One of America’s most fragrant retailers is well-positioned in the face of tariffs.
Bath & Body Works produces 80% of its products in the United States. The candle maker and personal care company has been incrementally shifting its production to the U.S. for more than a decade/
“Domestic exposure puts Bath & Body Works at a key advantage versus the competitors, because they won’t have to pay import tariffs on the vast majority of their products, meaning they can keep prices where they are and not lose profitability,” said BofA Securities senior retail analyst Lorraine Hutchinson.
Bath & Body Works’ primary U.S. manufacturing facility, Beauty Park, is located in New Albany, Ohio, and opened in 2012.
“It was a choice made to make sure that they could test, react and move to the consumer very, very quickly,” said BMO Capital Markets managing director Simeon Siegel. “If you can find exactly what the customer is buying, you can minimize the discounts needed. It just happens to be right now… the tariff conversation creates them as this surprise winner there as well.”
Bath & Body Works says its foaming hand soap, for example, used to take about 3 months to reach its distribution center. The bottle and cap would ship from Canada, and the pump would ship from China. The soap bottle would be filled in Virginia and then sent to its distribution center in Ohio. Now, that entire process is done at Beauty Park — in 3 weeks.
The company has seen its net sales gradually decline since 2021 when it brought in nearly $7.9 billion as demand for hand sanitizers, candles and soap was high amid the pandemic. Bath & Body Works’ 2025 guidance represents the first time in several years that sales are projected to grow.
“There’s a notion that Bath & Body Works is just tracing trends. It’s just up and down and people have been dying for revenue growth, understandably. If instead we recognize that the revenue has been constrained because people bought too many candles during Covid, and now we’re finally emerging onto the other side, it should actually start trading hopefully better, a little bit more consistently,” said Siegel.
Watch the video to learn more about what analysts believe is in store for Bath & Body Works.
