Small businesses across the United States are bracing for the financial impact of President-elect Donald Trump’s proposed tariffs.
His proposals include a 25 percent tax on all products from Canada and Mexico, as well as an additional 10 percent tariff on products from China.
These measures – intended to combat illegal immigration and drug trafficking – are expected to increase costs for small businesses that rely on imported materials and goods. About two-thirds of all U.S. vegetable imports and half of fruit and nut imports come from Mexico, according to the U.S. Department of Agriculture.
Before his victory in November, Trump told a rally in Michigan that “tariffs are the greatest thing ever invented.” He also described the term “tariff” as “the most beautiful word in the dictionary”.
“Mexico and Canada have the absolute right and power to easily resolve this long-simmering problem,” he later wrote on his Truth Social platform.
“It’s time for them to pay a very heavy price!”
Smith/Gado/Getty Images Collection
How Tariffs Could Affect Product Prices
Laurel Orley, co-founder and CEO of Daily Crunch, a Nashville-based sprouted nut snack company, initially thought the tariffs would not affect her business due to minimal imports.
However, she soon realized the broader implications.
“That was one of our big initiatives for 2025, shipping all of our bags to China for 15 cents a bag,” Orley said. “And now I don’t know if we’ll be able to save money on bags when the tariffs go into effect.”
Anticipated tariffs have also led to an increase in warehouse prices.
The Orley warehouse provider has noted an increase in demand as businesses stockpile inventory to avoid future tariffs.
“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.
AP Photo/Wilfredo Lee, file
“Pre-planning” key for US businesses
In response, Orley is working to secure its warehouse contract for 2025 and is seeking a third-party logistics provider to mitigate potential disruptions.
“We try to anticipate what’s going to happen and plan as much as possible,” she added.
The impact extends beyond American borders. Julie Bednarski-Malik, who runs Healthy Crunch in Mississauga, Ontario, specializes in snacks free of the top 11 allergens, sold in the Canadian and American markets.
She fears the tariffs could lead to higher prices for consumers, particularly those with specific dietary needs.
“If you have a severe anaphylactic reaction to a 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,” she says .
(Brandon Bell/Getty Images)
Will Trump really impose tariffs?
It’s unclear whether Trump will actually follow through on his threats or use them as a negotiating tactic before he returns to the White House in the new year.
Bednarski-Malik is awaiting final pricing details but anticipates an increase in costs.
“Ultimately, the consumer will have to pay ultimately because our margins are so tight, starting with our food prices, [which] have increased dramatically in recent years,” she noted.
“So there’s not much room left to keep the same price and maintain that price while being subject to an additional 25 percent tariff on our product.”
This article includes reporting from the Associated Press.
