'This week, there are multibillion-dollar commercial deals with Amazon. Oracle. AMD, they're all here. Uber. Quail com,. Johnson and Johnson and many, many more.

'A lot of President Donald Trump's first big foreign trip to the Middle East was about deals and agreements. Deals between tech companies and Saudi Arabia. Defense deals between the US and Qatar, which also put in a massive order for Boeing planes. Trump announced a plan to issue sanctions waivers for Syria and its new regime, a potentially huge move for the region. But before he even left on Monday, Trump came out and declared victory in his self-inflicted trade war with China. Lease for now.

Both the US and China are now rolling back tariffs on each other's goods. And the U.S. Will now impose a 30% tariff on Chinese goods down from 145 percent. China has agreed to roll back their rates on U.S. Products to 10 percent, down from 125 percent.

'That 90-day walk back followed an agreement with the United Kingdom. But just how much of a breakthrough is this? Because as I record this, all of the tariffs on China and the UK... Plus all of the retaliatory tariffs they have slapped on us. Are higher than they were when Trump came into office. All of them. And despite rolling back the near-universal tariffs Trump announced back in April, Some of America's biggest retailers are warning that prices will still need to go up. So businesses supplying these products are left with many questions. Do they raise prices? Do they stockpile inventory? Do you even acknowledge the word tariff? Today, I talked to one business owner about his answers. From CNN. This is one thing. I'm David Rind.

I was away this weekend at a family event and also got to spend some time with friends down in Washington, D.C. And It's unbelievable. The only thing people wanna talk to me about is tariffs. And it's all I'm thinking about during the workday. It's the last thing I wanna be thinking about. When I'm with friends and family. But I can tell it's on everybody's mind and right now someone who operates in the space. People are looking to me for my take and sometimes I just want to run away from it, but it seems like I can't escape it.

'This is Michael Weider. He's the co-founder of Lalo. They make products for babies and toddlers. Think high chairs, cute wooden toys, bathtubs. You get the idea.

We make products all over the world, but predominantly in China, where there's been a supply chain making. The products that we make.

Their products are available online, but they also recently started selling at select target stores across the country. And so when Trump slapped a 145% tariff on Chinese goods. Michael, like countless other small business owners who rely on China for their products. I had to figure out what to do. And fast. So, earlier this month, I asked him to send me some voice notes as he navigated this process in real time. He sent us the first on May 5th.

We just got off what we call our tariff task force call. We do this twice a week. Once at night on Mondays where we talk also with our employees over in Asia, and then we also do it on Fridays during the day in the States. So we can talk about hot topics, talk about anything that's changed. And tonight was definitely an interesting call. We... Had to make some tough decisions about what to do with our supply chain and we're exploring moving some stuff from China over to Vietnam and some over to Thailand and we are lucky that we have some partners in Vietnam that we already work with but we are having to make the hard decision of do we let a Chinese supplier know that we are about to ask to our tools. For some of our most important products to a different supplier in Vietnam.

A lot of these. Companies already have factories and what they have to do is just fill them out. But they're able to build them in the United States. So we gave them.

In addition to looking at some other foreign countries for manufacturing, we've also been doing some and quoting exercises. With factories in the United States to see what we can bring back on shore. First of all, it's taking... THREE TIMES AS LONG to quote as. Other places and the types of questions that we get from U.S. Manufacturers. They don't get they don't have the same understanding and same level of support that we're getting from foreign partners, which is really interesting. It even makes me wonder kind of like if we were to have to bring things to the US, what types of other talent would we need on our team? Internally that we currently get from our partners in China and overseas, which is just been a really interesting learning because we've certainly been digging into domestic manufacturing to understand. Is it even possible? And so far... The answer has been no in our space. Right now, we're finding our best options are still overseas.

New this morning, higher prices coming soon for Barbie. Mattel is warning it will need to raise prices on American toys because of the president's tariffs. President Trump has suggested a sort of dull austerity plan.

I don't think a beautiful baby girl needs, that's 11 years old, needs to have. $30, I think they can have $3 or $4.

Today we decided to launch. An email. Series for our customers called Tariff Tuesdays, and yes, we understand the absurdity of branding something around tariffs, but to be honest, it feels like sometimes we just need a good laugh right now. Basically, this is an email that's going to come out every Tuesday to our customers to give them some clarity around the situation with tariffs, understanding how it impacts parents very specifically, but we're gonna continue to do it and we're actually going to host a completely public AMA for all of our customers or any parents. Any question on the spot? I'm going to answer live on a Zoom and it's open to anybody. So, I'll report back. I'm very curious to hear what our customers are thinking about because You know, I do think... At the very best people feel the uncertainty and at the worst people feel this is extremely And parents are concerned.

