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Trump wants to greatly expand import duties. Entrepreneurs who weathered his first round, which Biden largely left intact, say they’d have to raise prices to survive.
By Alexandra Byrne
Nov. 1, 2024
With former President Donald Trump floating higher and more far-reaching tariffs if he’s elected to a new term, small businesses that sell everything from bikes to beer are nervous about another cost hike that they’d have to pass on to customers.
Chris Smith, the co-founder of Virginia Beer Co. in Williamsburg, Virginia, remembers when he first spotted a 5.5% surcharge on a statement from one of his suppliers, a U.S.-based seller of tap handles manufactured in China. The fee turned up in September 2019, after Trump placed 25% tariffs on steel, and hasn’t gone away since.
Smith spends anywhere from $15,000 to $20,000 each year on tap handles emblazoned with the names of his beers — with about $1,000 of that covering the cost of the tariff. He sells them to distributors that get them placed in bars and restaurants that sell his draft beers, increasing the price to cover the tariff surcharges.
“The beer business specifically is a low-margin, high-volume business,” he said. “We don’t have the volumes that a major player has just by virtue of our size.”
By contrast, Constellation Brands, which imports Corona and Modelo from Mexico and recently reported about $3 billion in quarterly revenue, has waved off concerns about further tariffs, saying the company thrived under Trump. But smaller operators have less wiggle room, Smith said: “Any increase in our input costs absolutely affects our profitability.”
So far, the tariffs in force under both White Houses have cost Americans $79 billion, the nonpartisan Tax Foundation estimated this summer.
“For the small businesses, unfortunately they’re not in a position where they can absorb those additional costs,” said Jonathan Gold, vice president of supply chain and customs policy at the National Retail Federation, a major trade group.
The nation’s roughly 33 million small businesses employ nearly half the nation’s workers and generate more than 43% of the gross domestic product, the U.S. Chamber of Commerce estimates. And it’s small and medium-sized firms that disproportionately bear the burden of tariffs, Gold said; in many cases, “they’ve got to go ahead and pass those costs directly on to the consumer.”
Full article:
https://www.nbcnews.com/politics/20...ffs-small-business-consumer-prices-rcna177306
Trump wants to greatly expand import duties. Entrepreneurs who weathered his first round, which Biden largely left intact, say they’d have to raise prices to survive.
By Alexandra Byrne
Nov. 1, 2024
With former President Donald Trump floating higher and more far-reaching tariffs if he’s elected to a new term, small businesses that sell everything from bikes to beer are nervous about another cost hike that they’d have to pass on to customers.
Chris Smith, the co-founder of Virginia Beer Co. in Williamsburg, Virginia, remembers when he first spotted a 5.5% surcharge on a statement from one of his suppliers, a U.S.-based seller of tap handles manufactured in China. The fee turned up in September 2019, after Trump placed 25% tariffs on steel, and hasn’t gone away since.
Smith spends anywhere from $15,000 to $20,000 each year on tap handles emblazoned with the names of his beers — with about $1,000 of that covering the cost of the tariff. He sells them to distributors that get them placed in bars and restaurants that sell his draft beers, increasing the price to cover the tariff surcharges.
“The beer business specifically is a low-margin, high-volume business,” he said. “We don’t have the volumes that a major player has just by virtue of our size.”
By contrast, Constellation Brands, which imports Corona and Modelo from Mexico and recently reported about $3 billion in quarterly revenue, has waved off concerns about further tariffs, saying the company thrived under Trump. But smaller operators have less wiggle room, Smith said: “Any increase in our input costs absolutely affects our profitability.”
So far, the tariffs in force under both White Houses have cost Americans $79 billion, the nonpartisan Tax Foundation estimated this summer.
“For the small businesses, unfortunately they’re not in a position where they can absorb those additional costs,” said Jonathan Gold, vice president of supply chain and customs policy at the National Retail Federation, a major trade group.
The nation’s roughly 33 million small businesses employ nearly half the nation’s workers and generate more than 43% of the gross domestic product, the U.S. Chamber of Commerce estimates. And it’s small and medium-sized firms that disproportionately bear the burden of tariffs, Gold said; in many cases, “they’ve got to go ahead and pass those costs directly on to the consumer.”
Full article:
https://www.nbcnews.com/politics/20...ffs-small-business-consumer-prices-rcna177306
