Small businesses are bracing for tough tariffs that President-elect Donald Trump has proposed as one of his first actions upon taking office.
Trump has proposed that importers pay a 25% tax on all products entering the country from Canada and Mexico, and an additional 10% tariff on goods from China, as one of his first executive orders. He previously imposed a tariff of up to 20% on everything else the United States imported.
This means that small businesses can ultimately pay more for goods and services. Small business owners say they are waiting for the final shape of the tariffs, but are bracing for higher costs that they in turn may have to pass on to consumers.
Laurel Orley, co-founder and CEO of Nashville-based sprouted nut snack company Daily Crunch, said initially she didn’t think the tariffs would affect her business because she doesn’t import much. But she realized the tariffs will have a ripple effect. For example, she planned to buy bags from China to save 5 cents per bag. But given the rates, she may have to abandon that plan.
“That was one of our big initiatives for 2025, where we moved all of our bags to China for 15 cents per bag,” she said. “And now I don’t know if we can save money on the bags if the tariffs go into effect.”
Warehouse prices are also going up because of the expected tariffs, Orley said. Its warehouse provider said demand has increased since the rates were announced.
“As many other companies buy bulk supplies abroad to stay ahead of tariffs, warehouse availability will be limited, which will increase costs for everyone,” she said.
So Orley is trying to lock in its warehouse contract for 2025 and find a third-party logistics provider for that year, “to anticipate what’s coming and plan as much in advance as possible,” she said.
Across the border in Canada, Julie Bednarski-Malik runs another snack company, Healthy Crunch, based in Mississauga, Ontario, which specializes in foods that are free of the top 11 major food allergens such as peanuts, tree nuts and dairy, and are also low in are related to foodstuffs. sugar.
She sells her products in both Canadian and U.S. stores, and said tariffs will impact consumers on both sides.
“If you have a severe anaphylactic reaction to a certain type of dairy or soy and you can’t find a product in the U.S. because we’re the only ones making it, then it’s going to be a lot more expensive for U.S. consumers,” he says. Bednarski-Malik said, “So I think these tariffs will not only hurt other countries like Canada, but also American consumers.”
