Small businesses brace for high tariffs imposed by president-elect Donald Trump proposed as one of his first actions when he took office.
Trump proposed that importers pay a 25% tax on all products entering the country from Canada and Mexico, as well as an additional 10% tariff on goods from China, as one of his first decrees. He had already proposed a price up to 20% on everything else imported by the United States.
This means small businesses could end up paying more for goods and services. Small business owners say they are waiting to see what final form the tariffs take, but are bracing for higher costs that they may in turn have to pass on to consumers.
Laurel Orley, co-founder and CEO of Daily Crunch, a Nashville-based sprouted nut snack company, said at first she didn’t think the tariffs would affect her business because it doesn’t import much. But she realized the tariffs would have a ripple effect. For example, she planned to source bags from China to save 5 cents per bag. But with customs tariffs, she may have to derail this project.
“That was one of our big initiatives for 2025, to ship all of our bags to China for 15 cents a bag,” she said. “And now I don’t know if we’ll be able to save money on bags when the tariffs go into effect.”
Warehouse prices are also increasing due to expected tariffs, Orley said. Its warehouse said demand had increased since the tariffs were announced.
“While many other businesses are purchasing inventory in bulk from overseas to anticipate tariffs, warehouse availability is becoming limited, which will increase costs for everyone,” she said.
So Orley is trying to secure its warehouse contract for 2025 and find a third-party logistics provider for the year, “to anticipate what’s going to happen and plan as much as possible,” she said.
Across the Canadian border, Julie Bednarski-Malik runs another snack company, Healthy Crunch, based in Mississauga, Ontario, specializing in foods free of the top 11 food allergens like peanuts, tree nuts and produce. dairy, as well as low sugar.
It sells its products in retail stores in Canada and the United States, and says the tariffs will affect consumers on both sides.
“If you have a severe anaphylactic reaction to some type of dairy or soy product and you can’t find a product in the United States because we’re the only ones making it, it’s going to cost American consumers a lot more.” Bednarski-Malik said. “So I think these tariffs are not only going to hurt, you know, other countries like Canada, but also American consumers.”
She is holding off on making major changes to her business until pricing is finalized, but expects to see higher prices.
“Ultimately, the consumer will have to pay in the end because our margins are so tight, starting with our food prices, (which) have increased dramatically over the last few years,” he said. -she declared. “So there is not much room left to keep the same price and maintain that price while being subject to additional 25% customs duties on our product.”