With the 25% Chinese tariffs on the horizon, the anticipated outlook could have a large effect on small businesses that import or manufacture much of their product from China. Larger companies will still be affected, clearly, but with a much greater portfolio size come significantly less repercussions. Many small businesses today rely solely on Chinese exports. One disadvantage for smaller businesses is that it's very difficult to shift product sourcing to another country due to their limited resources available. Another complication is if their product were to suddenly cost them 25% more eating those costs are much harder for smaller businesses than larger ones. Raising prices for many of these smaller businesses may be out of the question as well. If you have to raise your prices by 25% it may push you well out of the range for what consumers are willing to pay.
https://www.cnn.com/2019/09/04/success/small-business-china-us-trade-war/index.html
Small businesses will take a large hit due to these tariffs. I could see many of them going out of business due to the inability to absorb the rising costs to produce goods.
ReplyDeleteThe trade war has been incredibly costly to small businesses. Their production costs have soared and they don't have the capital to deal with that. Many are struggling and will continue to struggle until the trade war ends.
ReplyDeleteThe affect of the tariffs on the larger companies just haven't been felt yet. They take longer to feel effects of economic policies like these and are still reaping the benefits of the massive corporate tax cuts. Just a matter of time.
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