Last week we explored the effects of the war overseas on small businesses, and now we’re diving deeper into tariffs. Tariffs might seem like something that only affects global trade or big corporations but for small retailers, their impact can be immediate, personal, and costly. From rising prices on everyday inventory to strained supplier relationships, small businesses are often hit the hardest and helped the least when tariffs shift.
With tariff talk back in the headlines, now’s the time to break down what tariffs really mean for independent store owners, and what you can do to stay ahead.
At their core, tariffs are taxes on imported goods. The idea is to make foreign products more expensive, which in theory should encourage people to buy domestic alternatives. But here’s the problem: many everyday products from canned goods to cleaning supplies rely on global supply chains. Even if something is made in the U.S., parts or packaging might come from abroad. That means small retailers can still feel the squeeze.
In fact, according to the U.S. Chamber of Commerce, tariffs can increase the cost of goods sold by 10% to 25%, depending on the product. For a big-box chain, that might be manageable. For a small neighborhood shop? That extra cost cuts deep.
Across the country, small business owners are already dealing with the fallout. A BuzzFeed feature highlighted one café owner who had to raise menu prices three times in six months due to rising costs on imported coffee and kitchen supplies. Others shared stories of having to pause expansion plans or let go of staff to keep up with inflated inventory costs.
In the grocery and convenience sector, the situation is even more stark. Tariffs on steel and aluminum have pushed up the cost of canned goods, beverage packaging, and refrigeration units. As Marketplace recently reported, even modest tariffs can ripple across the supply chain, eventually driving up prices on everyday staples like soup, soda, and beans.
And the impact isn’t just economic, it’s emotional. As one business owner told NerdWallet, “We’ve done everything we can to stay lean. But now we’re stuck between rising costs and customers who already feel stretched thin.”
When small retailers struggle, entire communities feel it. Local shops often operate on thin margins. Tariff-related price hikes don’t just threaten profits, they can mean fewer hours for staff, less money reinvested locally, and, in some cases, closures.
The National League of Cities recently gathered feedback from local leaders across the country. Their takeaway? Tariffs are more than a trade issue, they’re a local economic threat, especially in underserved neighborhoods that rely heavily on independent retailers.
It's clear that tariffs are complex and often beyond your control, but your response to them doesn’t have to be. Whether you run a small grocery store, convenience shop, or specialty market, there are practical steps you can take to protect your margins and keep your shelves stocked without passing the full burden onto your customers.
1. Start with a focused inventory audit.
Take stock of the products you carry that could be affected by tariffs, especially those that are imported or rely on foreign materials like steel, aluminum, or plastic. Use past sales data to evaluate which items are essential to your business, and which can be replaced or phased out.
2. Open the conversation with your suppliers.
Reach out to your distributors and vendors. Ask them directly which products are being affected by tariffs, what price increases they anticipate, and whether there are alternatives available such as domestic brands or bulk discounts. In some cases, you may be able to lock in pricing or negotiate more favorable terms by committing to longer-term contracts or larger orders. The more proactive you are, the more options you’ll have when prices start to shift.
3. Adjust your pricing strategy with care.
While no store owner wants to raise prices, it may be necessary to stay afloat. Start by evaluating your top-selling items and determine whether they’re still profitable under current costs. If changes are needed, introduce them incrementally, even a 10–25 cent increase can help protect your margins. Consider bundling products, introducing multi-buy discounts, or implementing loyalty programs to offer added value alongside any price changes.
4. Look for domestic and local alternatives.
One of the most effective ways to minimize tariff exposure is to source products that aren’t affected by tariffs in the first place. Explore U.S.-made goods or items from regional suppliers. Not only can this reduce costs, but it also supports the local economy and can become part of your brand story! Don’t be afraid to promote these items with signage, shelf talkers, or posts on social media, customers often appreciate knowing where their products come from.
5. Collaborate with other local business owners.
Chances are, your neighbors are facing similar challenges. Consider partnering with other small retailers in your area to place joint orders, share supplier insights, or even split delivery costs. Bulk buying can unlock better pricing, and networking may reveal new supplier options you hadn’t considered. Even informal conversations can help you spot trends or prepare for supply disruptions before they reach your store.
6. Use your data to stay nimble.
What sets resilient retailers apart is their ability to adapt quickly. Use your sales data to make smarter ordering decisions, especially around products that have long lead times or volatile pricing. Avoid overstocking items that may be at risk, and keep a close eye on category-level trends. Don’t have any tools to do that? Zaiko’s platform can help you spot shifts in real time, so you can reorder with confidence and reduce waste or excess inventory.
7. Keep your customers in the loop.
If prices increase, let your customers know why and thank them for their continued support. A small sign at the register or a short note on your website or social media page goes a long way in building transparency. People are more understanding than we sometimes give them credit for, especially when they know you're doing your best to navigate challenges that are largely out of your hands.
We know navigating tariffs can feel overwhelming. But you’re not powerless. The strategies above are real, practical ways to protect your margins, support your community, and make smarter decisions in uncertain times.
And if you don’t have the data, tools, or time to do it all yourself, don’t worry. That’s exactly where Zaiko can help. We built a product to make things easier: give you clear, real-time insights into your inventory and costs so you can stay focused on what matters most, running your store and serving your customers. You’re not alone in this. And you don’t have to figure it all out by yourself. Book a demo today or give us a call!
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Answers to popular questions you might have about Zaiko.
Zaiko helps retailers increase profits by automating data entry for Direct Store Delivery (DSD) invoices. Our AI technology reduces errors, eliminates manual labor, and ensures real-time accuracy, allowing you to cut costs and uncover savings. It integrates with existing ERP, POS, and inventory management systems to enhance operational efficiency and boost profit!
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Definitely! Zaiko is designed with a user-friendly interface that makes it easy for both technical and non-technical users. The platform allows you to upload invoices, manage inventory, and view insights without needing specialized technical knowledge.
