NEW YORK (AP) — Small businesses contending with higher tariffs on Chinese imports must determine the best way to mitigate the damage to their profits after the duties rose to 25% from 10% last Friday. Some of the alternatives and considerations owners should look at:
- Move manufacturing to another country. Vietnam, Singapore and Bangladesh are among the countries that have growing manufacturing industries and aren't engaged in a trade dispute with the U.S.. But smaller companies may not be able to afford the tens or hundreds of thousands of dollars to move manufacturing. It's also a lengthy process to get started with a new manufacturer — and if there's a trade agreement with China, it may be tempting to move production back.
- Look for U.S. suppliers. In some industries, there are few or no U.S. manufacturers — all the domestic production has gone overseas. Even where there are U.S. companies, they may have raised their prices because they could charge more while still being competitive with Chinese imports that are being taxed by the U.S. government.
- Pass along higher costs to customers. Business owners have to consider their competition; if other companies aren't raising prices, they stand to take business away from those that do. But some owners find that customers understand the situation and will pay the added costs.