Trump’s Tariffs Are Killing My Small Business

And the tariff refund process is too little, too late.

By J.C. Sutherland

The president is on a losing streak. His tariffs—a decades-long fixation, which he seems to view as a magic pill for the US economy—are failing in one court case after another.

The first blow came in February, when the Supreme Court struck down Trump’s authority to impose tariffs under the International Emergency Economic Powers Act (IEEPA), a law designed for genuine national security emergencies, not trade policy. I submitted a sworn affidavit in an amicus curiae brief in that case, opposing these tariffs based on what I have personally experienced with my business, writing: “Tariffs have forced us to raise prices at the same time as demand has been weakened with the overall economy softening.”

After this ruling, when the administration moved to re-impose tariffs by other means, those too have been challenged in court.

But all of this is too little, too late for thousands of small businesses across the country—including mine. For us, victories in the courts are welcome news, sure, but they’re cold comfort when we look at the damage that’s been done to our bottom line by Trump’s tariff spree. Many of us fear we won’t make it, and that’s doubly hard to stomach when you consider that the economic headwinds we’re facing are entirely man-made.

De-Fi, my Southern California-based company, designs and manufactures premium studio furniture and acoustic gear—high-end recording solutions differentiated by design and quality, sold to both professional musicians and hobbyist enthusiasts. Even passionate hobbyists are price-sensitive, and our products are often the first crossed off shopping lists when the economy softens.

Tariffs have forced us to raise prices just as demand has weakened with the overall economy. Beyond suppressing demand, tariffs have paralyzed us from making production and supply decisions due to fear of being burned by unpredictable decrees outside the normal legislative process. We have delayed new product introductions because we cannot plan a business case when we don’t know what we’ll have to charge, or even where we can build products. We’re scared of starting any new production lines.

Trump has cited as justification for his tariffs the need to “reshore” industries—that is, bring production back into the US, rather than have it based in China or other nations around the world. Ironically, though, tariff uncertainty has halted our plans to reshore some of our manufacturing because we have no idea how much inputs will cost.

There’s a misconception that companies manufacture abroad simply because it’s cheaper. While that used to be true, automation and increased labor costs abroad have narrowed the gap. What countries like China offer is a huge, reliable, and consistent supply chain with dependable manufacturing capacity: a one-stop shop.

One of the biggest challenges with manufacturing in the US is creating the supply chain that leads up to final assembly. This was improving, making US manufacturing more competitive with China, as NAFTA and the USMCA created a North American manufacturing bloc. Companies in our industry were reshoring or moving closer to home, but these latest rounds of tariffs have completely blown that up.

It’s nearly impossible to build a supply chain for new domestic manufacturing with this level of volatility because lead times are measured in months and years. The reality is that the US does not have the capacity or raw materials to support completely domestic supply chains. Even if we did, using our capable and educated workforce to make simple widgets at the bottom of a supply chain would be a poor use of resources.

We want to bring manufacturing back to the US not only to employ our neighbors, but because there are significant cash flow and quality advantages to just-in-time production closer to home, even if it’s slightly more expensive. Ironically, protectionist policies make this impossible. That’s not even accounting for retaliatory tariffs destroying the viability of US-made products in foreign markets. It’s simply a better bet to pay tariffs once on a finished good made in China—which we can also sell worldwide without additional tariffs—than to navigate paying constantly changing tariffs on imported inputs, then use those inputs to finish products in the US, and then still face retaliatory tariffs when exporting to global markets.

Tariff policies are supposedly in place to encourage domestic manufacturing, but they’re doing the opposite for businesses like mine. We can’t make long-term investments like reshoring when we have no idea what our input costs will be next month, let alone next year. We operate on tight margins with limited cash reserves. We don’t have legal teams parsing executive orders or customs brokers navigating Harmonized Tariff Codes. We’re small business owners trying to create jobs and serve customers, but the unpredictability has frozen us in place.

Monitoring social media to plan a supply chain is no way to run a business, and the mental toll on me and my colleagues is significant. We haven’t hired people because of this and have cut contractor hours. This tariff adventure isn’t an exercise in the theoretical art of the deal. It’s about livelihoods, family vacations, and paying for little league. When you have small children, you have a small window to create memories and make an impact. It’s maddening that the headwinds affecting my son’s childhood are entirely manufactured in support of a trade theory that nearly all economists (and frankly, history) have debunked. It’s doubly maddening that calling my representatives in Congress is pointless because these tariffs are imposed outside the law.

The administration recently rolled out its tariff refund process, by which businesses that paid tariffs can get repaid. But from the start, the process has been opaque and difficult for small businesses to navigate. Large multinationals with big budgets for highly specialized lawyers are in a good position to capitalize on the refunds. But the rest of us simply don’t have the time, money, or expertise. And even if we did, the payout—assuming it comes at all—would still be just a fraction of what’s been lost.

I never thought I would need to submit an affidavit to the Supreme Court, or write this essay in order to be able to run my small business unencumbered in the United States of America, but here we are.

The Supreme Court and lower courts have moved decisively to restore constitutional checks and balances on tariff policy. In response, the executive has sought one end-run around after another. Congress, not a single executive, should set trade policy with predictability and proper notice. American businesses and American workers deserve better than this chaos.

J.C. Sutherland is the CEO of De-Fi Systems, LLC, a California-based company that designs and sells premium studio furniture and acoustic gear for music production.