Rocky Brands is actively implementing a multi-pronged strategy to mitigate the impact of additional U.S. government tariffs on imported products, particularly from China. The company is accelerating the shift of production to its owned facilities in the Dominican Republic and Puerto Rico, alongside diversifying sourcing to countries like Vietnam, Cambodia, and India.
An accelerated inventory build in the first half of 2025 has provided Rocky Brands with a 6-7 month buffer. This strategic inventory position allows the company crucial time for these sourcing transitions to fully materialize, with the largest margin benefits from these shifts anticipated in 2026.
Management aims to reduce China-sourced volume to less than 20% by the end of 2025, a significant reduction from approximately 50% in 2024. This proactive approach is designed to maintain competitive pricing and ensure product availability, directly countering supply chain rigidities faced by competitors.
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