So breaking just a short time ago on social media. President Trump signaled a major concession in his tariff policy toward China. This is what he wrote. 80% tariff on China seems right. Up to Scott B. Scott B is the treasurer, treasuring Scott Besant. The current tariff is 145 percent. So he's floating a 65% reduction in tariffs to China even before U.S. Negotiators sit down with Chinese officials, Scott Bessen among them. This weekend in Switzerland.

So Besson is headed over to. His talks with China. And of course, the president comes out today on true social and posts 80%, that's what the tariff should be in China. But up to Besson, and. That's not the outcome any of us are hoping for, but. If that's going to be the number and they're going to come to terms and state that and put an end to the ambiguity and the uncertainty. That's better. The hardest part is the freeze. That everybody's in. People are frozen and. At least the talks are going on. Let's see what comes out the other side.

All right, breaking news this morning, tariffs be gone. Most of them. As Politico put it this morning. War is over. The U.S. And China announced a surprise pullback on sweeping tariffs over the weekend. After meetings in Switzerland. This is a huge reversal for the Trump administration.

I've never woken up to more WeChat messages in my life. This is great news, at least for the short term, that we have clarity on what it means to get our goods out of China to keep shelf stock. Also good news is that this is right in line with the main scenario. That we've been using for financial planning, inventory planning. And so this 90 day pause is huge. We expect freight to skyrocket now as people turn production back on. And get everything that's sitting at their warehouse. We have hundreds of thousands of units just sitting, waiting to ship. So those we'll all get on boats. End. You know, we're still planning for the long term, but this is a great step in the right direction.

'If a longer-term deal is not reached with China at the end of these 90 days, can the American people expect those tariffs to go back up to 145%?

No, but they would go up substantially higher.

We'll be right back.

Hey there Michael, good to talk to you.

Good to see you.

So, the last note you sent... Us was right after Trump. Announced it had come to an understanding with China and lowering these tariffs for 90 days. That was on Monday. We're talking on Thursday. How has the week been going?

'Yeah, I mean, it's been. It's been a pretty interesting week. I feel like every. I wake up now in kind of a panic of like what's happened overnight. I think for us where we've kind of met internally. It's really about staying the course and kind of. Building our supply chain resiliency for the long term. These have to be long-term decisions. And so... That short-term sigh of relief on the 30%, we're back to kind of operating as if it's going to be a long-term, but with kind of the knowledge that we can make some pivots and short-terms decisions if it goes awry. And so we're booking every container we can get to get goods on the water. We're placing. You know, additional orders to try to get things in during that period. You know, one of the biggest concerns right now is that It's not 100% clear what happens if you put stuff on the water and it doesn't get here in 90 days.

So you're worried that you could put something... On the ship. That in theory... Is not subject to the sky high tariffs it could get on the water and by the time it arrives the tariffs could be bumped up.

'Yeah. Yeah. I mean, previous actions have had a little bit more clarity on that. This action does not. And so. Right now, there's a period of time where some of our best selling products may be out of stock for a couple of weeks. And If we didn't get this 90 day pause that couple of weeks could have been a couple of months. And so I do have lost revenue, for sure. There's also The rest of the reciprocal tariffs that are coming due in July. The initial 90-day pause is coming due sooner. So we make products also in Taiwan and Vietnam and Thailand and Turkey today. So we're still waiting with that uncertainty too.

So when is the moment that you have to tell yourself, we have to raise our prices.

Yeah, it's probably coming soon. Um, how soon? It's probably. Some point late June, early July. Would be the soonest that it has to happen. We have some stuff coming now that's gonna be. Sellable inventory at that point that was hit by the tariffs. And so we've been communicating with our customers and at least give them the most transparency that they're getting from any company, because I think. Parents especially deserve it. There's enough anxieties that they have. You're someone that's having. A child. Doesn't need to worry about. Is my height going to cost more money tomorrow? I'm going to give a couple minutes for people to file in and we'll then jump right to it.

Tell me about this webinar you hosted with... Your customers the other day, you're talking about that transparency you want to have with them. What stood out from those conversations?

You know, the thing that stood out the most? Was at the end of the webinar.

You know, that kind of covers kind of covers what I'm hearing. It looks like two more people shouting questions.

And it felt really good. It was like actually kind of emotional because. People were asking how they could help us. At the same time I was trying to help them.

Are there things we can do as customers to support the work? Lalo and other baby goods companies are doing to address the issue on tariffs?

