As the US-UK trade tensions escalate, small business owners in Britain are bracing for the potential impact of President Donald Trump’s tariff threats. The prospect of increased tariffs on goods imported to the US has left many entrepreneurs worried about the viability of their companies.
Martha Keith, the founder and CEO of Dorset-based stationery business Martha Brook, is one of those concerned. She says the 10% tariffs introduced last year had a “huge impact” on her company, with sales on platforms like Etsy dropping by 50%. Now, the looming threat of a further 25% tariff from June has left her “heart sinking again”.
“What happened last year had a huge impact on us. When I read the news at the weekend, my heart sank again,” Ms Keith told The Update Desk. “Even the threat of higher tariffs and speculation surrounding them impacts business, as it hits consumer confidence in the States.”
Prime Minister Keir Starmer has urged calm, warning that a trade war would “benefit nobody” and could potentially plunge the UK and EU into recession, costing the British economy up to £22 billion. However, the uncertainty is already taking a toll on small firms like Martha Brook.
“It’s absolutely something that threatens the future of a business like ours,” Ms Keith said. “We’ve come into this year really thinking about how we can do things differently and innovate. It’s genuinely not sustainable to continue to operate without changing the way that we do things.”
The tariffs have compounded the challenges already faced by British businesses, from the impact of Brexit to the coronavirus pandemic. According to the British Chamber of Commerce, the new tariffs will be “more bad news for UK exporters, already struggling with the tariffs levied last year.”
Michelle Ovens, chief executive of Small Business Britain, warned that any further tariffs would “create significant uncertainty” for companies across the country. Government data shows that while just 17% of SMEs (small to medium enterprises) export, they account for almost half (44%) of the UK’s exports to the US.
“This makes small businesses a critically important part of the conversation and particularly sensitive to sudden changes in trading conditions,” Ms Ovens said.
For Martha Keith and other small business owners, the fight to keep their companies afloat has become even more challenging. “Small business owners are very resilient, but this is really testing the resilience,” she said. “It feels very frustrating, and it has had a demonstrable financial impact on our business already.”
As the UK and US navigate the complex web of trade negotiations, the future of many British small businesses hangs in the balance.