DENVER — President Donald Trump on Wednesday announced a pause on reciprocal tariffs for most countries for 90 days, instead imposing a 10% baseline tariff. The change does not apply to China, which now faces a 125% tariff.
Colorado small businesses fear they are caught in the middle between the U.S. and China.
For the past few years, Lexi Larson has been living out her dream after leaving the corporate world to start her online store Sunday Cherries.
“I make cute, colorful, fun matching loungewear sets that you can wear for working from home, going to the grocery store,” she said.
But now the fate of Sunday Cherries is up in the air amid the 125% tariff on imported Chinese products.
Larson currently has $30,000 worth of product in transit from China and doesn’t know what extra costs she’ll face once it gets to the United States.
“I'm speaking with a freight manager to kind of see what they have to say. But it really is like nobody knows. It's changing day to day,” she said. “It's either send it back, pay another few $1,000 in shipping to send it back to China, then I have no product to sell [and] no business, or I somehow come up with $30,000 to pay customs, and then I have to increase my prices.”
If she increases her products, her $98 sweatshirts could cost several hundred dollars.
Finding a new manufacturer is a months-long process, according to Larson, and she can’t afford to put her store on pause.
Larson said she tried to find an American manufacturer when she initially launched her online store, but the costs were too high.
“This is not something that a small business owner can just switch on a dime. You have months and months' worth of conversations and contracts. And manufacturing alone takes two months for the manufacturing, another month to ship it by sea,” she said.
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Denver7 went to Metropolitan State University of Denver economics professor Dr. Kishore Kulkarni for answers.
“The process usually is that the goods that are in transit are excluded from this. There is a certain date at which the tariff starts, and therefore, anything after and before is taxed,” he explained.
But as it pertains to the latest tariffs, he said, “It’s not been specified as [of] yet.”
For now, Larson is taking it day by day as she waits for more clarity.
“No one is gonna say, ‘Oh, I still need that crew neck from that small business.’ So I feel like it's just gonna wipe out all of those small businesses,” she said.
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