Tariffs For Dummies
Tariffs might sound good on the surface—after all, they tax foreign goods, which seems like it would help domestic businesses. But in reality, they often do more harm than good for the U.S. economy. Here’s why:
1. Tariffs Raise Prices for Consumers
When tariffs are placed on imported goods, foreign companies don’t just eat the cost—they pass it on to American consumers. That means higher prices for everything from cars to groceries to electronics. The average American ends up paying more for everyday goods.
2. They Hurt American Businesses That Rely on Imports
Many U.S. businesses depend on imported materials to manufacture their products. If tariffs increase the cost of raw materials like steel, aluminum, or microchips, companies either have to raise their prices (hurting sales) or absorb the cost (cutting into profits). This weakens industries instead of strengthening them.
3. They Lead to Retaliation from Other Countries
When the U.S. imposes tariffs, other countries don’t just sit back—they respond with their own tariffs on American exports. This hurts American farmers, manufacturers, and other industries that rely on selling goods overseas. We’ve seen this happen before, where tariffs led to trade wars that devastated certain sectors of the economy.
4. They Don’t Actually Bring Jobs Back
The idea that tariffs bring back American manufacturing jobs is mostly a myth. Companies don’t just shift production back to the U.S.—they look for cheaper options elsewhere, like Vietnam or Mexico. Meanwhile, industries that rely on exports (like agriculture and tech) suffer due to retaliatory tariffs.
5. The U.S. Already Has Trade Advantages
We already have one of the strongest economies in the world, with a competitive edge in innovation, finance, and services. Protectionist policies like tariffs often end up isolating us rather than making us stronger.
So Why Didn’t We Have Tariffs Already?
Because historically, free trade has led to economic growth, innovation, and lower prices for consumers. Tariffs may sound patriotic, but they often backfire, making goods more expensive, hurting businesses, and leading to unnecessary trade conflicts.
Tariffs are like slapping a band-aid on a problem that requires surgery—they don’t fix the real issues, and they often make things worse.
If you think about it… We’ve done this mass tariff thing before…1828, 1930, and now 2025.
1. The Tariff of 1828 ("Tariff of Abominations")
This was designed to protect American industry, but it had severe unintended consequences.
The South, which relied on imports and exports, suffered heavily, leading to economic strain.
It fueled tensions between the North and South, contributing to the growing divide that eventually led to the Civil War.
2. The Smoot-Hawley Tariff of 1930 (A Key Factor in the Great Depression)
This was meant to protect American farmers and manufacturers by imposing high tariffs on imports.
Instead, it triggered global retaliation, with other countries placing tariffs on American exports.
International trade collapsed, worsening the Great Depression.
Economists almost universally agree that it made the depression deeper and longer.
3. and now The 2025 Tariffs (If They Follow the Same Pattern…)
If history repeats itself, large-scale tariffs could again lead to economic downturn.
Global supply chains are even more interconnected now, meaning retaliation could be swift and severe.
Higher prices for consumers, damaged export markets, and economic instability could follow.
The Pattern is Clear
Every time the U.S. has implemented widespread tariffs, it has led to economic hardship. The lesson? Protectionism sounds good in theory but has historically led to disaster when applied on a mass scale.
what do the 2025 tariffs mean for actual small business and entrepreneurs today?
small businesses and entrepreneurs always feel the pain first and the longest when big economic policies like tariffs roll out. Here's what the 2025 tariffs could mean for real people trying to build and grow businesses right now:
Higher Costs Across the Board
If your business buys anything imported—or relies on products made with imported parts (think: packaging, equipment, materials)—your costs will rise.
And no, it’s not just tech or big corporations. That includes:
Boutique shops buying inventory from overseas (e.g. clothing, accessories, home goods)
Service businesses using imported tools or skincare devices
Product-based entrepreneurs sourcing ingredients, components, or packaging from global suppliers
Unless you're producing 100% domestically (which is rare and often more expensive), you’re getting hit.
Supply Chain Disruptions
Tariffs shake up supply chains. Suppliers may increase prices, delay shipments, or go out of business. For small businesses who don’t have the leverage to negotiate contracts or find alternate vendors quickly, this can cause major delivery delays or product shortages. That’s a killer during launches or peak seasons.
