While U.S. businesses come to terms with the now 25 percent tariffs on $200 billion worth of Chinese imports, many companies are concerned about yet another round of possible tariffs.
CGTN’s Hendrik Sybrandy reports on one business in the state of Colorado very worried about that.
One building in Colorado Springs, Colorado is all about bringing folks joy. Elope sells headwear, costumes, and accessories for Halloween and other occasions.
“We make whimsical wearables,” said Keith Johnson, Elope’s C.E.O. The company is one of many caught up in the U.S.-China trade dispute.
“It’s not fun to be in the middle of a trade war and your products being right there in the middle of it,” Johnson said.
We first met Johnson last fall shortly after a 10 percent U.S. tariff on $200 billion worth of Chinese imports went into effect. Most of Elope’s one thousand-plus products are manufactured in China. Since then, that 10 percent tariff on things like headwear has gone up to 25 percent. That represents 40 percent of his business. He can’t absorb all of that increased cost meaning…
“We’re going to have to raise prices, there’s no doubt, and that’s going to fall on the consumer,” Johnson said. “There’s very little I can do about it at this point. I can just keep making great products and bringing them out to the public and hoping they love our products even if they’re more expensive.”
Now comes the specter of a new 25 percent tariff on all of Elope’s remaining products. The Trump Administration said it’s considering it. Johnson figures half of his items will have to be marked up.
“It’s huge,” he said. “It’s not going to shut us down, but it’s going to hurt badly.”
Elope stands for “Everybody’s Laughing on Planet Earth.” The company, which is doing more and more business online, sells fun in all its permutations. It prides itself on being a positive place to work. But the trade issue hangs over its 50 employees.
“It can be challenging, and it’s scary for people,” said Carolye Asfahl, Elope’s Chief Operations Optimizer. “And it’s hard when you have these outside forces against us that can really impact that morale.”
Asfahl said small and medium-sized firms are bearing the brunt of the trade dispute.
“It’s the companies like us that are feeling this pain the most,” she said.
Along with, Elope said, workers in its Chinese factories who worry about smaller orders and whose profit margins are thin as it is.
“They are very stressed out,” said Franzi Fu, Elope’s Chief Fun Officer. “They are afraid. To them, it’s a survival issue.”
President Trump argues the costs of the dispute are largely shouldered by China through its tariff payments. Johnson disagrees.
“Yeah, that’s the biggest joke of them all because none of it is borne by China,” he said laughing.
With no resolution in sight yet, he thinks tariffs will bedevil Elope for years which means they’ll simply have to grin and bear it here. At least, they’ve got the grinning part down.