NEW YORK — For many American small business owners, the latest round of tariffs on Chinese imports has pushed them to the brink. With tariffs now as high as 145%, major product shipments are stranded overseas, invoices are piling up, and future operations are uncertain.

While President Donald Trump recently hinted that the tariffs could “come down substantially,” the damage is already being felt. For small businesses operating on tight margins, the financial strain and policy unpredictability have created a crisis with no clear end in sight.

In Manchester-by-the-Sea, Massachusetts, WS Game Company—a family-run business that creates deluxe editions of Hasbro classics like Monopoly and Scrabble—has seen its 25 years of growth abruptly stall.

The company’s games, which retail for $40 and were featured on Oprah’s Favorite Things list in 2024, are manufactured entirely in China. Now, three of its shipping containers—carrying $500,000 worth of finished games—are stuck overseas. More critically, the company lost $16 million in orders from three major U.S. retailers.

“We can’t just switch manufacturers overnight,” said owner Jonathan Silva. With only about four months of financial runway left, Silva warns, “These tariffs have disrupted our business and put us on the verge of insolvency.”

In Lexington, Kentucky, Jeremy Rice co-owns House, a home décor store that relies heavily on silk flowers from China—about 90% of their inventory.

Vendors are already hiking prices by 20% to 25%, and smaller suppliers are expected to raise them even higher. Despite ordering holiday stock early, Rice only has enough everyday inventory to last a few months.

“After that, I don’t know what we’re going to do,” he said, fearing a wave of small store closures similar to what happened during the Great Recession and the pandemic.

In Ann Arbor, Michigan, Lisa McDonald, owner of TeaHaus, says the tariffs have left her with a sinking feeling. Her shop, located near the University of Michigan, has served premium teas for nearly 18 years.

With the U.S. importing almost all of its tea due to climate and cost, McDonald can’t simply shift suppliers. Her premium blends—some priced up to $33 for a 50g bag—could become unaffordable if tariffs stay in place.

“We can’t just flip a switch and grow tea in America,” she said. “It’s not realistic.”

Jim Umlauf, owner of 4Knines in Oklahoma City, makes pet-friendly seat covers and cargo liners for vehicles—products that require specialized materials from China.

Umlauf tried moving production elsewhere after the 2018 tariffs but hit roadblocks. Now, with the newest tariffs in place, he says they’re barely surviving. “We have a limited amount of inventory left, and without some relief, we’ll run out soon.”

Frustrated by the lack of response from government officials, Umlauf added: “It’s time for policymakers to understand that trade policy affects real people, not just stock prices.”

For small businesses across America—from tea sellers to board game makers—the tariff war with China is doing more than reshaping trade policy. It’s threatening their very survival. Without swift relief or support, many could soon shut their doors for good.

Source: AP News – ‘Nowhere to turn’: Small businesses dependent on imports from China are feeling more desperate

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The U.S. stock market took a massive hit on Thursday, with over $2 trillion in value wiped out after President Donald Trump announced sweeping tariffs on foreign imports. The market suffered its worst single-day drop since the COVID-19 economic crash five years ago, with fears mounting that the new tariffs could push the country into a recession.

Almost every sector experienced significant losses as investors scrambled to offload shares of companies expected to be hardest hit by rising costs. Economists have labeled the tariffs a severe economic blow, warning that they could trigger a chain reaction leading to lower consumer spending, stalled business growth, and a potential economic downturn.

Olu Sonola, head of U.S. Economic Research at Fitch Ratings, described the situation as a “game changer” not just for the U.S. but for the global economy. “Many countries will likely end up in a recession,” Sonola stated.

The S&P 500 plunged 4.8%, erasing more than $2 trillion in market value, according to Howard Silverblatt, a senior index analyst at S&P Dow Jones Indices.

As higher prices put a squeeze on household budgets, discretionary spending—including travel—may be among the first to decline. Airline stocks plummeted:

• United Airlines: -15.6%
• American Airlines: -10.2%
• Delta Air Lines: -10.7%

With most apparel and footwear brands manufacturing overseas, tariffs on imports could drive up costs for both businesses and consumers. Major losses included:

• Nike: -14.4%
• Under Armour: -18.8%
• Lululemon: -9.6%
• Ralph Lauren: -16.3%
• Levi Strauss: -13.7%

Big-box and online retailers, heavily reliant on imported goods, saw their stock values tumble as fears of rising prices and reduced consumer spending set in:

• Amazon: -9%
• Target: -10.9%
• Best Buy: -17.8%
• Dollar Tree: -13.3%
• Kohl’s: -22.8%

Tech companies, many of which depend on foreign parts and manufacturing, are expected to face supply chain disruptions and higher costs:

• Apple: -9.2%
• HP: -14.7%
• Dell: -19%
• Nvidia: -7.8%

A potential recession could reduce borrowing and lending activity, impacting major financial institutions:

• Wells Fargo: -9.1%
• Bank of America: -11.1%
• JPMorgan Chase: -7%

As Americans tighten their budgets, discretionary spending on dining out may decline, leading to drops in restaurant stocks:

• Starbucks: -11.2%
• Cracker Barrel: -12.7%
• Cheesecake Factory: -9.4%

Despite concerns, automakers fared slightly better than other industries, as much of their steel and aluminum is already sourced domestically:

• General Motors: -4.3%
• Ford: -6%
• Tesla: -5.5%
• Stellantis: -9.4%

Economists and analysts will be watching closely to see whether consumer confidence and spending can withstand the financial strain of the tariffs. If spending slows significantly, businesses may cut production, leading to job losses and a broader economic slowdown.

For now, the U.S. stock market remains on edge, with investors bracing for further turbulence in the coming weeks.

Source: AP News – Fear that Trump tariffs will spark recession wipes out more than $2 trillion in value from US stocks

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A recent ransomware attack on a major software provider has caused significant disruptions for several companies, including Starbucks and U.K. grocery chain Morrisons.

The attack targeted Blue Yonder, a software company that provides supply chain technology to global brands. On Thursday, Blue Yonder acknowledged service disruptions caused by the ransomware incident, which affected systems used by various clients.

For Starbucks, the attack impacted the company’s ability to manage barista schedules and track employee hours. As a result, store leaders across North America have been instructed to use manual workarounds until the issue is resolved. Despite these disruptions, Starbucks reassured customers that service at its stores remains unaffected. The company emphasized that ensuring employees are paid correctly for all hours worked is a top priority. By Tuesday morning, Starbucks confirmed that payroll processing had resumed.

Blue Yonder is continuing efforts to restore its services to normal, while affected companies work to resolve any ongoing issues caused by the breach.

Source

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