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How are businesses that import from China handling the trade war?

 The latest 90-day pause on higher tariffs are causing more stress than relief for some business owners.

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Tariff uncertainty caused Matthew Hassett, founder of Loftie, to stop ordering new inventory for U.S. customers and focus on other markets.
Tariff uncertainty caused Matthew Hassett, founder of Loftie, to stop ordering new inventory for U.S. customers and focus on other markets.
Allen J. Schaben/Los Angeles Times via Getty Images

Another day, another change in tariffs. President Donald Trump announced Monday night that he is extending the pause on higher tariffs on China for another 90 days, until mid-November. 

Tariffs on Chinese imports are currently set at 30%, which, to be clear, is high. But Trump has threatened tariffs of up to 245%.

Retailers who do import from China know 90 days is nothing when you’re ordering goods from overseas.

“It's probably not going to be even produced in 90 days. Let alone shipped. Let alone come through the port, which is where the tariff is assessed,” said Barton O’Brien.

He owns BAYDOG, a retailer based in Maryland that sells adventure gear for dogs — things like dog lifejackets. He imports all of his goods from China, India, and Vietnam.

“We have not had to pay a nickel in tariffs yet, but that's only because we started planning for this over a year ago,” he said.

As soon as Trump started talking about tariffs on the campaign trail, O’Brien ordered a bunch of extra inventory. But, he said, it’s starting to run out.

“And so our factories are working on orders that they're going to be shipping this fall right now. I just don't know how much I'm going to have to pay for it,” he said.

In Suwanee, Georgia, Aaron Brown said tariffs are already affecting almost every aspect of his business. He owns a shop called Town Center Music, where he sells instruments.

“All of the uncertainty has seemed to cause, like, COVID-style shipping disruptions. It's just been really, really hard to source products,” Brown said.

And a lot of what he can get is more expensive.

“Some brands that I sell, I've done up to three price hikes in the last three months. It's been, it's been rough,” he said.

It’s also been rough for Matthew Hassett, founder of Loftie, a company that sells alarm clocks and sleep accessories.

“If we knew what the tariffs were going to be globally, we could make rational decisions,” he said.

Like whether to shift production from China, where tariffs are 30%, or to Thailand, where they’re 19%, but labor costs are higher.

If Hassett knew tariffs were going to stay the same, he would keep production in China. But will they?

“Right now, I have no idea, and no one has any idea,” he said. So he’s decided to stop ordering new inventory to sell in the U.S.

“It just is too dangerous to do business here as a small company,” he said. “I am working to ramp up our sales in Canada, in the EU, in the U.K., in Japan.”

Places where he knows what his costs will be. 

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