(This column originally appeared in the Inquirer)
It’s been six months since President Donald Trump announced new tariffs on U.S. imports. For local small-business owners, the impact so far depends on what they sell. But they’re all thinking ahead about more adjustments they will have to make.
Trump declared an “Independence Day” on April 2, implementing a minimum 10% tariff on all countries selling products into the U.S., with larger ones on countries including India and China. Since then the president has either threatened or implemented additional tariffs on certain products such as steel and aluminum, sectors such as furniture, and “reciprocal tariffs” on countries to match their tariffs on American imports.
Many economists have warned that these higher costs will drive up inflation, slow our economy, and hurt many small businesses that rely on imported goods.
Fred Woll, president of Philadelphia packaging products supplier F.P. Woll & Co., said he’s seen tariffs from overseas suppliers but “decided to eat a 5% price increase.” He doesn’t think he can do that again.
“I am beginning to pass on items where the cost has gone up too much to be realistic for the consumer,” she said. “I fear that product selection will decrease, and many manufacturers will end up going out of business and retailers will follow.”
“We will have to get used to paying more money for less product,” Gillen-Doobrajh added.
Not every company is suffering. The family-run Trappe Tavern in Trappe, Montgomery County, has not seen a significant impact.
“We’ve had some prices creep up,” David Duryea, the restaurant’s owner said. “In general, it hasn’t really had much of an effect at all.”
If the costs of his food and other supplies continue to go up, Duryea said, people will eventually cut back on their spending and that could affect his business.
“If that happens, we’re going to have to raise prices like everyone else,” he said.
Despite new tariffs on steel, Upper Darby-based Delaware Valley Steel has not been significantly impacted, at least for now. That’s because “we don’t import any of our inventory,” said Jerry Sharpe, the company’s CEO.
However, Sharpe warns that whenever tariffs are applied, the domestic steel mills that sell him products see that as an opportunity to raise prices.
“If demand picks up, which I believe it will later this year, we will see increased pricing from the domestic mills,” he said. “We’re also going to be hit with a 20% tariff on an expensive piece of machinery we have ordered.”
Kevin McLaughlin, a partner at business advisory firm Centri Consulting in Philadelphia, said the common theme among his firm’s clients is uncertainty.
“While the full impact of tariffs has not yet sifted through every corner of the economy, growing businesses and businesses with thinner margins and less negotiating power than large corporations are often the first to feel the pressure,” he said.
How small-business owners are navigating tariff uncertainty
Woll says he’s focusing on cutting his overhead and may lay off employees. Gillen-Doobrajh is changing her product mix by “stocking up where tariffs are low” and foregoing unnecessary items.
“I’m trying to be really smart and frugal with buying overall,” she said. “I am also paying attention to where items are made and holding out hope that these tariffs will dissolve so that our industry can survive.”
Frank Cettina, who runs operations at Computer Components Corp., a precision tools contract manufacturer based in Philadelphia, is passing along any added costs to customers, with transparency. Tariff-related cost increases are noted separately and determined “on a customer-by-customer basis,” he said.
“We are not making blanket cost increases because our intention is to remove them when and if they go away or change,” Cettina said. “We are also offering any alternative sources where we can.”
Patti said he will likely buy less product but will also “buy higher quality just to pick up my margins” and compensate for the loss of volume.
McLaughlin, the consultant, struck a more positive tone. He said clients are “stress-testing” multiple “what-if” scenarios so their businesses can adapt quickly.
“With all the uncertainty, we are consistently encouraged by how resourceful our clients are through this unique time,” he said. “Many are using this moment as an opportunity to strengthen supplier relationships, accelerate efficiency, and polish their value propositions.”
