In recent months, a series of steep tariffs enacted by President Trump has sparked international trade tensions, taking a particularly heavy toll on small businesses. Since the beginning of his second term, Trump has threatened to impose significant tariffs on a wide range of countries and goods. On April 5, a new policy took effect, introducing a minimum 10% tariff on imports from nearly all countries and territories. China faced a significantly higher rate of 145%, as a fentanyl emergency tariff from earlier this year remains in effect. Additionally, according to the Office of the United States Trade Representative, the U.S. imported a total of $438.9 billion worth of goods from China.
According to a White House statement made on Feb. 1, Trump imposed these tariffs as a response to what he saw as a national emergency of illegal immigration and the flow of drugs — particularly fentanyl — into the U.S. The goal was to hold Canada, Mexico, and China accountable for their promises to tackle these issues.
Tariffs themselves aren’t inherently good or bad. Governments use them for a variety of reasons: to protect domestic industries by making imported goods more expensive, to encourage consumers to buy locally produced goods, and to raise revenue. With that said, “the tariffs that are currently being proposed can only cause harm,” claims Bitty Eagan, the owner of Bolt Fabric Boutique. “They are already causing worldwide financial market volatility. They will eventually, either by raising prices or damaging company valuation, force larger companies to reduce costs by laying off employees. More people without jobs means that more businesses will struggle because their customers will not have the financial security to buy goods,” she explains.
Some small businesses are especially worried about their chances of survival under Trump’s tariff plan. Many don’t manufacture everything themselves and rely on imported materials or products. Because tariffs raise the cost of these imports, small businesses usually don’t have the flexibility to absorb those costs like large corporations do. This leaves them with a tough decision: either pay more and earn less profit, or pass the cost on to customers and risk losing sales.
Even just the threat of tariffs can make markets unstable. Small businesses are particularly vulnerable to uncertainty, often becoming hesitant to expand and hire. “I’m hopeful that we will be able to get through some difficult times; however, I know of many smaller, textile-based businesses that are already beginning to struggle,” Eagan says. “Businesses like small fashion lines that make their products in the U.S. [are] out of imported fabric. Eventually, many small businesses are likely to fail, and the people who rely on those businesses for their livelihoods will no longer have jobs,” she adds.
Eagan is among many business owners who are bracing for impact. Considering very little apparel and quilting fabric is milled in the U.S., nearly everything that Bolt sells needs to be imported. “We’ve always paid some tariffs on some of the fabrics that we import, but the proposed tariffs will be many times more than what we have historically paid,” she says. While Bolt is already encountering some shipment delays, it is nothing consequential just yet. Nevertheless, Eagan has a plan: “We have tried to purchase as much of our inventory as possible now, before the tariffs are implemented, so that we will be able to keep our prices down as long as possible,” she says. Right now, Bolt is looking to acquire more deadstock fabrics — fabrics that are left over after garment manufacturing. “These types of fabrics will become more scarce as garment manufacturers address rising costs by purchasing smaller amounts of fabric. Ultimately, if the proposed tariffs are implemented, we will have to pass those costs onto our customers,” Eagan states.
Kabinett, a furniture and cocktail goods store in Portland, also sources most of its inventory internationally. “At the moment, we are in a holding pattern,” Trent DeBord, the owner of Kabinett, explains. “Recent re-stocks have not shown any change in prices … but it’s early in the game.” Shipping costs have already increased slightly, a trend DeBord attributes to “unregulated greed” in the oil and shipping industries.
Kabinett relies on imports, including vintage furniture from India, and over 200 types of vermouths and aromatized wines from Spain, Italy, and France. For Kabinett, tariffs pose a serious threat. “If the tariffs stick, we’re at their mercy,” DeBord says. Unlike larger corporations, Kabinett depends on smaller suppliers who are less likely to hike their prices immediately, but there’s no guarantee that goodwill can last indefinitely. Still, Kabinett plans to resist passing new costs onto customers for as long as possible. “We will do everything we can to keep prices exactly where they are,” DeBord says.
Tariffs will not only affect imported goods that are sold directly. They could also affect products manufactured in the U.S. that have imported components — things like food packaging, for example, or farm equipment. “If our customers are paying more for essential items like food and medicines, they will be less able to pay a higher price for non-essential items like fabric,” Eagan explains.
Kimberly Livesay, a social studies teacher at Franklin, elaborates: “When people have economic concerns, they’re less likely to spend money on additional products.” Small businesses have very small profit margins, so when tariffs eat into those margins, consumers ultimately pay the price. “Big picture, these tariffs are breeding economic uncertainty because policy is changing rapidly. In economics, you always want things to be predictable and consistent, and [the tariffs are] shaking things up,” Livesay says.
Regarding employment, it’s important to take a step back and consider the broader economic situation. When any nation experiences a prolonged period of negative economic growth, its job market is going to suffer. While currently, the unemployment rate in Portland is relatively low, that could change quickly. If small businesses — especially those with narrow profit margins — are affected by Trump’s tariffs and supply chain disruptions, they will struggle. If costs go up and consumers stop buying non-essential or high-end products, these businesses might be forced to shut down or lay off workers. These staff cuts will cause the unemployment rate to rise, pushing the economy closer to a recession.
When the U.S. imposes tariffs on other nations, those countries and territories often won’t hesitate to retaliate by imposing their own tariffs on U.S. exports. Small businesses that export goods could face new challenges in selling abroad. While big companies are better able to withstand high tariff-related costs or make needed adjustments to stay afloat, small businesses have fewer resources and less flexibility.
Sudden changes in tariff policy not only make it hard for small businesses to compete both domestically and internationally, but they also make it more difficult to plan ahead. Small businesses often can’t quickly switch to domestic sources or alternative suppliers abroad, so they’re more vulnerable when costs spike or supplies get delayed. “The infrastructure for a lot of manufacturing no longer exists here in the US, and bringing it back will be very expensive and take years, if not decades,” Eagan says. “It’s not realistic or fair to tax businesses for importing goods that are impossible to buy domestically.”
However, for small businesses that don’t rely on imports or source their inventory and products internationally, these tariffs don’t pose much of a threat at all. Although sourcing within the US is almost always more expensive, their operations will most likely remain unaffected, allowing them to maintain stable pricing and supply chains. In some cases, these businesses may benefit from reduced competition if imported goods become more expensive.
The future of the U.S. economy is looking uncertain, but not all hope is lost for small business owners. Among the chaos, DeBord is staying optimistic. “We’ll continue to run a business that is a safe space for everyone to come look at beautiful things, and have a nervous laugh about the state of our country,” he says.
As the U.S. economy continues to change, it is unclear how these tariffs will play out. For now, small business owners are doing their best to adapt — watching, waiting, and adapting to whatever comes next.
