Detroit boutique owner details impacts of tariffs as deadline for deals passes without ceremony

BY KYLE DAVIDSON, MICHIGAN ADVANCE

MICHIGAN—With President Donald Trump’s administration once again pushing back its deadline for negotiating new international trade deals, small business owners—including a Detroit boutique owner—voiced their concerns on a Wednesday press call, outlining how continued uncertainty around global trade had impacted their business.

While July 9 was supposed to mark the end of the administration’s 90-day pause on country-specific tariffs announced in April, the administration has since extended the pause until Aug. 1, breeding further uncertainty for businesses looking to adapt to increased import costs and changing international trade dynamics.

Aaron Lehman, an Iowa Farmer and president of the Iowa Farmers Union kicked off the call, organized by Tariffs Cost US and Farmers for Free Trade, by underscoring how tariffs are increasing costs across the US economy, threatening growth for local businesses.

“Tariff policies aren’t abstract. They’re affecting real people, real businesses and real nations. This uncertainty is costing businesses and consumers by the minute,” Lehman said.

From family farmers to the owner of a Missouri-based spirits company, business owners from across multiple states offered their perspectives on how the ongoing threat of tariffs had affected their business as well as their international trade partners.

Rachel Lutz, the owner of The Peacock Room in Detroit, said she started her business by maxing out a $1,500 credit card, and had since grown to generating $1.5 million in revenue a year, creating 12 to 14 jobs.

Lutz’s boutiques, located in the Fisher Building as well as The Park Shelton in Midtown, sell mostly women’s apparel and accessories. While they sell a mixture of domestic-made and internationally-produced garments, she noted that 97% of clothing on the US market is made overseas.

“I’m really proud to carry both US-made, Canadian-made clothing, as well as imported, but even those producers have really been rattled by these tariffs, and it’s affecting them, which then affects me,” Lutz said.

Many of the US-based clothing manufacturers whose goods appear in Lutz’s shops use imported fabrics due to the lack of textile mills in the U.S. Lutz said.

“It’s not like you can just wave a magic wand and restart them.…So they’re facing price increases, even though it’s a US label,” she said.

Meanwhile, a Canadian vendor who Lutz said she does hundreds of thousands of dollars in business with, has been absorbing the 25% tariff levied on Canadian goods since springtime.

Lutz said she carries products from overseas to give a wide price range to her customers, noting that she serves a very mixed-income neighborhood in the city.

“As a small business, we are competing against big, big players that ahead of the tariffs going into effect, they were able to ship massive amounts of inventory, warehouse them to buffer their impact from these tariffs. Small businesses like mine don’t have that capability. We don’t have those large pockets of capital to draw upon” Lutz said, emphasizing that small businesses are particularly vulnerable to tariffs levied on consumer goods.

Additionally, tariffs have made planning difficult, Lutz said, noting that after she’d ordered her Christmas inventory in January and February, she received a flood of notices from the more than 100 vendors she carried, each with a different response to the tariff announcements that she needed to keep track of.

“Now, as I’m going to trade shows, I’m trying to buy inventory for next January, next February, and I can’t even figure out what the pricing will be, and my vendors don’t know either,” Lutz said, noting that one vendor she worked with based in the United Kingdom, whose goods were made in China, had opted to pull out of the US market entirely.

Additionally, Lutz said she’s had to absorb the costs of tariffs in order to keep her prices competitive as she faces off with online retailers and lower consumer confidence, meaning people are shopping less as they look toward an uncertain economic future.

After opening her business on the heels of the Great Recession and surviving three years of street construction and five years of post-pandemic change in this business environment, Lutz said it feels like she’s facing an arbitrary and manufactured crisis.

“This is not something that is not within our control to fix. It’s not something that’s not within the lawmakers control to fix, and I want lawmakers to know this is affecting real people,” Lutz said. “I don’t have a partner in my business. This is jobs at stake. This is consumer choice at stake. This is consumer pricing at stake. And this is just a way to further disadvantage small businesses against big businesses.”

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This coverage was republished from Michigan Advance pursuant to a Creative Commons license.