An article by an owner of a small business on the R / Smallbusiness of Reddit basement gained ground, capturing panic and confusion spreading through the community while new prices on Chinese imports are starting to take effect.
The user, Fullrendypro, warned his entrepreneurs’ colleagues: “Next month, your $ 20 product in China could cost you $ 50 before he even reaches your warehouse. What is your plan? “
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The referenced rates are part of the president Donald Trump New trade policy, which includes a 145% rate rate on many Chinese products. These prices have already started to have an impact on certain categories and will increase considerably on May 2, when the United States eliminates the minimis exemption for imports of less than $ 800. This exemption previously enabled many small expeditions of China to enter the United States without tasks.
“Even packages of less than $ 800 will face a rate of 120% more than $ 100 at $ 200 per item depending on its arrival,” said Fullrendypro. “So your $ 20 product?” It could cost more than $ 100 before it even reaches your warehouse. ”
The responses to the post quickly sank and they shared a common tone: stress, uncertainty and financial tension.
“I spoke directly with the manufacturers to design products,” said a user. “But even then, I used low (minimal quantities of control). The inventory costs are going to be crazy. As I heard about all this, I decided to close. I am dissolving.”
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A tea store owner who imports teas from China added: “Where are many specialized teas?” China. Seven years of incredibly hard work in hell. I fear. I started optimistic three weeks ago. Not now.”
For companies with more infrastructure, the consequences are no less disastrous. A business owner employing more than 200 people said: “We have stopped all the expeditions of China. The containers will accumulate in our factories … We have a few weeks before layoffs and content begins. Sh * t will arrive in real life if it is not resolved within 30 days. ”
Some companies are trying to adapt. Options on the table include the displacement of supply chains to countries such as Vietnam, Cambodia and Mexico, or supply to national suppliers despite higher costs. Others undertake an inventory abroad, hold expeditions or try creative solutions to avoid direct trade in China and the United States.
“It is definitely a punch for anyone who counts on China, in particular for products with low margin. We are already moving to Mexico and certain parts of Southeast Asia,” said a commentator. “The costs are slightly higher than Pre-Tarif China, but much more stable now.”
But even alternative supply is not a guarantee. “If you hit a bad window with regard to the port when the prices are at a record level, then the week after their return to 25%, that’s the problem,” noted a business owner.
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Many commentators have stressed that they are not only cheap gadgets from Temu or Shein. “These are not only the sellers of Aliexpress. They are marks, factories and massive staff with nowhere to rotate fairly quickly,” wrote Fullrendypro.
Others have echoed that. “The Temus and Sheins and Garbage brands on Amazon should be stopped,” said a user. “They actually create an unfavorable commercial situation.”
When someone joked to “get used to living on a bowl of rice per week,” joked another, “the United States produces something like 1% of rice in the world, so perhaps another food”, stressing how the United States remains dependent on foreign products.
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Most commentators have agreed that cost transmission for consumers is inevitable, although risky. “Transmitting it to customers once my suppliers increase their prices, identical to coated times,” wrote one of them. “Sales will probably suffer significantly.”
Others maintain the hope of a reversal of politics, but little bet. “Place an order in China right now is literally a white check that you do not know how on the hook,” published a frustrated user.
Consensus? It’s a mess. And without transparent and stable trade policies, it is small businesses that could be the first to pass.
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This article from a small business owner asks: “What is your plan”, now that a $ 20 product in China costs $ 50 before it even reaches the warehouse? Initially appeared on benzinga.com
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