BALTIMORE — Small business owners are feeling the pressure of tariffs as they place orders for holiday merchandise, forcing them to make difficult decisions about pricing and inventory. July is when retailers place orders for products customers will come looking for in the Christmas season.
At the Margaret Cleveland in Baltimore, shop owner Christopher Heller is navigating the challenges of maintaining the high-quality merchandise his customers love while keeping prices reasonable amid economic uncertainty.
"The Margaret Cleveland is the manifestation of everything three special women brought to my life," Heller said.
Heller and his husband have created what they call a "one acre wonderland of retail discovery" at Walther Gardens, combining a home and garden boutique, event space, and community garden. His mother and grandmothers taught him to recognize unique high-quality craftsmanship.
"Three humble but special women who inspired everything," Heller said.
The winding paths around the little shops feature beautiful pieces from around the world, with items that often showcase techniques that can only be done by hand. No fast fashion here.
Among his inventory are German-inspired Christmas ornaments and candles from what he describes as the oldest candle maker in the world.
"They really come as a premium product and something that is more authentic," Heller said.
In his Christmas shop, Heller typically stocks hand-blown Shiny Brite ornaments, an American Christmas classic. But with ongoing tariffs dimming economic forecasts, the manufacturer has elected not to produce any this year.
"Shiny Brights told me at the beginning of the year they weren't even going to be moving forward because that 45% tariff made it, it was not cost effective to even produce it," Heller said.
It all boils down to cost.
"Typically, in retail whenever you are buying from an artisan...it's typically a 50% markup," Heller said.
That markup isn't all profit. Heller says up to 30% of the price of an item goes to expenses like mortgage, employees and utilities, then add on shipping …and now tariffs.
"Retail is one of the slimmest markets as far as margins. Profit margins," Heller said.
When retailers make deals with manufacturers to sell their products, the price may change by the time the bill comes due. During a tariff war, small businesses must balance who ends up shouldering that cost — manufacturer, retailer, or customer.
This happened with some hand-sewn pieces from India that Heller carries — brooches and art objects with incredibly detailed embroidery. When the Trump Administration placed a 26% tariff on all products from India, Heller faced a choice after the manufacturer alerted him to the price increase.
"I didn't want to let them go and hurt the other small business and the artisans who, you know, poured, you know, six to nine months into hand making these," Heller said.
So he's absorbing a 10% cost increase without passing it along to customers, while the manufacturer is shouldering the rest.
"It really is kind of a crapshoot in the sense of what am I really going to end up paying," Heller said.
With products from all over the world, the tariff percentages differ from product to product. And the balancing act continues with potential tariffs ranging between 10 and 50%.
"Those are big swings," Heller said.
For now, Heller says he'll pivot when necessary, shielding what he can from his customers while still supporting the artisans he loves.
"I'm gonna make this go as absolutely long as I can because this is building community," Heller said.
This story was reported on-air by a journalist and has been converted to this platform with the assistance of AI. Our editorial team verifies all reporting on all platforms for fairness and accuracy.
