U.S. Businesses Brace for Potential Trump Tariffs on Imports
U.S. Businesses Brace for Potential Trump Tariffs on Imports
LOS ANGELES, Nov 6 (Reuters) – As President-elect Donald Trump’s plans for substantial tariffs on imports from countries like China and Mexico loom, some U.S. companies are taking precautionary steps to mitigate potential impacts.
Trump has suggested a 10% tariff on all imports and a 60% tariff on Chinese products, with an additional threat of a 25% tariff on Mexican imports. These measures, if enacted, could drive up prices for American consumers and risk triggering retaliatory tariffs on U.S. exports. Economists caution that such tariffs could elevate import duties to levels not seen since the 1930s, risking inflation, disrupting trade with China, and prompting a major restructuring of supply chains.
Hong Kong-based M.A.D. Furniture Design is accelerating shipments of its Chinese-made furniture to its Minneapolis facility by 50% to preempt potential tariffs, according to co-founder Matt Cole.
Similarly, Jimmy Zollo, co-founder of Chicago’s online retailer Joe & Bella, has quadrupled orders for their top-selling Chinese-made shirts and doubled orders for adaptive pants for adults with limited mobility. Zollo aims to receive these goods before Chinese New Year when factories close, often delaying orders for small businesses.
In response to Trump’s previous tariffs from his 2017-2021 term, importers often rushed to bring in goods ahead of deadlines, a tactic known as “front-loading.” However, the scope of these new tariffs is wider, leading some business owners to forgo early shipments due to the high costs of storage and expedited shipping. Hilla Hascalovici, CEO of Periodally in New York, is one such business owner opting out of early orders due to these overheads.
Some companies, like Denver-based Oaktree Memorials, are adopting a “wait-and-see” approach. Co-founder Max Lemper-Tabatsky explained that they prefer to hold off on major investments until there’s clarity on the policy.
Alan Baer, president of OL USA, a freight forwarding company, anticipates that some form of Trump’s tariff plan will go through, noting that tariffs in shipping generally reduce business volume and workforce demand.
