from Thailand, and along with huge tariffs in dozens of other countries, the supply chain became a serious weakness.
Pandora’s stock is the worst performer in Europe after Mr. Trump announced his “reciprocity” tariffs. A week later, Mr. Trump delayed the tariffs until early July and offered a probation.
But threats are looming, and Pandora CEO Alexander Lacik does not expect an end to the uncertainty that paralyzes businesses. He said in an interview that unless the tariffs return to previous levels, the second year will be turbulent. For now, there is little to do, and there is only a wait for the reaction of investors, clients and competitors.
“With today’s information, I’ll be crazy about making major strategic decisions,” Rasik said.
Along with business leaders around the world, Mr. Lacik is struggling to deal with Mr. Trump’s unpredictable policies that have caused almost uncertainty. The Trump administration has begun to show a willingness to lower tariffs, but his first deal with Britain and China raises more questions than answers, and tariffs are still higher than a few months ago.
While some aspects of the trade war have been suspended, Pandora and other multinationals are in trouble waiting for more agreements to be completed.
Pandora is known for its silver charm bracelets and has been making jewelry in Thailand since 1989. In three factories, thousands of people have handmade these products. The company is building a fourth factory in Vietnam, but Mr. Trump threatens 46% tariffs on Vietnamese goods.
Last year, the company sold 113 million pieces of jewelry, about three items per second, making it the largest jewelry brand and offering stores in more than 100 countries. In the U.S., one-third of its sales, or 9.7 billion Danish Kroner, or 1.4 billion, Mr. Lacik said he had no intention of leaving the company’s most profitable market.
But the price will rise, and it is unclear who will bear the brunt of it, he said.
“The biggest question is, am I going to pass everything on to American consumers, or am I going to take the peanut butter out and raise the price of the entire Pandora worldwide?” Mr. Lackke said.
But Pandora kept stock for several months, giving him time to see how other jewelers changed their pricing and then decided.
Some things can be done immediately, such as simplifying the parts of the supply chain. The day after Pandora announced the reciprocity tariffs, it will change its distribution so that products sold in Canada and Latin America will no longer be carried out through the company’s distribution hub in Baltimore, a process that will take six to nine months to complete.
The transfer of output to the United States is not considered, in part because of higher labor costs. Pandora has hired nearly 15,000 craftsmen in Thailand and hopes to hire 7,000 in Vietnam.
In last week’s earnings report, the company estimated the cost of the trade war. If the fees for imports from Thailand, 36% and Chinese imports are higher, i.e., the import tax rate of 145%, then this year they will cost Pandora 500 million Danish Kroner 74 million US dollars (this year), then Danish Kroner 900 million US dollars, $135 million per year, and $135 million per year.
But the jewelers are not panicked. In fact, the economic curve is starting to feel normal, Mr Lacik said. He added: “We are ready.”
Pandora struggled when he joined the company as CEO in 2019. Its stock price has dropped more than 70% from its peak three years ago. Mr. Lacik had a “full overhaul” and designed with a new brand and store, highlighting his “affordable luxury” label and showing off his complete jewelry collection, not just glamour.
This prepares the company for the next experiment on the global economy. First, when 15,000 store employees were sent home, the Covid-19 pandemic, some factory workers slept on COTS to keep production. Then, the surge in inflation risk pulls customers back.
Mr. Lacik’s strategy seems to be working. In January, Pandora’s share price reached record highs. However, since then, it has dropped by more than 20%.
The company managed to avoid some trade turmoil on itself. After Mr. Trump raised tariffs on China in the first semester, Pandora stopped purchasing all showroom furniture and display materials for 3,000 stores from China.
Mr Lacik said: “We are ready.
