Key Takeaways
- US-China tariffs are squeezing small businesses by creating immense financial pressure on small businesses importing from China.
- Tariffs up to 145% left some business owners blindsided with unexpected customs bills.
- Low-margin companies are nevertheless greatly impacted by temporary tariff reductions of 30%.
- Business owners are scrambling for alternatives, including foreign trade zones and bonded warehouses.
- The unpredictability of US–China trade relations has led to market instability and profit uncertainty.
The Tariff Tug-of-War: How US–China Trade Policy Is Crippling American Importers
When Bobby Djavaheri walks through his Los Angeles warehouse filled with neatly stacked air fryers and rice cookers, he doesn’t just see products—he sees financial risk. As the owner of , a company specializing in small kitchen appliances manufactured in China, Djavaheri is on the front lines of a trade war that’s threatening to destroy everything he built.
Just weeks ago, he was blindsided by a staggering 145% tariff slapped on his latest shipment of goods. The duties—ranging from $9,000 to $21,000 per container—came without warning, turning his modest customs fees of a few hundred dollars into a budget-breaking burden.
Djavaheri told CBS News that he was finding himself in a position where he felt his government was not supporting him or his cause, describing it as a very weird and strange feeling.His story is not unique.
Small Businesses, Big Problems
The US-China tariffs have placed small business owners in an impossible bind. Most operate on razor-thin margins and can’t absorb a triple-digit tariff increase overnight. For entrepreneurs like Djavaheri, these unexpected costs don’t just threaten profits—they jeopardize survival.
Before the tariff spike, Djavaheri’s imports were sustainable. But with duties skyrocketing, the cost of doing business has become unbearable. Even after a temporary truce reduced tariffs to 30% for 90 days, the reprieve is far from comforting.
“We’ve increased prices on everything,” Djavaheri said. “Shipping prices have already tripled.”
And with the holiday shopping season fast approaching, the pressure to stock inventory now—despite volatile trade policies—has added a new layer of urgency.
The Cost of Uncertainty
Tariff unpredictability has made long-term planning nearly impossible for importers. One week, you’re paying 145%. The next, you’re paying 30%—but only temporarily. Nobody knows what will happen after ninety days.
For small businesses, this volatility creates financial whiplash. Djavaheri, who rushed to pay the higher duties to avoid missing delivery deadlines, now finds himself out thousands of dollars he will never recover.
“This is a war that we are in the middle of,” he lamented.
Bonded Warehouses and Trade Zones: A Temporary Escape
Faced with this uncertainty, some companies are turning to foreign trade zones and bonded warehouses to buy time. These facilities—located near ports and airports—offer businesses a way to defer paying tariffs until they actually move goods out for sale.
Ryan Petersen, CEO of logistics firm Flexport, said that demand for these facilities was surging. He explained that the duties represented a significant outlay of cash for businesses, and many preferred to leave their goods in storage until the last possible moment when they actually needed them.
This strategy, while useful, is only a stopgap solution. Storage costs add up, and with shipping prices already tripling, few small businesses can afford long-term warehousing.
A Fragile Supply Chain Faces Even More Pressure
The bigger issue here is supply chain fragility. Many American small businesses rely heavily on Chinese manufacturing for cost-efficiency and scalability. The trade war has laid bare how vulnerable this dependence makes them.
A sudden spike in tariffs doesn’t just impact the current inventory—it disrupts supplier relationships, delivery schedules, and cash flow forecasts. And while large corporations may have the capital to pivot or absorb the impact, small businesses don’t have that luxury.
Can Reshoring Be the Answer?
Some argue that US companies should consider reshoring—bringing manufacturing back to America or sourcing from less volatile countries. Although this might be feasible in theory, it isn’t necessarily feasible.
For products like air fryers and rice cookers, manufacturing infrastructure, expertise, and economies of scale are deeply entrenched in China. Moving production would mean not only higher costs but also longer lead times and potential quality control issues.
Moreover, small businesses often lack the bargaining power or volume to strike favorable deals with new suppliers overseas.
What Needs to Change?
At the heart of this issue is a need for predictable trade policy. Businesses can adapt to high tariffs if they’re stable and long-term. What they can’t handle is policy whiplash—when trade terms change mid-season or mid-shipment.
For entrepreneurs like Djavaheri, all they ask for is consistency. That, and a government that understands their challenges.
He said that people needed to understand that operating a very low-margin business made it almost impossible to continue doing business.
If tariff policy continues to fluctuate without clear direction, more small businesses may find themselves priced out of the market entirely.
The Human Cost Behind the Headlines
Behind every policy headline is a business owner scrambling to make payroll, honor customer commitments, and survive. The trade war isn’t just an economic dispute between nations—it’s a series of personal crises playing out in warehouses and boardrooms across the country.
It is up to policymakers to decide if tariffs are the best geopolitical instrument. But their real-world consequences are being felt daily by those with the least room for error.
Conclusion
The US-China tariffs have become a high-stakes game of survival for small American importers. Entrepreneurs like Bobby Djavaheri aren’t just watching their profit margins disappear—they’re watching their dreams unravel under the weight of policy decisions they can’t control. Until trade relations stabilize and clear, long-term strategies are established, many of these businesses will remain in limbo—struggling not to grow, but simply to survive.
