NEW YORK, NY — Small business owners in the United States and Canada say the latest round of tariffs between the two countries is landing hardest on companies that already operate on thin margins. The trade fight has added new costs to shipping, equipment and materials, while also creating customer hesitation that is harder to measure but just as damaging.
Business owners interviewed by The Associated Press said the strain is being felt alongside higher energy expenses tied to the war in Iran. For some, the combination is turning routine operations into a constant balancing act, with lost orders, surcharges and delayed projects adding up quickly.
Although analysts say the tariffs cover only a modest share of overall bilateral trade, owners of smaller firms argue they have little cushion when customs duties, fuel costs and supply chain uncertainty all rise at once.
Vermont cheesemaker says Canadian backlash is hurting orders
At Jasper Hill Farm in Greensboro, Vermont, co-founder Mateo Kehler said the trade dispute has already led to canceled holiday orders from wholesale customers in Canada. The company is located about 40 miles from the border, and Canada has long been an important market for future growth.
Kehler said cheese itself was not included in the new U.S. tariffs, but that has not spared the business from the fallout. He believes the bigger problem is public resentment in Canada over how President Donald Trump and members of his administration have spoken about the country.
That response, he said, has affected sales more than the formal tax changes. He also pointed to the added burden of paying more for materials and equipment from Canada, while fuel for trucks and machinery has become more expensive because of the war in Iran.
Some suppliers and distributors have added surcharges to deal with their own higher costs. Kehler described the pressure as a steady accumulation of expenses across nearly every part of the business, from farming to finished goods.
Canadian distiller equipment maker sees delayed U.S. projects
On Vancouver Island, Revival Stillworks makes distilling equipment and helps design spaces for craft spirits producers. Co-founder Darcy Lane said the company’s stills, fermenters and related products used to cross into the United States without tariffs under the United States-Mexico-Canada Agreement.
That changed last month, when the equipment began drawing a 50% duty, Lane said. Because individual projects can range from $250,000 to $2 million, the customs charges can quickly become large enough to derail a deal.
Lane said the company has millions of dollars in orders expected over the next four to six months, but the tariff announcement has already made some potential customers hesitate. He recalled that a U.S. client backed out of a project last year after Trump threatened tariffs on Canadian products.
About half of Revival Stillworks’ business comes from U.S. clients. Lane said the company is also facing higher shipping expenses as oil prices rise during the Iran war, and that may force the firm to look at other lines of work, including service for the local marine industry.
Nashville manufacturer says Canadian sales have cooled
Cassandra Sotos, co-owner and CEO of AmpRx in Nashville, said the trade tensions are creating a quiet slowdown in her company’s Canadian business. AmpRx makes devices that help musicians and recording studios measure and adjust voltage going into guitar amplifiers.
The company’s main product is not directly affected by the new tariffs, Sotos said, but Canadian demand has still dropped. She is not sure whether buyers are worried about surprise import charges or whether the challenge is simply the current perception of the United States in Canada.
Even though most of AmpRx’s sales are domestic, Sotos said the loss of any segment matters to a small company trying to grow. She noted that there are many guitar players in Canada and that the business is currently reaching only a small share of them.
She also said shipping costs for imported components are now two to three times what they were before the war, adding another layer of expense just as the company tries to absorb the effects of tariffs.
Honey tariffs add more pressure on a strained Canadian industry
The dispute is also worrying producers farther from the immediate border. Peter Awram, CEO of Worker Bee Honey Co. in Rosedale, British Columbia, said a new U.S. tariff on Canadian honey started in August and hit an industry already under pressure.
Awram said the United States accounts for about 60% of Canadian honey export volume. That makes access to the U.S. market especially important for Canadian beekeepers, many of whom depend on sales beyond their local region.
Canada responded with a 50% tariff on American-made honey, but Awram said that does little to solve the underlying problem. He said competition from fake honey imported from India and China, often diluted with rice syrup, has already squeezed prices on both sides of the border.
In his view, many of the products Canada is now taxing are not truly American honey at all, but foreign honey shipped with U.S. paperwork. He warned that if the tariff remains in place for long, a large number of commercial beekeepers could be forced out of business.
Why small firms say the impact feels bigger than the numbers
Analysts say the tariffs currently cover only about 5.5% of U.S.-Canada goods trade, which is why the overall hit to the broader economy may be limited. For small businesses, though, the effect can be much sharper because they depend on a narrow set of customers and suppliers.
Owners interviewed by AP said the trade conflict is doing damage in two ways: directly through customs taxes and indirectly through the atmosphere it creates. In some cases, customers are pausing purchases before a tariff even reaches them.
Higher fuel and shipping costs tied to the war in Iran are adding to the strain. For companies with international parts, cross-border sales or specialty manufacturing, the result is a stack of costs that can erase profit on individual orders.
That is why several owners said they are now considering backup plans, shifting product lines or searching for new markets. Even when the tariffs do not touch their main products, they say the uncertainty alone can slow growth and complicate planning.
