All local entrepreneurs grapple with questioning durable longevity due to implementing price increases, following the Trump tariffs.
In the past couple of months, Toronto bar owner Cesar Mesen has faced escalating costs due to U.S. President Donald Trump's tariff assault on Canada and the global market. The tariffs have led to increased prices for food and supplies at The Pint Public House, causing Mesen financial strain. While he has been negotiating with suppliers to source Canadian or non-U.S. goods to minimize expenses, Mesen forewarns that the bar may eventually need to raise menu prices if tariffs persist.
Mesen is not alone in grappling with tariffs' impacts, as small businesses across Canada struggle amidst Trump's daily trade proclamations. Data from a survey conducted by digital financing company Merchant Growth reveals that nearly 40% of Canadian businesses have increased prices due to tariffs. Although eight out of ten of these businesses have passed on only a quarter or less of the added costs to customers, the burden remains substantial.
The survey's findings align with those of other small business groups. The Canadian Federation of Independent Business's surveys discovered that small business owners anticipate hiking customer prices by an average of 3.7% and 3.5%, respectively, in March and April.
Joe Conte, chief growth officer at Merchant Growth, explains the impacts, "We looked at all industries, from steel manufacturing to transportation and even to discretionary goods and retail. They were seeing a lot of direct impacts." The increased costs for manufactured goods, particularly those containing aluminum or steel, and the indirect impact of slower supply chains have presented small businesses with maintaining revenue while keeping prices competitive.
In addition to raising consumer prices, small business owners have attempted to mitigate tariff impact by seeking alternative suppliers and new export markets. However, without clear evidence of recent tariff announcements targeting Canada, Conte points out that uncertainty remains.
Although customers at Mesen's bar can expect consistent menu prices for the time being, potential tariff announcements or deteriorating economic conditions may prompt changes. Regarding the future, Mesen states, "Passing the cost on to the guests has to be the last choice." Despite the current uncertainties, small businesses are adapting to the new environment by diversifying markets, optimizing supply chains, and leveraging legal and financial strategies to mitigate tariff impacts.
- Cesar Mesen, a bar owner in Toronto, foresees the possibility of raising menu prices at The Pint Public House due to persistent tariffs, joining other small businesses in Canada that have already increased prices by an average of 3.7% and 3.5% in March and April as per Canadian Federation of Independent Business's surveys.
- A digital financing company Merchant Growth's survey found that nearly 40% of Canadian businesses have increased prices due to tariffs, with eight out of ten passing on only a quarter or less of the added costs to customers.
- Joe Conte, chief growth officer at Merchant Growth, explains that small businesses across diverse industries like steel manufacturing, transportation, and retail have experienced direct and indirect impacts from tariffs, leading to increased costs for manufactured goods, particularly those containing aluminum or steel.
- In an effort to mitigate tariff impacts, small business owners in Canada are seeking alternative suppliers and exploring new export markets, as warned by Mesen, who is also looking to source Canadian or non-U.S. goods to save costs.
- Despite attempts to adapt, the uncertainty remains without clear evidence of recent tariff announcements targeting Canada, as pointed out by Conte, with small businesses having to face the challenge of maintaining revenue while keeping prices competitive in a slowing supply chain and potentially volatile global economy.
