Small businesses face "Made in America" pressure
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Illustration: Lindsey Bailey/Axios
There has never been a better time for businesses that manufacture goods in America.
- But there has never been a worse time to sell such products overseas.
Why it matters: "Made in USA" brands have been touted as the nation's trade war winners. Yet even those that don't rely on tariffed materials from abroad are taking a hit.
- The trade war has ignited new waves of economic nationalism across countries like Canada, whose citizens are loathe to purchase American brands. This is part of the nuanced story about how domestic producers are faring, even as trade tensions ease.
What they're saying: "No one wants 'Made in USA' anymore," Pepper Harward, chief executive of footwear retailer Oka Brands — which partners with other big brands, including New Balance and Walmart — tells Axios.
- "Canada, South Korea, Japan, all those markets have softened. That was real business for us," Harward says. Most of his customers are domestic, business he describes as "ok, not great."
The big picture: Trump officials say the administration's tariff policy is aimed at making more businesses like Oka. And yet most American small businesses are not like Oka. Even many that make goods in the U.S. rely on foreign inputs.
- That has benefited a subset of manufacturers whose higher-priced and domestic-made goods look more competitive. But the uncertainty eats away at any upside, and as tariffs fade, so do any tailwinds.
Flashback: When Axios spoke with Harward earlier this month, he said that "popular" was the best way to describe himself. There was huge demand from other retailers for the inputs produced in the U.S. at Oka's factory in Georgia.
- "There is a lot of desperation out there, my phone is ringing off the hook. It's super busy," he said. "They have stuff tied up in China and looking for short-term solutions."
Harward predicted that very few of those business opportunities would actually manifest into sustainable partnerships.
- "We would be buried by selecting the wrong partners or trying to do things out of their desperation. I am confident that 90% of this business interest will go away as soon as tariffs are gone," he added.
The bottom line: The inbound requests have slowed since tariffs on Chinese goods were cut to 30% from 145%, Harward noted.
- "People are less interested. People are already talking about going back to the new normal," he said. "Just like that. That quickly."
