Possible tariff causing uncertainty for Greater Cincinnati businesses

Posted at 6:07 PM, Jan 27, 2017
and last updated 2017-01-27 18:09:03-05

LINCOLN HEIGHTS, Ohio -- American companies import billions of dollars worth of goods every year under negotiated trade policies. However, the possibility of increased tariffs or new trade deals is causing a lot of uncertainty.

Many Greater Cincinnati companies are very concerned about the trade and tariff talk coming from President Donald Trump in Washington, D.C. That's especially true at VESI Inc. in Lincoln Heights.

VESI's embroidery production line works at "warp speed" each day to crank out shirts and jackets for 300 colleges and universities across the U.S. The basic apparel comes from Asia, according to company co-founder Greg Visconti.

"On an annual basis, we probably import around a couple-hundred-thousand garments or units," he said.

Apparel makers already pay tariffs between 17 and 35 percent, compared to an average 2 percent for most industries. So, something like a 20 percent hike on items from Mexico could be "huge," according to Visconti.

"I mean, all of a sudden consumers are going to start paying 20 percent more for all the apparel," he said. "I believe you'll see a cutback on the units purchased, which means a cutback on the jobs here in the states."

At Pet Wants in Findlay Market, all of the food sold is made in Ohio, but the delivery bags are made of jute and important from India and Bangladesh. Founder Michele Hobbs said they couldn't find anyone in the U.S. to make what they wanted.

"We needed something that had a zipper on it. We needed a handle on it. It needed to be printed and have a food-grade rating. It wasn't available here," she said.

The bags have been a hit, and the supply chain is in place. But there's uncertainty about how the final version of any new or renegotiated trade deals might impact the business.

"It's not like we can go say, 'Our price went up, we're going to raise the price of the bags.' It's not like that," Hobbs said. "We will absorb any additional costs. And, for a small business in a small community, costs are really important."