Bay Area Business Is Already Tough. After Trump’s Tariffs, Many Are Preparing for Pain

While President Donald Trump has defended his tariffs as “medicine” for American industry during what he calls an economic emergency, many Bay Area small businesses that rely on imported goods are bracing for major upheaval.

Trump’s aggressive trade policy unveiled last week sent shockwaves through the global economy and U.S. markets. In addition to a 10% baseline tax on all imported goods, the U.S. will impose “reciprocal” tariffs affecting dozens of trade partners.

Those levies will increase costs for business owners — increases that many expect will be passed on to consumers.

Taylor Peliska, an employee at King Kog Bicycle Shop in downtown Oakland, estimated that roughly 90% of the goods in the store are imported. If Trump’s tariffs on goods from China and Taiwan remain, prices will definitely increase, he said.

“Almost everything that we make is from overseas,” Peliska said. “I personally don’t think tariffs are bad … but to do it in a sort of blanket way doesn’t really make sense, and to do it without having any domestic infrastructure to replace it also doesn’t make sense.”

“Prices are going to go up, but for how long … we don’t know.”

Other small businesses face the same uncertainty.

China, which exported over $400 billion worth of goods to the United States in 2024, faces a 34% tariff, which is set to take effect Wednesday. Trump also threatened this week to impose an additional 50% tariff on China after the nation announced plans to issue a 34% import fee on the U.S. in retaliation for Trump’s initial announcement.

Erik Bigglestone, who co-owns Games of Berkeley in the East Bay, said the store is already preparing for the worst. Nearly all of the board games and toys sold in the store are imported, and more than 90% of its products come from China, he said.

Many manufacturers and store owners in the games industry are worried that the tariffs could put them out of business, Bigglestone said. Games of Berkeley, which has been in the community for nearly 45 years, is also at risk of going away, he said.

Suppliers have warned him that some goods may go up 10% to 25% in price over the next few weeks. As a small business, Games of Berkeley will need to pass some of those additional costs onto consumers, which could deter them from shopping locally when companies such as Amazon will be able to eat more of those import taxes, he added.

“It’s already expensive to do business in the Bay Area,” he said. “When you start throwing more and more expenses on top of it, that can really make people think twice about whether they even want to try and weather that storm.”

Bigglestone said he and the game store’s other owners have discussed raising prices preemptively so that they’re prepared for increased import costs moving forward. They’re also looking at increasing the store’s used games inventory and eliminating less popular options.

“It’s a pain and trauma that is being inflicted without any thought to the actual real-world consequences,” Bigglesone said.

Neale Mahoney, a professor of economics at Stanford University, said Trump’s tariffs will have sweeping effects across most industries. Businesses that rely on imported goods will be the first to increase their prices, but suppliers that import raw materials will also need to adjust, he said.

As those businesses begin increasing the prices of their goods, even companies that don’t rely on imports will be incentivized to follow suit, driving up the expected price for certain items universally, he said.

Ryan Cummings, chief of staff at the Stanford Institute for Economic Policy Research, said it’s rare to see financial uncertainty that is so reversible. If Trump announced that the tariffs were canceled, a lot of the fear and anxiety driving the market would decrease, he said, referencing the sudden market downturn that followed Trump’s announcement.

“If these tariffs stay where they are, we’re talking about destroying global supply chains and global value chains,” Cummings said. “If the tariffs stay in place, it will not only be a recession but a deep recession. But it’s avoidable. It’s completely avoidable.”

Back in Oakland, a few doors down from King Kog Bicycle Shop is Howden Market, a small corner store that sells artisanal wines, beers and other craft goods. Kanitha Matoury, the store’s owner, said she was drawn to the neighborhood because of the beautiful building and her passion for food, drink and community.

While Howden sources many of its products locally, several of its nearly 200 vendors get the raw materials for their cans and bottles from overseas, Matoury said, adding that the United States doesn’t have the infrastructure and the factories to keep up with demand.

In recent years, inflation has made it difficult to stay afloat, Matoury said, adding that Trump’s tariffs will make it even harder. In cities such as Oakland, where the small business sector is taking a hit from increased rent and petty crime, store owners can’t take much more, she said.

“I believe, like what Barack Obama said, that small business is the backbone of our economy and the cornerstone of our community,” said Matoury, who is running for Oakland City Council. “Small businesses all over America are literally just closing shop.”