As the U.S.-China tariff war escalates, questions are mounting for small business owners, especially those in the toy industry.
Will prices increase? Could shelves go bare during the holiday season?
Lesa Smith, owner of Whiz Kids toy store in San Luis Obispo, says the situation is already having an effect.
“So no one wins in a tariff war, especially small retailers,” Smith said. “The losers in a tariff war like this are always small business. It can only hurt us, can't help us.”
Whiz Kids sources many of its products from small manufacturers who are also feeling the squeeze. According to Smith, some vendors, even those the store has worked with for nearly four decades, are worried about how they will afford tariffs when retrieving products at U.S. ports.
“They have to pay them to get their products out,” she said.
In preparation for looming price hikes, Smith said the shop is ordering inventory early, but like many small businesses, Whiz Kids doesn’t have the cash flow to fully stock through the end of the year.
“All of our orders placed in the fall or for fall delivery will probably have tariffs attached to it,” Smith said. “So yeah, that's all we can do, just try to get ahead of it right now and try to save ourselves and our consumers, our market, as much money as we can.”
When asked how this could affect Christmas shopping, Smith said price increases could be significant; however, everything is up in the air right now.
“You know it varies widely,” she said. “Some of our vendors are at this moment only increasing product prices by 20 or 30%. But you know, if they're hit with 145% tariff, that is an incredible amount of money that they can't afford to absorb. I think we're going to see another 30%, 40% increase. It's not sustainable.”
