Tariff talk causes uncertainty among businesses in San Mateo County

For San Mateo-based Fanloli — which sells accessories, gifts and skincare products largely imported from South Korea — the tariffs have been a hit to business, founder Fanny Deng said.

Tariffs have been imposed on products coming from South Korea and 25% duties are hurting the country’s trade-reliant economy, Reuters reported. But they’re also damaging to small, American businesses, Deng said.

“I wish they [didn’t] have the tariffs. It makes it very difficult for the small businesses,” she said. “It’s a negative impact. I don’t see they are increasing jobs or anything for the U.S. — it’s increasing costs for everything.”

Fanloli hasn’t increased the prices of the popular K-Beauty skincare and trendy charms it sells, Deng said; however, an increase of 18% on shipping prices is cutting into the store’s revenues. About 30% of their inventory is imported and 70% is bought from U.S. wholesalers, though, those wholesales import goods from other countries as well.

“The cost is increasing, so the revenue margin is less,” she said. “We are afraid to increase prices for the customer, so we are kind of in the middle.”

Other stores selling imported goods in San Mateo County, like Italfoods — a specialty Italian food seller in South San Francisco — have seen their industry band together to absorb the increased prices tariffs are causing.

“We have long-standing relationships with suppliers, many over 40 years and a lot over 35 years. It’s always in the best interest that we look out for all parties,” Richard Armanino, Italfoods sales and purchasing director, said.

While raw material prices are causing the subsequent price of specialty goods like coffee and chocolate to go up, the baseline 10% tariff applied to countries within the European Union, like Italy, is not directly causing an increase in product prices, he said.

Though Trump threatened much steeper 50% tariffs on the EU over the weekend, he’s since backed down on the plan for now. It’s that uncertainty, more than any immediate fiscal impact, that is causing many businesses stress.

At Italfoods, that means budgeting more conservatively when placing orders for busy seasons, like Christmas.

“We’re proceeding cautiously, and I’m working off a projected weakening budget, just in case,” Armanino said. “So we’re preparing for the worst and hoping for the best.”

Some business owners, like Gerald Weisl of Burlingame’s Weimax Wines and Spirits, are also trying to ride out the wave of precariousness that the Trump administration’s approach to foreign trade policy has brought.

As a purveyor of fine wines, Weisl also imports from EU markets, which are currently only subjected to a 10% across-the-board tariff.

“How can you determine which way the wind is blowing in this field, since things are so fluid with the Trump administration?” he said. “So far we’re OK, and a few things have gone up a few dollars a bottle — but only a few percentages. People are trying to share the impact.”

But the tariffs are making importers and shipping companies wary, Weisl said, recalling one shipping container of wine from Italy that wasn’t sent because the shipper was concerned tariff policies would change by the time it reached the U.S.

Despite this, he said that, for now, European purveyors are sharing in the tariff burden and noted, like Armanino, that companies are working together to absorb the burden.

“We’ll see what happens,” Weisl said.