Tariffs: How they will Affect your Business

Written by Sarah Dodrill | Jul 11, 2025 2:00:00 PM

Tariffs are a tax imposed by one country on goods and services imported from other countries. With the 10% tariff imposed by the United States, many US businesses are wondering how it will affect their business and vendors.

Types of Tariffs:

  1. Ad valorem tariffs – this tariff type is calculated as a proportion of the price of the good or service being imported.
  2. Specific tariffs – are imposed as cost per unit (or weight/volume).
  3. Compound tariffs – are a combination of the ad valorem and specific tariffs, imposing a unit cost and proportion of the price.

Purposes of Tariffs:

  1. Revenue tariffs – are aimed at raising money for the importing country.
  2. Protective tariffs – are aimed to support domestic businesses.
    a. Protective tariffs are usually imposed as a response to another country’s tariff. 

Why Countries Impose Tariffs?

  • To decrease unemployment
  • To raise revenue for the country 
  • To ensure important industries can survive

Benefits & Disadvantages of Tariffs:

Benefits  Disadvantages 
Protection of domestic industries as there will be less competition for domestic goods. Costly imports.
Increased revenue for the government. Trading partners retaliating with tariffs will increase export costs.
National security as the country becomes more self-sufficient for goods.  Domestic industries can become inefficient with less competition.
Addresses market distortions by helping level the playing field for domestic producers. Hurt domestic consumers with the lack of competition, increasing costs and decreasing variety and quality.
Encourage fair labor and environmental standards by imposing higher tariffs in countries with poor work conditions. Create tension by favoring certain industries or locations (for example, the US imposing a 30% tariff for imports from China but only a 10% everywhere else).

 

Business Impacts:

  1. Increased costs for the business and potentially the customers.
  2. Supply chain disruptions as some businesses seek alternative suppliers to avoid tariffs.
  3. Competitive dynamics will shift as countries with lower tariffs try to capitalize on their competitive edge and retaliatory tariffs are imposed.
  4. Strategic adaptations will need to be made as vendor pricing shifts because tariffs discourage investments and long-term planning.

While many businesses will face changes due to the tariffs, your technology dealer will need to fully shift. For example, our vendor Ricoh, is moving their operations center out of China to avoid the 30% tariff. Not all businesses and industries will have that luxury, resulting in an increase in costs for the business or the customer. 

Sources 

"The Real-World Impact Of Tariffs: What Businesses And Consumers Should Know" 
https://www.forbes.com/councils/forbesfinancecouncil/2025/06/02/the-real-world-impact-of-tariffs-what-businesses-and-consumers-should-know/ 
"US Tariff Rates by Country"
https://passportglobal.com/us-tariff-rates-by-country-2025/ 
"Pros and Cons of Tariffs"
https://prosancons.com/tax/pros-cons-tariffs/ 
"What are Tariffs and How do they Affect your Business?"
https://www.profit-trust.com/blog/what-are-tariffs/ 
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