A number of news headlines online are about how the current trade dispute of the U.S. with China is hurting small businesses. For instance, the Washington Post warned it “could be catastrophic” for small businesses.
However, Gene Marks, founder of The Marks Group, a small-business consulting firm, does not agree with the Washington Post. While there may be some short term challenges, a survey of 1,500 small business owners by Bank of America shows that most small businesses are not affected by higher tariffs that China may impose.
Fifty-nine percent of those respondents said they “don’t see any impact.” A recent survey by brokerage site BizBuySell of 1,700 small-business owners had a similar result – 57 percent said they weren’t affected by the China tariffs.
The reason is that most of the 30 million small businesses in this country sell pizzas, fix cars, repair roofs, balance books and mow lawns. These are not people who care about China.
According to Marks, those small businesses that are affected have demonstrated their ignorance because they’ve mostly relied on just one or two suppliers from one country (China). Or, they’re farmers exporting to China who did not look for other buyers even though Donald Trump has been warning for years what he’ll do if and when he becomes president. Ultimately the smart ones will survive, learn and grow. And they’ll ultimately benefit from this experience.
If the U.S gets its way in this dispute, it will also stop the decades-long complaint of small and medium-sized businesses that doing business with China has been patently unfair.
If the U.S. prevails in the dispute, some of the things small business owners can expect are a more-level playing field; greater opportunities for small manufacturers to make stuff for the American market; less illegal dumping of Chinese products that kill American suppliers; a reduction of cyber-espionage that steals U.S. data and intellectual property and no more joint venture “partners” that are required when one wants to do business in or with China.
Small businesses that are facing challenges right now can learn valuable lessons from the experience.
The smart ones will diversify their market or deal with multiple suppliers. They will not put all of their eggs in one basket. Better yet, more will likely do business at home. The smart business owners will figure things out and be better off from it.