Many of us are bracing for the announcement from the White House on reciprocal tariffs. Most likely, we are expecting to see 25% tariffs on Canadian and Mexican imports. What is unknown is the other tariffs that may also be announced.
How can we as small food and beverage business owners prepare? We can all agree that these are complicated times, but that doesn't mean we can't do our best to prepare!
- Diversify your supply chain: it's hard to imagine that just a bit over 4 years ago we were forced to do this same thing when a global pandemic hit. A varied and extensive supply chain can help you now, as it did then! In 2025, this can look like buying as much or all your goods domestically, negotiating fixed price contracts, or finding suppliers that may not be affected by the tariffs.
- Cash Flow Optimization: consult your financial experts on how to predict and manage your cash flow, in order to make sure you have enough funds available to cover higher prices. Consider reducing your overhead and variable costs if you can. Now is a good time to look at your whole business and see where costs can be curtailed or look for ways to become more efficient.
- Communication: if price increases are inevitable, make sure to communicate them quickly and transparently to your customers. Your loyal customers know what is happening, as they are also watching the news! Make sure to prepare them and offer an explanation as to where the additional costs are coming from.
- Research the Tariffs and Trade Programs: do your research! Read up on what the tariffs are and the products they will impact. Also, reach out to experts in the field and ask what they are doing, or what they suggest. You can visit the US International Trade Commission for more details
Above all, hang in there! These are interesting times for the U.S. and will challenge all of us to run our businesses more efficiently. Colorado is an incredible state and our farmers, ranchers and food and beverage manufacturers are a huge part of what makes our state so amazing.
Thank you for being a Colorado Proud member and good luck with all your businesses!
Barb Howe