Gail Ross welcomes the 90-day pause on the 145% tariffs on goods from China. About half of the clothes sold by Krimson Klover, the women’s apparel company where she is the chief operating officer, are made in China.
But what happens after the 90 days are up, Ross wonders. If the Trump administration re-imposes all the tariffs he announced on April 2, the total would be 46% on Vietnam, where Krimson Klover moved a third of its business when the president imposed tariffs during his first term in office.
Before President Donald Trump unveiled his so-called reciprocal tariffs, Krimson Klover, based in Boulder, was paying 7.5% on its imports from China.
In a temporary halt to an escalating trade war, the U.S. agreed Monday to slash the levy on China from 145% to 30%. China agreed to lower its tariff rate on U.S. goods to 10% from 125% while the two countries try to reach a longer-lasting deal.
“It’s great that this went down, but we’re still looking at a 30% tariff that wasn’t in our prices when set up (2025),” Ross said. “The consumer is going to ultimately pay for it.”
While encouraged by the lower levy, Keaton Brown, who started a windshield wiper business with his brother, Kyler, said 30% is historically high. Even so, the brothers’ business, The Windy Company, will look into submitting more orders while the lower tariff is in place.
“I certainly expect some hiccups because I imagine there are a lot of companies in the same boat right now that will be ordering more products,” Brown said.
The Browns’ 4-year-old company delivers windshield wipers once or twice a year to subscribers. The wipers, made from 100% natural rubber, are manufactured in China.
The Windy Company ships from a warehouse in Grand Junction to people in all 50 states. Brown said the business has been growing, but is putting any expansion plans on hold until it’s clear what direction tariffs will take.
At Krimson Klover, the scramble is on to get products on ships in time to beat the end of the 90-day stand down from the higher taxes on imports.
“We’re trying to get everything on a boat by Aug. 12,” Ross said. “Everybody and their brother are going to try to get on a boat by about Aug. 1.”
Other U.S. businesses are hurrying to make sure their products can make it across the ocean before any jumps in the tariff rate. Ross expects the freight costs to rise.
There’s the uncertainty about being able to get goods out of China during the 90-day window. And, Ross said, there’s not knowing what comes next. Krimson Klover has been working with a large customer who will get some of its orders during the pause on higher tariffs, but has other products set to arrive in October and November.
“We have not yet decided what to do with that customer,” Ross said. “Do we go back to 145%, which in theory will happen in August? Or do we make a bet that’s not going to happen and that this pause will be permanent?”
For now, Krimson Klover’s producers in China, the company and retailers are absorbing the current cost increase.
Ross said a friend just halted operations at a Colorado company that makes down jackets and rain wear after the Trump administration hiked the tariff to 145% on imports from China. She said other people she knows whose companies make hats and accessories are struggling.
Ross believes Krimson Klover will hold on, but said the turmoil is taking a toll. The company has stopped hiring and stopped marketing.
“We’ve stopped all sorts of things we can control to get our budgets aligned,” Ross said. “It’s quite difficult for small business and irritating that there’s not more understanding from Congress.”
If the goal is to boost manufacturing in the U.S., Ross said loans and other help should be offered to companies and plans revitalizing industries should be developed. When facing higher tariffs levied by the first Trump administration in 2019, Krimson Klover looked at moving its production to the U.S., but couldn’t find the right fit.
“At the moment, the infrastructure doesn’t exist,” Ross said. “The textiles are not here anymore. The machines are not here, and the people to make it aren’t here.”
Brown said he isn’t sure what goals the Trump administration has in mind when it comes to tariffs.
“I know for consumers, myself being one of them, we can expect higher prices,” Brown said. “I know businesses that import, we can expect uncertainty, which hampers growth and ultimately economic productivity on a larger scale.”
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