Rising Costs and Quiet Adjustments: Small Businesses Weigh the Impact of Tariffs

Strategic Insights -

As the national conversation around tariffs intensifies, small business owners are feeling the strain of rising costs, supply chain disruptions, and tough pricing decisions. Despite their concerns, many are adapting quietly, with 58% raising prices and 29% absorbing the costs themselves. However, with 51% saying they can only do so for 12 months or less, the challenge of managing the consequences of tariffs remains a pressing issue.

Key Takeaways:

  • 42% of small business owners say recent or proposed tariff policies have directly impacted their business, with 41% citing rising product and material costs and 24% citing supply chain disruptions.
  • 47% of small business owners have made or are planning changes in response to tariffs, with 58% raising prices and 21% considering shifting operations back to the U.S.
  • Only 18% of small business owners pass on tariff-related costs to customers, while 47% pass on costs partially or fully, and 29% absorb the costs entirely.
  • 51% of small business owners can only absorb the impact of tariffs for 12 months or less, while 26% have high confidence in the U.S. government's handling of trade policy.
  • 35% of small business owners say tariffs put them at a competitive disadvantage, while 21% believe they offer an edge, and 36% expect tariffs to negatively impact their business over the next year.

Statistics:

  • 42% of small business owners report that tariffs have directly impacted their business.
  • 41% of small business owners cite rising product and material costs as a direct impact of tariffs.
  • 24% of small business owners report supply chain disruptions as a direct impact of tariffs.
  • 58% of small business owners have raised prices in response to tariffs.
  • 29% of small business owners absorb the costs of tariffs entirely.
  • 51% of small business owners can only absorb the impact of tariffs for 12 months or less.
  • 26% of small business owners have high confidence in the U.S. government's handling of trade policy.

Sources:

  • Savanta Group LLC

+ Survey conducted by Savanta, sample size of n=1,000 U.S. adults aged 18+, margin of error +/- 3% per 1,000 completes.

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