This also deposited test is based on a conversation with Catalina Mendoza, a 26-year co-founder of a luxury tote bag based in Germany. The finance of the company was verified by Business Insider. The following has been modified for duration and clarity.
I creak my teeth when I saw people crying on social networks. I never wanted to be one of them.
But in April, my husband received a call with our suppliers in China and told me that we had to stop selling in the United States immediately. American import prices Since China had jumped at 145%.
We started to hear about prices earlier in the year, but we were taken in the decision -making process and did not act quickly enough.
Once in force, I knew that we had to inform our customers, so I made a Tiktok video – and I cried there. It was not wrong. All this experience was overwhelming and, honestly, frightening.
We had no prior business experience
My husband and I launched the tote library, a luxury tote bag company in 2022. I was still an art student at the time, and although my husband studied marketing, none of us had a lot of professional experience.
The idea was to transform my creations into something functional and cute.
Catalina Mendoza was a student in art when she decided to set up the tote library. With the kind permission of Catalina Mendoza
I made the first prototype, and we found a supplier in China on Taobao, a local online purchase platform, which could produce it. My husband used Google Translate to communicate with them. We launched with around five bags per design and started to market them on social networks.
I started publishing online videos using trendy audio. Finally, a video gained ground. It was not a viral sensation, but it has tens of thousands of views. We sold immediately.
Social media looked like the key to electronic commerce. I continued to publish and cultivated my account. Even if we were based in Europe, our largest traction came from the United States. The American market represented almost 50% of our total sales.
Last year, we wanted to evolve. We dreamed of extending beyond the tote bags, throwing other luxury items and even household items. We also focused on the growth of our activities in the United States. Our ambition was to open a warehouse there so that we can send our American customers more quickly.
Over the next six months, we have invested massively in the American market, mainly through paid announcements on Meta and other social media.
We spent more than $ 32,000 on our campaign based in the United States. We also offered more than 1,000 bags to creators in the United States, covering production and international shipping costs. It was a high cost risk, but it was worth it to be taken.
It was until the entry into force of the prices in April.
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Investing in American sales looked like a risk to take, then the prices struck
Almost overnight, our American sales fell to zero because we had to remove the country from our Shopify store.
Our luxury items are already at the upper end of the tote bag market, and the increase in prices to cover the increase in prices was not an option.
It was terrifying. We had worked so hard, and just as we were ready to grow, I felt like I was torn off in an instant.
In May, a 90 -day grace period has temporarily reduced prices. We decided to reopen sales in the United States, but the quarter of work probably confused our customers. We do not know what is happening after the end of the period of grace. It’s so unpredictable, and I already have the impression that our reputation in the United States took a hit.
While American sales are from top to bottom, the Tiktok video of me crying has become viral, increasing the notoriety of the brand in Europe.
Our main objective is now on European consumers. We plan to start producing locally and to market more than people in Europe love. I even plan a change in the brand of European tastes.
I seek to move production, potentially in Portugal. Production in Portugal will probably make the bags more expensive, but I learned that having supply chains closer to you means that you have more control.
It was a major setback for our company
I try to remain positive about the future, but I have the impression that we start from scratch.
The company is our only source of income. We examine if we need secondary work to provide some stability. I also have two people who work with us on social networks and marketing, and suddenly, I fear to do enough to cover the pay.
The Tote Library is the only source of income for Catalina Mendoza and her husband, Patrik Walk. With the kind permission of Catalina Mendoza
We got used to a certain lifestyle, but we will undoubtedly need to reduce. I am from Chile and so far, I have been able to visit the house at least once a year. With all this instability, I am not sure I can justify spending money on plane tickets or vacation.
Emotionally, it looks like a step back. Some days, it is difficult to present yourself as the company’s face when I don’t feel best.
I’m just trying to remember that this is not the end of the world. If I learned one thing from this experience, it is because I cannot count on the United States or on a single market, especially in the current political climate.