Detroit Regional Chamber > Small Business > Tariffs Hit Small Michigan Retailers Hard, Prompting Panic Buying, Cost Cutting

Tariffs Hit Small Michigan Retailers Hard, Prompting Panic Buying, Cost Cutting

May 26, 2025

Detroit Free Press
Adrienne Roberts
May 23, 2025

When John Murray and his wife started their baby store, Modern Natural Baby, in Ferndale 16 years ago, their goal was not to bring in any products from China.

What they quickly discovered, though, is that nearly all car seats and strollers are manufactured in China. While people often say they want to buy U.S.-made products, Murray noticed customers weren’t willing to pay more for those items.

So, they had to pivot, and Murray estimates that about 80% of the products Modern Natural Baby now sells are from China, which means yes, another pivot, Murray said, after President Donald Trump targeted China in his trade war. The result: 145% tariffs on Chinese imports at its high point but they were temporarily reduced to 30% earlier in May.

Caught in the crossfire are essential items for babies such as car seats, strollers and bassinets, Murray said. He said he worries such items could eventually be more difficult to find as retailers stockpile them due to uncertainty of when the next shipments from China will come in, and will be sold at higher prices that could make these items unaffordable for some families.

“It’s a trying time because all small businesses — it doesn’t matter who you are — we all had to make a decision: You either stay the course, or what you have to do is you have to panic buy,” said Murray, who spoke to the Detroit Free Press in May. “The problem with panic buying is that panic buying means that you might go into debt. If you stay the course, that means in a month and a half, you might not have any products on your shelves.”

The majority of Michigan businesses are navigating tariffs on imports from several countries and are making decisions on whether to stockpile, change suppliers and raise prices for customers.

More than 60% of Michigan businesses import goods from other countries, according to a recent survey by the Michigan Retailers Association, which represents about 5,000 members and 15,000 stores and websites across the state. China, Canada and Mexico were listed as the top countries from which retailers import goods, the MRA said, followed by Vietnam, India, Italy, Spain, France and others.

In response to the president’s tariffs, more than half of the retailers the MRA surveyed have either changed or delayed orders from suppliers in other countries, while nearly 16% have canceled orders. Some retailers shared that they’ve ordered seasonal inventory in advance to avoid pending tariffs, the MRA said. Others told the MRA that they’ve pressed pause on ordering seasonal inventory and are focusing on restocking only the inventory that has sold and keeping shelves full.

At City Bird, what to do as prices rise

Over the past month, Andy Linn, co-owner of City Bird (which offers local goods that are made or assembled in the U.S.) and Nest (a home goods store) in Detroit’s Midtown neighborhood, said he’s received emails from dozens of the stores’ suppliers that say to expect price increases over the next few months as their costs get firmer. For example, greeting card companies are emailing him to say paper costs are going up.

Some retailers, like Linn, are considering changing suppliers because of price increases, the MRA survey found, with nearly 37% of those surveyed saying they’re considering it, while 14% say they have already made changes.

While Linn said he’s explored changing suppliers, the tariff situation is too “unpredictable and uncertain” at this point to make any changes.

“That’s one thing about the unpredictability … you’ll have these long relationships with a supplier or you know the owner of the company that’s selling the goods,” he said. “So changing is not very attractive, but if these tariffs do set in, we will explore other options.”

Linn has tried to stockpile a few items, but there are limitations for a small business, he said, because stockpiling ends up taking up a lot of his capital.

Murray, the baby store owner, said he bought three storage facilities and filled them “to the brim.” Murray said typically, he’d buy four car seats at one time. Now, he’s buying 40.

He said he’s never taken on any debt in the 16 years Modern Natural Baby has been open.

“Now, we’re giving our credit cards a workout,” he said. “The credit card (companies) are calling us saying, ‘This is you, right?’”

Balancing the extra costs

Linn said he’s trying to lower costs this year in anticipation of increased costs for goods. He said he won’t cut staff hours but instead has cut the stores’ advertising budget in half, scaled back on commercial cleaning services and canceled certain subscriptions. So far, he’s been able to cut costs by 5%.

When asked about how tariffs and the threat of tariffs are impacting pricing, two-thirds of retailers reported having to raise prices, the MRA survey found, and nearly 17% of respondents reported “significant increases” to pricing because of the tariffs. One-third of respondents reported no changes to pricing yet.

Business was already ‘bumpy’

Retailers like Linn also are choosing not to raise prices for customers at a time when business is shaky. Business from Canadian tourists has basically disappeared, he said. Linn described business at City Bird and Nest this year as “wild,” “bumpy” and “rough.”

“Everyone is saying the same thing,” he said. “I think, unfortunately, it’s going to be really tough on all businesses, but maybe especially on small businesses that don’t have the resources to stockpile or to respond sometimes.”

Nearly 70% of retailers feel that tariffs will hurt their business in the next three months to a year, the MRA survey found.

“The inconsistency in which these tariffs are threatened and applied has created a very difficult environment for business owners,” William Hallan, president and CEO of the MRA, said in a news release announcing the survey results. “The week-to-week and day-to-day changes are hard for local retailers to keep up with. They’re busy running their stores and serving their communities, and they don’t have the same resources as larger stores.”

The few that aren’t impacted: Antique stores, thrift shops

However, the MRA pointed out that there are a few types of retailers that are benefiting from tariffs. Nearly 6% of retailers surveyed feel that the tariffs will positively impact their business in the next year.

The MRA pointed to vintage and antique stores, thrift shops and retailers selling handmade or local products that are “leveraging the fact that they’re not impacted by tariffs to drive more foot traffic to their stores.”

Still, even retailers like City Bird, which sells local products made or assembled in the U.S., are impacted by the tariffs because some of the parts that go into these products are manufactured overseas.

For example, City Bird produces a line of goods that it sells to about 150 stores in Michigan. Linn works with Midwest manufacturers to purchase thousands of items and then wholesales them to other stores.

“We’re finding that’s an area that’s been the most complicated,” he said. He said he sources printed glassware from a factory in Ohio that uses Ohio-made glass for their glasses. Traditionally, they would give Linn a quote that would be good for 60-90 days, and then he would turn around and offer a price to the stores that buy the glassware.