Global tariffs have local consequences on Whidbey

For small business owners on Whidbey Island, the current presidential administration’s global tariffs have had a big impact, resulting in the impending closure of at least one business on the South End. Many have found it to be confusing and difficult terrain to navigate, complicated by unpredictable changes.

Accidental overcharges, shipments held up at customs and duty bills in limbo are just some of the issues business owners have had to contend with over the past few months as they’ve tried to keep abreast of the evolving situation.

April 2 “Liberation Day” tariffs proposed by President Donald Trump called for a 10% minimum tariff on all imports, though he announced a 90-day pause the following week. At that time, the nation’s overall average effective tariff rate was 27%, the highest since 1903, according to the Budget Lab at Yale, a nonpartisan policy research center. Since then, there has been much back and forth resulting in various delays and exceptions depending on the country or type of product.

As of June 1, the Budget Lab reported that consumers are facing an overall average effective tariff rate of 15.6%. But for business owners, there can be an even higher price to pay.

Sarah Jean Muncey-Gordon, who owns Bandbox Beauty Supply in Langley, said she had to change the annual projections for her business six times this year.

“It really is like playing 3-D chess right now trying to figure out even what next year’s ordering is going to look like,” she said.

Muncey-Gordon opened her store in 2023, which sells imported makeup and skin care products from other countries that adhere to higher standards of chemical safety in cosmetics than the U.S. She has been intentional about carrying brands owned by women and people of color that are vegan, allergy-friendly and cruelty-free.

But with the ongoing uncertainty, Muncey-Gordon made the decision to close her shop. Even though business has been good, it’s been a challenging time to be an international importer of beauty products. And even U.S. brands rely on globally sourced ingredients to make their products.

“The beauty industry has never, ever, ever been domestic. It’s never been localized to one nation,” Muncey-Gordon said. “It’s been a global industry since the dawn of time, when we were trading perfumes and eyeshadows and oils and things like that in ancient cultures.”

From the start, she has been committed to keeping her prices affordable, and she’s not interested in raising them now to make up for the cost of the tariffs she’s had to pay as an importer. From the time an order is placed to the time it arrives, the rate of the tariff can change within a few weeks’ time.

“If you’re not checking in multiple times a day, you’re going to be behind,” she said. “It’s the Wild West.”

Other merchants expressed similar sentiments about the situation’s unpredictability.

“It’s like being on a teeter-totter and you’re not sure if you’re going to fall off,” Mona Newbauer, owner of Sweet Mona’s Chocolates, said.

Newbauer purchases her colorful packaging from China, which has been hit especially hard by tariffs in recent months. Importers faced a 145% tariff on all Chinese goods until May 14, when it decreased to 30% for the next 90 days, pending trade talks. One of Newbauer’s shipment of boxes came in around that date, and she’s still waiting to receive an invoice to see which rate will apply.

For those who make the argument for buying products made in America instead, Newbauer encourages people with that thought process to take a look at the clothes in their closet to see just how many items are manufactured in China.

As a result of the tariffs, Newbauer has raised prices by 6% to 10% in her Langley chocolate shop. She is now ordering stock for the holiday season, and is confident it will be a good summer for business in the Village by the Sea based on the sales she made during Memorial Day weekend.

“I’ve made it for 19 years,” she said. “I don’t plan on leaving.”

Sharon Lundahl, who owns Music For the Eyes with her husband, Fred, was mistakenly charged a 40% tariff for a shipment of rugs from Pakistan, which amounts to $9,000.

“Mostly right now I think the problem has been confusion and worry, but no actual harm done,” she said, adding that she is expecting to get the money back within 90 days.

She estimates that it will probably be about a year before she runs out of inventory. The unique gift shop in Langley has always featured products from around the world, but in recent months, the couple has stopped buying items from China.

One big draw for Madrona Supply Co. in Clinton has been its vast variety of imported candy, which customers can mix and match in bulk. It’s a favorite among adults, who tend to care more about their calories, and it isn’t made with artificial colors or sweeteners, according to owner Janae Cameron.

“The main issue we have had on importing Swedish candy, which is the most frustrating for customers because it’s a favorite consumable that you can’t get in the U.S.,” she said.

In April, Cameron lost about $400 on a shipment from Sweden that got stuck in U.S. customs. It was especially frustrating because she was asked for a document she couldn’t provide, a number for USDA food manufacturing which her store doesn’t have because no food is made in the gift shop.

“It is completely confusing and chaotic to people,” she said, adding that it is an unnecessary extra stressor for small business owners.

Apparel in her store, which comes from South America, has not yet seen the ramifications of tariffs yet because distributors are still going through leftover stock in their warehouses. Buying the clothing in North America would likely double her prices.

“I understand that people want American made when possible and affordable,” she said. “I would say that’s the asterisks. I don’t want to charge $50 for a T-shirt. It’s not fair to customers, it’s not fair to us.”

Cameron does the printing on clothing in house. Madrona Supply Co. also has the advantage of selling products made by Turnco Wood Goods, its sister company in Clinton.

Berty Hansen, who owns Alma and Alma Kids with her mother, Diane Sorensen, said the highest tariff rate she has seen on an order was about 25%. The two clothing stores in Langley focus on sustainable fashion that’s ethically sourced and made using natural fibers. Products come from Canada, Spain, Norway and Denmark, among other countries.

“In something that’s as specialized as what we do, there aren’t enough U.S. brands to support my entire store that goes along with our whole ethos, so I have to buy from out of the country in order to keep the quality of what I’m doing,” Hansen said.

As a result, prices have increased for a few things in the stores, and the owners have also absorbed some of that cost.

“To anybody who will listen, I will scream from the top of the mountain to shop small, shop local, support your people because we’re doing our best to make a living,” Hansen said.

There are others, however, who have not been as impacted by the tariffs. Alexa Allamano, owner of Foamy Wader, a jewelry store in Langley, said she switched most of her ordering to domestic materials in the wake of the COVID pandemic. With the exception of gemstones, she’s been able to purchase her supplies and packaging in the U.S. Fortunately, her precious metals do not contain aluminum or steel, which recently experienced a large increase in the tariff rate.

Allamano said it will be interesting to see how much she will pay on her next order of gems. If it goes up by 10% or 15%, she believes she can absorb the cost.

“I feel weird because I know how many people are being really dramatically impacted,” she said. “I just shifted things luckily into this sweet spot that I’m not seeing a lot of it, personally.”

All business owners agreed it has been challenging to keep up with the latest news regarding tariffs. Some have used Reddit to stay in the know, while others rely on information from the state Department of Commerce’s website. Kristina Hines, the executive director for the Economic Development Council for Island County, is actively working to gather data from local business owners to measure the impact of tariffs on each industry, but did not have anything to report as of Friday.

As for Bandbox Beauty Supply, Muncey-Gordon plans to remain open through the end of July to sell her remaining inventory. After that, the store’s space will become part of next-door C’est Moi Salon, where Muncey-Gordon has accepted a job as a hairdresser beginning in August.