What Franklin Electric Co., Inc. told the SEC could break it.

Franklin Electric's pumps and motors rely on metals — copper, steel and aluminum, among others — whose price volatility flows through the purchased component parts it buys, so metal-price spikes raise its costs to the extent it cannot pass them through.

“Portions of the Company's business are exposed to volatility in the prices of certain commodities, such as copper, steel and aluminum, among others. The primary exposure to this volatility resides with the use of these materials in purchased component parts.”

U.S. tariffs on imported steel and aluminum, multiple tariffs on China imports, tariffs on Canada/Mexico and baseline tariffs on most other imports have increased Franklin Electric's raw-material and component costs; tariff costs contributed to a ~110 bps decline in its 2025 operating-income margin, with further trade-policy changes a continuing risk.

“The U.S. government recently implemented significant trade policy and tariff actions, including but not limited to tariffs on imported steel and aluminum products, multiple tariffs on certain imports from China, tariffs on certain imports from Canada and Mexico, and baseline tariffs on most imports from most other countries. These actions have increased the cost of certain raw materials and components.”

Franklin Electric is dependent on a single or a limited number of suppliers for certain materials and components used to manufacture its pumps, motors and fueling systems; if a key supplier fails on delivery or quality, it could face supply shortages and be unable to meet customer demand, despite believing alternatives exist for the majority of its inputs.

“The Company is dependent on a single or limited number of suppliers for some materials or components required in the manufacture of its products. If any of those suppliers fail to meet their commitments to the Company in terms of delivery or quality, the Company may experience supply shortages.”