Town Center Music in Suwanee, Ga.
Contact your representative today and urge them to work with the White House to scale back these tariffs. Ask them to support clear, consistent trade policy that puts American small businesses first — not last. Tell them what these tariffs mean for your job, your store and your town.
It’s never a good sign when Americans remember the day their economy changed. Take Oct. 24, 1929, when the stock market crashed to kickstart the Great Depression. Or Sept. 15, 2008, when the subprime mortgage crisis climaxed and plunged the global economy into a financial crisis.
According to President Donald Trump, April 2, 2025, the day he unveiled sweeping global tariffs, will be remembered as a turning point in American history. He might be right. But for small retailers, his so-called “Liberation Day” is more likely to be remembered in the company of Black Thursday and the Crash of ‘08 than as the beginning of a new era of American prosperity.
As the “reciprocal” tariffs go into effect, they will immediately raise costs for importers bringing goods into the United States. But these costs don’t exist in a vacuum. They don’t consider the expenses of running a business, such as paying staff salaries, marketing, depreciation, distribution costs, taxes and other operating expenses.
With many Asian countries facing particularly high tariff rates, the price of consumer staples like shoes, clothing and electronics is expected to rise, putting pressure on retailers to increase prices. That not only threatens consumer spending but also undermines the American jobs created by providing more affordable products.
Up and down Main Streets across the country, small retailers must now grapple with what happens next.
Do they cut into already-slim profit margins to absorb the cost? Do they order less and offer less choice for customers? Do they raise prices and risk driving away price-sensitive customers?
“Our store is a small Christian bookstore in Dallas, Texas. We’ve already received notices from several vendors notifying us that prices are going to increase on the products we buy from them,” says Terri Williams, director of Oak Cliff Bible Fellowship Bookstore. “In preparation for the spring and summer, we will have to cut back on purchases, raise prices and expect much lower profit margins.”
“Our merchandise becomes more expensive, leading to fewer overall sales,” says Aaron Brown of Town Center Music in Suwanee, Ga., “all at a lower margin due to manufacturers raising prices to compensate.”
For many small retailers, the cost of doing business is already out of control — labor, insurance, rent, taxes and credit card processing fees have all climbed. Tariffs are one more pressure point.
“Adding in additional product costs with the tariffs is creating more stress on already slim margins,” says Anne Vagasky, owner of Peachtree Street, a gift shop in Powell, Ohio.
“We’ve weathered a pandemic, administration changes, stimulus money, inflation and more,” says Emily Boone, who has owned women’s boutique By A Thread in State College, Pa., for seven years. “Now, we’re being forced to navigate tariffs while still paying everyday expenses, our team, and competing with big-box stores.”
How much and how quickly shoppers will rein in their spending remains unclear. NRF has forecast retail sales in 2025 to grow between 2.7% and 3.7%. But with tariffs now spanning the globe and ranging from 10% to 145%, it is very difficult to directly measure the breadth, quantum and duration of the tariffs on retail sales at this time. One estimate suggests these tariffs could result in a $3,800 tax increase per household — squeezing budgets and reshaping spending priorities.
“As the owner of a music instrument and accessory store, these tariffs exert pressure from two sides,” Brown says. “First, a cost increase in general goods leaves households with fewer discretionary dollars to spend on businesses like mine. We’re understandably viewed as a secondary expense to things like clothing and new appliances.
“Second, our merchandise becomes more expensive, leading to fewer overall sales, all at a lower margin due to manufacturers raising prices to compensate.”
The president’s announcement was supposed to bring clarity after weeks of economic chaos and help businesses plan for the future. Instead, that future feels cloudier than ever.
As rumors swirl about which tariffs will stick, which might be lifted and what the process for reducing or removing them will look like, the real question becomes: What is the pain threshold for consumers and businesses?
For many small retailers, that threshold is already being tested. Pricing decisions, inventory planning and hiring timelines are now clouded by uncertainty. Without clear guidance — but with plenty of risk — businesses are left guessing, trying to balance rising costs, shifting consumer demand and the possibility of long-term damage to their operations.
“We feel like we’re collateral damage here.”
Bobby Djavaheri is the president of his grandfather’s 50-year-old company Yedi Houseware, which sells air fryers, pressure cookers and dinnerware. All his products are manufactured in China — because nowhere else in the world has the capacity to make hundreds of thousands of air fryers. And no facility in the U.S. can produce his small electrics. “If there was, I’d be there yesterday,” he says.
With so much volatility clouding U.S.-China trade, Djavaheri is forced to adjust his forecasts on a near-daily basis. He’s planning production orders for Christmas, his peak shopping season, without knowing the final cost of his landed goods. At the same time, he must allocate capital for hiring, marketing, advertising and more.
In short, he says, “We feel like we’re collateral damage here.”
Djavaheri isn’t alone. Across the industry, retailers are making critical decisions about holiday orders that typically account for 20%-30% of their annual revenue. Now, many are being forced to scale back, delay or hedge their bets. With tariff rates in flux and no clear sense of which costs will stick, it’s nearly impossible to price, promote or plan ahead.
The holiday season is the most important time of year for retail — and this year, it could be defined more by what’s missing on shelves than what’s wrapped under the tree.
If they guess wrong, retailers could either lose their margins or lose their customers. There is no winning scenario.
Vagasky distills the cost of uncertainty into stark acceptance: “Small businesses are the heart and soul of our communities, but I also recognize that these imposed tariffs will ultimately force more small businesses to close.”