Lower Consumer Spending
Tariffs drive up costs → inflation rises → consumer wallets tighten.
That means:
Slower sales for service providers and product-based businesses
More price resistance from your audience
Less spending on “non-essentials” like coaching, wellness, gifts, or custom experiences
Basically: your dream customer is also struggling with rising costs.
More Barriers to Growth
Entrepreneurs already face hurdles—capital, time, marketing, competition. Tariffs just pile on more:
Higher startup costs
Increased pricing pressure from customers
Less ability to scale or reinvest
Risk of getting undercut by bigger companies with more resources
Forced Repositioning or Pivoting
You may need to:
Raise your prices (and risk losing customers)
Switch suppliers (which takes time and testing)
Rethink your product model or services
Absorb costs and sacrifice profit margin
None of that is impossible—but it’s hard, and it’s distracting from actual growth.
Mass tariffs don’t protect small business—they stress it.
They were designed for industrial age economies, not the diverse, interconnected, creative entrepreneur-led businesses we have today.
Instead of leveling the playing field, they tilt it in favor of those who already have the resources, the capital, and the domestic infrastructure to ride the wave. Most small business owners don’t.
Tariffs don’t just tax foreign companies—they tax your business’s potential.
They squeeze margins, slow momentum, and make it harder for small players to compete. So if you’re a small biz owner or entrepreneur, the 2025 tariffs aren’t just some abstract economic move—they’re a direct hit to your bottom line, creativity, and customer experience.
let’s get you prepped like the resilient, badass business owner you are. 💪
Here’s your Tariff-Era Survival Checklist for Small Biz + Entrepreneurs (2025 Edition):
1. Audit Your Supply Chain
Make a list of every product, part, or material you use that might be imported.
Ask your suppliers: Are your costs expected to increase? Will lead times change?
Identify any single points of failure—places where you're overly reliant on one vendor or product.
Business Bestie Tip: If you’re reselling goods, check where they’re actually made. "Distributed in the U.S." ≠ Made in the U.S.
2. Reevaluate Your Pricing Strategy
Run the numbers: How much wiggle room do you have to absorb extra costs?
Consider tiered pricing, value bundles, or a small price increase with strong messaging.
Emphasize VALUE in your marketing—not just price.
Messaging Example: “We’re still keeping our quality high and our pricing honest—even as our costs rise behind the scenes.”
3. Source Smarter
Start researching alternate suppliers (domestic and international) NOW, not when it’s urgent.
Reach out to your top 2-3 vendors and ask for contingency plans or volume discounts.
Get creative: Could you switch materials, use digital products, or offer services instead?
For Product-Based Biz: Consider lower-inventory models, limited drops, or pre-orders to reduce waste and risk.
4. Talk to Your Audience
Be transparent—without doom-and-gloom. Share behind-the-scenes challenges.
Build loyalty by letting people in on your journey.
Position any pivots as part of your evolution, not a setback.
Example: “We’re tweaking things to make sure we can still serve you with the same quality you love, no matter what chaos the economy throws at us.”
5. Strengthen What You Can Control
Nail down your brand message & marketing funnel
Focus on retention and community building (loyal customers > cold leads)
Tighten up systems to reduce time, waste, and stress
6. Diversify Your Revenue (Yes, Even Just a Bit)
Can you:
Add a digital product?
Offer a low-cost/high-margin service?
Host a paid workshop or masterclass?
Don’t go into hustle mode—but create options so you’re not too dependent on one stream.
Example: Product biz? Add a paid skincare or style guide. Service biz? Add an evergreen mini course or VIP day.
7. Watch Policy Changes Closely
Follow updates from your industry groups or local chamber of commerce.
Stay on newsletters from suppliers and trade advisors.
Be ready to adapt if tariffs shift again—because they might.
Remember:
You’ve Already Done Hard Things
If you built your business during COVID, a recession, or even just the chaos of the last few years… you’ve got grit. This is just another curveball—and you’re smart enough to pivot and profit.