Trade chaos leads small businesses to rethink US relationships
- The San Juan Daily Star
- 3 hours ago
- 5 min read
By NADAV GAVRIELOV
The tea farmer in Japan, the shoe company in Montreal, the chocolatier in Mexico: Small businesses around the world have been roiled by President Donald Trump’s constantly changing trade policies.
The trade rules have upended strategies, prices, logistics and investments as businesses try to both inform and hold on to their U.S. customers. Some small companies, which operate on razor-thin margins, are questioning or pausing their U.S. expansion plans. We spoke to six businesses, from Sweden to Brazil, about how they’re communicating with customers and managing the uncertainty. Here’s what they said.
For a Swedish designer, sales surged and then slumped.
Asket, a Stockholm-based clothing company, emailed its U.S. customers in mid-August warning of possible price increases and the expiring de minimis exemption, which allowed the duty-free entry of merchandise valued at under $800. “It’s not super sexy communication,” said August Bard Bringeus, Asket’s co-founder and CEO. But it prompted a spending spree, with U.S. sales more than doubling over 10 days.
The company has kept prices steady, taking a hit on its margins. “It will probably need to change,” Bard Bringeus said, adding: “We’ll probably need to increase prices in the future to regain what we’re losing now.” European Union exports to the United States are now subject to a 15% tariff.
The uncertainty has been frustrating. “It’s not like all European brands are going to start manufacturing in the U.S. all of a sudden; it’s impossible,” said Bard Bringeus.
The United States is one of the Swedish retailer’s biggest markets, but U.S. sales fell in the third quarter, when de minimis ended, and are now down about 20% from a year ago.
“I think there’s just a general aversion, probably, toward buying from European brands because you have this notion that you’re going to be hit by tariffs or that your order is going to be charged with customs and duties,” Bard Bringeus said.
A Canadian shoe seller hits ‘pause’ on a U.S. expansion.
Just before the end of de minimis, Maguire, a Montreal-based shoe company, told its American customers that it would ship from its U.S. stores, and encouraged them to order before the loophole closed. A surge in U.S. orders followed.
About a week later, Maguire sent another email announcing a price increase. Myriam Belzile-Maguire, its president and co-founder, said that she raised prices between $10 and $30 in both the United States and Canada.
The company has two stores in the United States, its second largest market, but is waiting before opening more. “I want to wait for a bit more stability,” Belzile-Maguire said.
A Brazilian coffee grower waits for U.S. customers to return.
After a 50% tariff on Brazilian coffee choked off U.S. orders, Ana Cecilia Velloso, whose family owns São Luiz Estate Coffee in Carmo do Paranaíba, Brazil, had planned to skip a San Diego coffee expo to market her beans. Now that those tariffs have been revoked, she’s considering going, but she’s wary. “I need to wait for the C market to settle down,” she wrote in a text, adding: “I’ll wait for my customers to come to me.”
Before the tariffs were imposed, Mariana Faerron Gutierrez, founder and CEO of Tico Coffee Roasters in Campbell, California, had planned to import Velloso’s coffee. “If the tariffs wouldn’t have happened at that level,” she said, “her coffee would be here in my warehouse right now.”
Now, she’s looking to get Brazilian coffee as soon as she can. And while she’s optimistic that tariffs won’t change again this year, she’s cautious. “What is the contingency plan if something changes?” she said. “It might be tariffs again, or it might be something else.”
A Japanese matcha farmer opens a U.S. outpost.
Daiki Tanaka, who grows and sells matcha in Japan, meets many of his U.S. customers during tours and tastings at his 10-acre farm, d:matcha, near Kyoto.
But the end of the de minimis exemption this year meant many of his shipments to the United States now carried a 15% tariff. He responded by creating a U.S. subsidiary to import his tea and distribute it, absorbing the tariff for American customers who make up his biggest direct-to-consumer market. “The connection is important, so that’s why the tariff thing is really — it makes it a bit more complicated,” Tanaka said.
Lauren Purvis, founder of Mizuba Tea Co. in Portland, Oregon, imported more than 20 tons of matcha from small farms and producers in Japan last year. This year, tariffs have cost her over $110,000, Purvis said, and the trade policy has led to big delivery delays: She had over $120,000 worth of Japanese matcha, shipped in August and September, stuck in Kentucky. She’s still waiting for about half that inventory.
The Trump administration in recent weeks lifted some tariffs, including those on green tea. But Purvis wishes they had been more carefully planned from the outset. “All it did was increase costs,” she said. “I think it is hard to shake the feeling of ‘What was the point?’”
A Mexican chocolatier sends customers to Canada.
Víctor Feliu, who owns Feliu Chocolate in Guadalajara, Mexico, was so confused by the ever-changing rules for trade between Mexico and the United States that he has paused U.S. shipments.
“I’m willing to pay tariffs and I’m willing to comply with the paperwork,” he said. “But it’s very difficult if rules are changing every few months.”
While his chocolate bars are not subject to tariffs, he paused U.S. shipments in early September after more than a dozen packages were returned because of complications posed by the new rules, which covered things including labeling, paperwork and registration, he said. It took weeks for Feliu to track down the new requirements for small shipments. “We’re a small business; no one tells us,” he said.
He has suggested that U.S. customers buy his chocolate through a Canadian retailer, and his plans to sell through U.S. shops are on hold.
For a Danish retailer, mistakes cost money.
Tariff-related errors are proving costly for Cecilie Moosgaard, a co-founder of the Danish accessories retailer Lié Studio.
“We’re seeing a lot of these mistakes, meaning that our import duties are much higher than they need to be,” Moosgaard said. On several occasions, she said, Lié Studio handbags shipped to the United States were misclassified as originating from China — and subject to tariffs as high as 25% — rather than Portugal, where they were made, which carries a lower tax. The mistakes mean unexpected costs and time spent trying to get a refund — which she’s still waiting for.
The company, which sells jewelry and handbags online and at U.S. retailers, increased prices for U.S. customers by around 20% in mid-August.