Small Businesses Struggle with Uncertainty from Short-Term Trade Deal

Small Businesses Face Uncertainty with Short-Term Trade Deal As small business owners navigate a rapidly changing economic landscape, the recent 90-day trade agreement between the U.S. and China is creating significant uncertainty for many. Business leaders express concern that a short reprieve from high tariffs may not be enough time to plan confidently for the future, leading to delays and alterations in business strategies. Under the terms of the latest trade agreement with China, tariffs on imports have decreased from an alarming 145% to 30%. However, this agreement is limited to just 90 days, leaving many business owners uncertain about their future costs and strategies. "This pause on the tariffs doesn’t really help me. In fact, it just kind of terrifies me," noted Connor Alexander, a board game publisher based in Seattle. "If that pause goes back to 145%, I'm out of business. I’m done." Feedback from various small business owners illustrates a growing sense of anxiety regarding the implications of the new tariffs. Many report that although they appreciate the reduced tariffs, the 90-day duration is insufficient for making meaningful decisions. "Business feels like a guessing game," stated one entrepreneur. For Alexander, who runs Coyote and Crow Games, the uncertainty surrounding tariffs affects his production cycle, even causing him to halt certain projects when tariffs were high. With the hope of shipping a new board game in about 60 days, he remains concerned that the tariffs could revert before his product arrives, complicating his pricing strategy further. Haley Pavone, CEO of Pashion Footwear, echoed similar frustrations. "If I could make a shoe in 10 minutes, I’d be stockpiling right now, but they take four months to make," she explained. While she awaits the arrival of her summer shoes, she has yet to finalize her holiday orders due to the unpredictability of future tariffs. Entrepreneurs like Hugo Ramirez, who operates an ice cream and churro shop in Wisconsin, have already pivoted their sourcing strategies in response to past tariffs. Previously reliant on imports from China, he has shifted to U.S. suppliers, which have proven more expensive and less customized. This shift has forced him to cancel orders and rethink his expansion efforts, leaving him uncertain about the potential benefits of the current trade arrangements. Jessica Kim, who runs a vending machine company that sources equipment from China, commented on the challenges of timing shipments amid fluctuating tariffs. Her recent order of machines was significantly delayed because of high tariffs, and while she is now set to receive them, the unpredictable nature of tariffs makes strategic planning nearly impossible. "I was trying to time it, almost like gambling," she remarked. Overall, these small business owners face considerable challenges due to the temporary nature of the tariff agreement. With no clarity on the future, they are left to balance the need for immediate action against the risks of potential economic setbacks. Many echo the sentiment that the current trade policies need to provide stable long-term solutions to truly support small businesses. Read the original article on Business Insider