New tariffs set to go into effect March 4 are causing some concerns among the destination retail industry. One retailer in particular wanted to share with Seaside Retailer how he was handling the situation and offer advice for other destination retailers.
President Donald Trump announced on Feb. 27 that he would indeed be imposing 25% tariffs on Canada and Mexico and adding an additional 10% tariff on top of the 10% tariff that was already imposed on China in February.
Howard Aspinwall, owner of Mellow Monkey, located in the coastal town of Stratford, Connecticut, took the potential for tariffs into consideration while attending Atlanta Market in January to buy for his store for the year ahead and even posted reels about it on his social media pages which got him noticed by national media outlets.
“I just wanted to get the word out because small businesses are disproportionately affected by this,” says Aspinwall. “We don’t have the capital and the flexibility of bigger businesses.”
Aspinwall estimates approximately 80% of the merchandise he carries is made overseas. He does the majority of his buying for the year in January and February and placed orders at Atlanta Market with the understanding that if there were going to be surcharges then the order may be cancelled.
“I think that for the most part, I’ve been able to get my vendors to commit to the pricing for everything I placed at market, including some orders that I could place now with advanced ship and preserve that pricing through the end of the year,” he says. “We looked at our inventory and we planned it out with four different ship dates in 2025 in addition to what we already scheduled in Atlanta so that we have the inventory if we need it at the price that was pre-tariff.”
One of the categories he is particularly concerned with for the retail industry is holiday merchandise, which he notes is usually exempt from tariffs, but not this time around.
“If retail stores have to somehow absorb that cost, you’re going to see some pretty high prices on holiday merchandise this year,” he says.
Aspinwall started out as an online seller 13 years ago and opened up a small brick-and-mortar retail store in a warehouse 10 years ago that he says has blown up over the years, “eclipsing our online business.”
He doesn’t think that tariffs alone would be something that would cause a store to go out of business, but if a store owner was already thinking of retirement and was having trouble keeping up with social media, the addition of tariffs could be something that could be that final push toward closure.
He’s tried reaching out fellow retail store owners in nearby towns about the tariff situation but says there hasn’t been much response. “They are either not concerned or they don’t want to be part of the conversation right now,” says Aspinwall. He adds that while the conversation was not intended to be political, retailers are often reserved about sharing their political views since they don’t want to alienate their customers.
As for Aspinwall he just wants to get the word out to retailers that “you still have time to mitigate the risks of the situation.” He advises talking to vendors and getting out ahead of the situation.
He recognizes that U.S. product manufacturers are also going to be impacted by the tariffs because their raw materials often come from overseas.
He also questions what the tariffs alone are going to accomplish. “There’s no way a tariff is going to change everything because there has to be a plan on how you’re going to build manufacturing here,” he says.
He adds that he is concerned that “smaller retailers are just not going to have the business savvy, the resources or the experience to be able to navigate this and potentially try to absorb some of the costs when they are already operating under tight margins.” But he also wonders if the tariffs are going to stick if the administration is able to get what it wants from implementing them.
Consumers are also being more cautious with their spending which doesn’t help the situation, according to Aspinwall. He says some retailers in the area have reported some slower months in 2024 as well as slowness in January and February, though he notes January is usually a slow month for a lot of retailers.
Mellow Monkey’s social media presence has helped it maintain a strong customer base. “We do such a good job at advertising on social media. We’ve become a destination just because people are curious to see what is going on in this place,” says Aspinwall. “We are lucky in that regard being off of Main Street. People come in and they’re blown away because they can’t believe what’s inside our warehouse, but not everyone’s had that same experience in terms of sales.”
This isn’t the first time in 10 years that Mellow Monkey’s business prowess has been put to the test and it appears to be passing with flying colors.
“Ever since COVID was over we understood that experiences are what people are looking for because they want to get out of their house and do something,” notes Aspinwall. “If you are on a main street, you may not be getting people to come to your store or go shopping unless they absolutely need something but if you’re an experience, then you aren’t necessarily coming here to buy anything or that’s not your driving motivation. You’re really interested to see what this place is and of course once you come in – because this place is really packed with a lot of different things – you’re not leaving without buying something.”
