China-Zölle decrease from 145%: Small companies continue to suffer

President Donald Trump's decision to introduce a high tax on most goods that are imported into the United States has the steadfastness of SME-Ink, whose companies on global retailers are dependent on the test. The unpredictable effects of Trump's customs policy not only put a strain on the patience of the entrepreneurs, but also threaten the existence of their companies.

customs reduction between the USA and China

The latest, possibly great turn came last week when the USA and China agreed to reduce their customs tariffs drastically . The de-escalation reduced the US tariffs to Chinese goods from 145 % to 30 %. The markets were happy about this message , and the economic forecasts Linden .

This would have to be happy for small entrepreneurs who are confronted with high customs costs - including Beth Fynbo Benike, the founder of Busy Baby, whose next delivery of baby products with additional costs of $ 230,000

fynbo Benike answered this question with a mixture of cutting sarcasm and a dash of reality. "The tariffs were reduced. 30 %. Yay!" she said in a recently published TikTok video. "This is still bad to be honest. For every small business owner ... I will still cost me $ 48,000 more than this delivery would have cost two months ago."

"It's still terrible," she added.

The challenges for small companies

Fynbo Benike has now become a symbol for small entrepreneurs who are in the crossfire of a turbulent trade regime. The Launische Nature of Trumps Handelspolitik and the severity of the newly imposed tariffs have caused significant damage in the USA. The costs rose quickly, long-term supply chains are destabilized, growth and expansion plans are severely affected, and this threatens the existence of American companies.

Elizabeth Renter, Senior Economist at Nerdwallet, commented in an interview with CNN: "A 30 % inch on Chinese imports is still an increase, and that is not the only customs that we look at. The relief was not necessary, but let us deceive ourselves. The effects of this trade war will be significant, and I think that it will be hard to meet."

To understand the dilemma of small business, a look at the largest group in the world is enough. The CEO von Walmart only admitted last week that the tariffs were "too high" to absorb them as the largest retailer in the world, and that The prices in the coming weeks I have to rise .

Renter said: "Walmart is best prepared to deal with rising costs; you probably have one of the most complex supply chains, and you move into your products from several suppliers. If even Walmart signals that you have to increase prices, we know that the pressure on smaller companies will be considerable."

Francine Farkas Sears, who was the first American businesswoman 50 years ago, after President Richard Nixon opened the trade relationships with China, told CNN that the tariffs were producing the liability of its company, professional bags for women and accessories for the girl Scouts of America and the Red Cross.

"Well, we could just as well reconcile a lunch date, because I will no longer have a business; it is so serious," she said, adding that the increasing tariffs endanger decades of relationships and make your company unsustainable.

adaptation and planning of alternatives

Fynbo Benike, a US Army veteran, has long tried to produce the baby play mats and other accessories in Germany; However, the infrastructures in the USA remain costly, limited or in some cases. Therefore, she was dependent on imported goods and materials to expand her business.

Busy Baby was on growth course: The company brought its products to several hundred Walmart and Target branches and Fynbo Benike had just paid their biggest order to fill up the inventory for their website and Amazon.

Busy Baby has adapted his strategy in the past few weeks. The company developed an international sales plan in which the majority of sales outside the USA should be achieved.

The customs reduction with China means that Fynbo Benike can now initiate delivery to the USA. But this will result in high costs - most funds to cover the expected $ 48,000 import tax come from a gofundme.

"Now that the tariffs were reduced, it is sufficient to close the gap; we will send the product as soon as possible," explained Fynbo Benike. "And then - this is risky - we will start producing our next line. I hope it won't get worse."

The situation remains volatile, and Fynbo Benike is already planning to modify their baby play mats according to EU standards.

"I would say it is getting more and more insecure and stronger," she said. "The last time the tariffs rise and now they suddenly fall strongly. They say it is for 90 days, but will it really be 90 days?"

"The current administration is known to make sudden and drastic changes without warning, and now that happens in both directions," she added.

survival in uncertainty

Last month a milestone for Katharine Burke's company should be purryful, a startup that produces calming cuddly toys for stressed millennials and gen z. After two years of development, the first production line should start in April.

April was "not entertaining," said Burke. "The existence of my company was questioned throughout April," she said by email. "I had my first, second and third panic attacks. I tried to develop backup plans because the tariffs had a dramatic effect on my annual forecast."

The Purryful products were produced in the first week of May and should be sent from China at the end of the month. At that time, the tariffs were still 145 %, and Burke did not know whether it would be in trouble or not.

A week later, the tariffs fell to 30 %, a significant relief for small companies like theirs. But "it is able to survive," she said.

Nonetheless, there were problems here too. Your customs agent still rolls the hundreds and thousands of customs codes to calculate the exact import fee that Purryfuls has to pay. In addition, there are new risks not only due to higher shipping costs, but also through possible delays when ordering.

"Now that the tariffs were reduced, all programs suddenly go out, which could build up the sea frequency traffic and drive up the prices," she wrote. "I hear from my manufacturer that canceled orders are revived, which is great for them, but the deficit could mean that there is no place for me to place another order while everyone hurts to be ready for Christmas."