Qurate Retail Group’s paying close attention to ocean vessel capacity and the East Coast port talks as it heads into the third quarter.

Qurate’s CEO David Rawlinson said the company’s continues to see some Red Sea disruptions. The U.S., with 15 percent of volume coming through the Red Sea, seeing little exposure and Europe, where 75 percent goes through the canal, seeing more of an impact.

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“It has caused some volatility in supply for our European businesses, but we’ve generally now built in more buying time and vendor order lead times to help counteract that,” Rawlinson said. Qurate is the operator of the HSN and QVC shopping and entertainment platforms, with operations in the U.S. and internationally.

More impactful over the second quarter has been the availability of vessel capacity coming in, which has “resulted in a shortage in the global ocean vessel capacity. That’s driving up rates, especially on the spot markets,” the CEO said. And while he said those rate increases were manageable in the second quarter, Qurate is “anticipating more volatility on deliveries and container prices as we go into Q3. So that, plus the potential labor negotiations with the east coast longshoremen are both things we’re paying a lot of attention to.”

Rawlinson said the company uses a combination of spot and term contracts to maintain freight rates. He also spoke about mitigating tariffs given election uncertainty in the U.S.

“We have, since the supply chain crisis, tried to create some diversity,” he said, adding that as for Qurate’s sources of supply, “less than half of our assortment ends up being impacted by tariffs and even that half the tariff rate is sort of mid-teens.”

Rawlinson emphasized that Qurate has a number avenues available for supply chain diversity. “So we don’t see a scenario either, no matter which way the election unfolds, that creates a level of difficulty around tariffs that are not manageable for us given where we are today,” he concluded.

As for the consumer, he said they remain very “choiceful“—a term he’s used before—in deciding what they are willing to spend on. “That’s not quite the same as the pocketbook being closed, but it does mean that you have to really excite. When a customer is excited, there’s not necessarily massive price sensitivity,” he explained, adding that sales have been softer for items where the customer has not been “extremely excited by the value.” Rawlinson also noted that Qurate has seen some trading down by customers, as well as a bit more value seeking on their part.