And so that was a testament to what we've built as a brand that... This we're in it together feeling and that's what we set out to build with Lalo. I think the other pieces that were interesting is that there's definitely a lack of education. Into what these tariffs mean.

What 145% meant is if I made a product for $10, it was gonna cost me an additional. $14.50 to the U.S. Government. From my pocket. My company's pocket to bring that product in instead of 10. Now at 30. I only have to pay an additional three.

I think one of the biggest things people don't understand is that most Brands, most companies don't own their own factories. Like contract manufacturing dominates most of what you see on the shelves.

And you mentioned that you looked into the possibility of maybe moving things more stateside. As a result of the tariffs, but that the number is really. Weren't adding up when it comes to the expertise you talk about or just the financials of doing it elsewhere. Did that surprise you?

'Um... My expectation was that it was not going to be possible, but I left some hope that- That would be great. You know, made in America, that is a dream. Like if you can make this stuff here. And. You know, keep all the dollars at home, that's great. But the price on the unit level is a little bit more expensive on some simple stuff. You can't do any assembly here. The tooling for this stuff is double, triple, quadruple the cost of what it is in China.

Does that bother you, that that's the state of play, or is that just kind of how things have been and that's how most businesses deal with it?

No, I think... Different products, different industries. There's different rationale for making products in different places and you have to look at the sum of everything. There also has to be, in terms of the supply chain. Kind of a looking in the mirror moment. What industry do we truly want to have here from a manufacturing standpoint and what doesn't belong? You don't have to stand for everything. It's okay to have an advantage in making. Cars. It's okay to have an advantage in making chips or high value tech components. The stuff that we make. I don't believe is of any sort of national interest in terms of creating comparative advantage globally. It's okay to have a global trade. And admit that this is better off being made here and not here.

Like the U.S. Doesn't need to lead the world on high chairs or... Baby baths.

No, no, you're like. You don't need to catch up. The amount of time it would take to catch is not worth it and there's not the amount of talent, the amount of people that want to work in that sector.

I wanna ask about the retail side of this. You guys are in Target and just this morning as we're talking, Walmart made some big news by announcing that because of the tariffs. It is going to have to raise prices later this month. Do you think? A similar announcement could be coming from Target in the days or weeks ahead.

Yeah, I mean, every business, you know, all these companies, you know, make a ton of products themselves, that brands are have been evaluating that I'm sure tons of brands have submitted for price increases. And, you know, for us, before we even are thinking about us and our retail partners, we're thinking about our customer, what are they going to need to pay? Where does that fit into their? How many decisions and, you know. How much they purchased in the first year, you know, parents are spending. Thousands of dollars in the first year alone on their child. So we don't want parents making sacrifices on safety either. I've seen some crazy stuff out there about... Do I even need a car seat anymore? Wow, really? We don't want people saying that.

No, I mean, that's wild. Well, so you said you obviously want an exemption for baby products, but beyond that... Like in your perfect world. How does this? And in a way. That. Would. Make you happy.

There's definitely different perspectives on the purpose of tariffs and why they exist. And... I'm not saying this is my perspective by any means. But I think that. You know, a baseline global tariff. There is a defensible economic reason for that in regenerating certain revenue. Now, I hope that revenue would go into creating great things like better health care. And helping parents. That being said, we live in a global society now. Right. The barriers are completely broken down more than they've ever been because of where where technology has gotten to. And. Yeah, my hope is that. Whatever the administration decides. That is a decision that goes well beyond 90 days. And so at the very least, we could expect for the next three and a half years. This is going to be. What it's going to be because then we can as business owners we can all operate again the impact of tariffs. Don't happen immediately, they happen over time and even some of the impacts of. You know, the low inflation that's being reported right now is because the impact of the tariffs hasn't hit yet. It's hit the business, it's potentially hit the businesses, but not the consumer.

Well, Michael, always good to chat with you. Thanks so much.

Yeah, of course. Nice to chat to you.

One Thing is a production of CNN Audio. This episode was produced by Paola Ortiz and me, David Rind. Our senior producers are Matt Martinez, Felicia Patinkin, and Faiz Jamil. Matt Dempsey is our production manager, Dan Dzula is our technical director, and Steve Lickteig is the executive producer of CNN Audio. Get support from Haley Thomas, Alex Manasseri, Mark Duffy, Robert Mathers. John Dianora, Leni Steinhardt, Jamus Andrest, Nichole Pessarru, and Lisa Namerow. Special thanks to Wendy Brundage. We'll be back on Wednesday. I'll talk to you then.