An easing in President Trump’s tariffs on Chinese goods gave businesses some breathing room. Long-term planning, though, is still on pause.
President Trump lowered his tariffs on China, and Wall Street breathed a sigh of relief. But for many businesses, especially small ones, 30 percent is still a crippling burden.
The 145 percent tariff on Chinese goods that was in place for nearly a month was unthinkably high for businesses large and small. But even at the current levels, the overall average tariff rate on imports to the United States remains at its highest level since 1934, according to a report from the Yale Budget Lab released on Monday. Even Walmart, the largest retailer in the United States, said on Thursday that it would have to raise prices on some items in response to tariff-fueled cost increases.
And tariffs could rise again if the two countries do not reach a deal within 90 days.
The 90-day pause “may temporarily help unstick the effective trade embargo that has been in place,” Steve Lamar, the chief executive of the American Apparel and Footwear Association, said in a statement. But, he added, the 30 percent tax will still cause prices to soar during the back-to-school and holiday seasons later this year.
“What’s needed now is a long-term deal — not just with China but with all our trading partners — so we can predictably make long-term trade, investment and sourcing decisions,” Mr. Lamar said.
Unlike large retailers, which can absorb some of the cost of tariffs and have the heft to pressure suppliers, smaller companies that rely on imports from China tend to have minimal leverage to negotiate with their Chinese suppliers — and relatively tight margins. We talked to four business owners about the strategies they are trying as tariffs cut into their bottom line.
Marina Rosin Levine is the chief executive of Highline United, a footwear company near Boston, which makes roughly half of its items in China. This week, she visited her supply chain headquarters in the Chinese city of Dongguan, where conversations centered on a key question: Which shoes can it afford to sell in the United States?
