News Summary

Small businesses in Southern California are facing significant challenges due to tariffs imposed by the Trump administration. Owners like Jack Carlisle from The Potting Shed are re-evaluating inventory and vendor relationships to mitigate costs. The tariffs are anticipated to decrease U.S. imports and impact various sectors, including aerospace manufacturing. As these businesses navigate a complex economic climate, some are finding innovative strategies to adapt and survive in a landscape marked by uncertainty and rising prices.

California – Small business owners in Southern California, like Jack Carlisle, who owns The Potting Shed in Orange, are adapting their strategies in response to the tariffs imposed by the Trump administration. The tariffs, which took effect on April 2, are significantly affecting how local businesses source their products and manage costs, as they anticipate a challenging economic climate ahead.

The Potting Shed, located in Orange’s historic downtown plaza adjacent to Chapman University, spans 8,000 square feet and offers a variety of items including plants, pots, soil, candles, and other houseware products. The business generates over $1 million in annual sales, but the impact of the tariffs has prompted Carlisle to reassess his inventory choices carefully and rely more on established vendor relationships to keep costs manageable.

One notable vendor in this strategy is a Canadian ceramic pot maker who is storing inventory at pre-tariff prices in San Diego, helping to alleviate some of the financial strain caused by the new import taxes. The tariffs have evoked memories of the COVID-19 lockdown era, which saw a surge in gardening and home improvement interests among consumers.

The National Retail Federation has projected that U.S. imports could potentially drop by at least 20% in the latter half of 2025 if the tariffs remain in place, highlighting the far-reaching effects on trade and commerce. As a result, the ports of Long Beach and Los Angeles are bracing for reduced cargo volumes, particularly from China, where tariffs can be as high as 145%. This decline in import activity is affecting various sectors, including small aerospace manufacturers who rely on affordable materials such as aluminum extrusions and aircraft components.

A significant number of smaller manufacturers are grappling with soaring costs resulting from the tariffs, leading to drastic measures. For example, Aura Seating, a manufacturer based in Torrance, has been forced to lay off half of its workforce due to the heightened expenses associated with tariffs on Chinese components. Similarly, Independent Forge Co. in Orange, which produces parts for Boeing aircraft, is witnessing diminished overseas activity as tariffs and supply chain issues continue to create challenges.

In contrast, some manufacturers like Lily Jack, a furniture producer, are managing to sidestep tariffs due to compliance with the United States-Mexico-Canada Agreement (USMCA). This has allowed them to maintain a more stable pricing structure while other businesses face increased volatility. Experts believe that the current tariff situation is encouraging small businesses to explore innovative methods and alternative strategies for cost mitigation while simultaneously re-evaluating their sourcing of foreign-made products.

The hesitation caused by the tariffs among larger vendors can also be expected to trickle down to smaller suppliers, affecting order volumes and business relationships. Moreover, consumers are likely to see prices for a range of goods, including electronics and furniture, rise in response to the increasing import tariffs.

Supporters of the tariffs argue that these measures will ultimately strengthen the U.S. economy, despite the short-term pain associated with price increases. On the other hand, critics caution that the tariffs may lead to inflationary pressures and worsen economic certainty for both consumers and businesses, as uncertainty in international trade continues to loom large.

As Southern California small business owners navigate these complex and evolving challenges, the landscape remains uncertain. Continuing to adapt and innovate will be crucial for their survival and success in a rapidly changing economic environment.