Australia-based Yowie Group is actively re-evaluating its supply chain due to the imminent US tariffs on imports from Canada and China.
The tariffs, effective from February 4, include a 25% levy on Canadian imports and a 10% levy on Chinese shipments to the US. These changes could have significant implications for companies reliant on international trade.
Yowie sources essential ingredients, like chocolate and packaging, from Canada and imports toys from China for its US production facility.
The company projects an annual cost increase of $0.8 million resulting from these tariffs if it does not adapt its supply chain. To mitigate this financial strain, Yowie plans to source chocolate from the US, which will potentially address 65% of the projected tariff burden.
Additionally, Yowie is undertaking a comprehensive supply chain review to minimize the adverse effects of these tariffs on its operations.
Yowie’s branded products are marketed in both Australia and the US, with a mission to promote learning, understanding, and engagement with the natural world.
It’s worth noting that Yowie depends on external partners for its production and distribution.
In May, Keybridge Capital acquired loss-making Yowie and appointed Nicholas Bolton as CEO. At that time, Bolton stated: “Following Keybridge’s successful takeover, my initial focus as CEO is to aggressively rationalise the cost structure of the business while promoting innovative products at sustainable margins.”
For the fiscal year ending June 30, 2024, Yowie reported a loss of $2.64 million—significantly up from a loss of $0.1 million the prior year. These losses were primarily associated with seasonal sales fluctuations in Australia and operational challenges at the Ernest Hillier facility that Yowie acquired in 2023.
