When President Donald Trump imposed tariffs on a wide range of imports—particularly from China—many of the headlines focused on national economic impacts: the trade war, Wall Street jitters, or international relations. But for small business owners across the United States, the story has been deeply personal, hitting their operations, employees, and communities in ways that statistics can only partially capture.
In Colorado, one small business owner’s experience has become a telling case study of how tariffs ripple through the economy and why these policies can have unintended consequences far from Washington, D.C.
A Business Built on Imports
Meet Sarah Martinez, owner of Rocky Mountain Outdoor Gear, a Denver-based shop specializing in high-quality backpacks, tents, and hiking accessories. Sarah started her business in 2014, driven by her passion for outdoor exploration and Colorado’s thriving hiking culture.
To keep prices competitive while maintaining durability, Sarah sourced much of her gear from overseas suppliers. Many of her backpacks, for example, were manufactured in China, where factories had the capacity to produce durable materials at relatively low cost.
For years, this arrangement worked well. Sarah’s shop grew steadily, attracting loyal customers ranging from college students planning weekend camping trips to professional mountaineers. By 2018, her store employed 12 people, and she was on track to expand into a second location in Boulder.
Then came the tariffs.
The Tariff Shock
In 2019, when tariffs of 25% were imposed on imported goods from China, Sarah’s business model was suddenly upended. A shipment of backpacks that used to cost $40,000 now cost $50,000 after tariffs.
“I remember looking at the invoice and feeling sick,” Sarah recalls. “This wasn’t just a line on a balance sheet. It was the difference between hiring another employee and letting someone go.”
The extra costs forced Sarah into difficult decisions: should she raise prices and risk losing customers in a competitive market, or should she absorb the costs and accept shrinking profits?
She tried both. Prices for some premium tents and backpacks were increased by 10–15%, while for staple items like sleeping bags, she kept prices steady, swallowing the higher costs herself. Neither option was ideal. Sales declined slightly due to higher prices, while margins plummeted on products where she tried to shield customers.
Impact on Employees and Growth
The human cost quickly followed. Instead of opening her second store in Boulder, Sarah shelved the expansion plans indefinitely. Worse, she had to cut hours for several part-time employees.
“Explaining to people who rely on you for work that you can’t give them the hours they need—it’s heartbreaking,” she says. “These are folks who believed in my business from day one.”
The tariffs also introduced uncertainty that made planning difficult. Sarah didn’t know whether new tariffs would be added, lifted, or changed. She likened it to trying to navigate a trail in the dark: “Every step forward, you worry there’s a cliff.”
Customers Feel the Pinch
While Sarah tried to protect her customers, the effects were unavoidable. Hikers who once bought new gear every season started stretching purchases out longer. Some switched to cheaper, lower-quality brands not subject to tariffs.
One longtime customer, an avid backpacker named John, explained: “I used to buy a new pack every couple of years. Now, I just repair the old one. It’s not Sarah’s fault, but prices are up, and I’ve got a family budget.”
The shift in consumer behavior trickled back to Sarah’s bottom line, reinforcing the downward pressure tariffs had created.
Searching for Alternatives
Not one to give up easily, Sarah sought alternatives. She reached out to suppliers in Vietnam and Mexico, hoping to diversify her sourcing and escape the tariff burden. While some options showed promise, the transition wasn’t simple.
New suppliers required new contracts, different shipping arrangements, and, in some cases, smaller businesses struggled to meet her quality standards. “You can’t just flip a switch and move your supply chain,” she explains. “It takes years of building trust and testing products.”
Moreover, global demand for non-Chinese suppliers skyrocketed once tariffs were in place, which drove up their prices as well. Even without tariffs, goods from other countries often cost more than Chinese imports used to.
The Broader Colorado Picture
Sarah’s experience is far from unique. Across Colorado, businesses that rely on imported goods—whether it’s machinery for breweries, components for tech startups, or fabrics for clothing companies—have faced similar struggles.
The Colorado Chamber of Commerce reported that small businesses were disproportionately hit because they lacked the financial cushions and lobbying power of larger corporations. For many, the tariff-related cost increases couldn’t simply be absorbed, and some were forced to shut down.
Economists at the University of Colorado estimated that tariffs cost the state’s businesses tens of millions of dollars annually, with ripple effects on employment, wages, and even local tax revenues.
Political Reactions
The tariffs also fueled political debates in Colorado, a state known for its mix of conservative rural areas and liberal urban centers. Some business owners supported Trump’s tough stance on China, arguing that short-term pain was necessary to protect American industries from unfair trade practices.
But for small business owners like Sarah, the rhetoric felt hollow. “I understand the need to stand up to China,” she says, “but I don’t see how punishing small American businesses helps.”
Colorado lawmakers across party lines voiced concerns. Democratic representatives pushed for tariff relief programs for small businesses, while some Republicans urged the administration to refine its trade strategy to protect entrepreneurs.
Lessons Learned
For Sarah, the tariffs have been a harsh but valuable lesson in resilience and adaptability. She has since invested more in locally made products, partnering with small U.S. manufacturers for some of her hiking accessories. While these items are more expensive, customers appreciate the “Made in Colorado” label, and it has helped carve out a niche market.
She also leaned into online sales, reaching customers beyond Colorado, which has softened the blow of reduced foot traffic in her Denver store.
Still, the experience has left scars. “We survived, but it changed the way I think about business forever,” Sarah admits. “I no longer assume stability. I plan for the unexpected because, as the tariffs showed, everything can change overnight.”
The story of Sarah Martinez and Rocky Mountain Outdoor Gear illustrates the profound impact tariffs can have on small business owners. What may begin as a trade policy aimed at foreign governments ultimately lands hardest on entrepreneurs, workers, and communities thousands of miles away.
For Colorado, a state proud of its entrepreneurial spirit and outdoor lifestyle, the tariffs have been more than an economic policy—they have been a daily reality reshaping how people do business.
Sarah’s story is both a warning and an inspiration. It highlights the vulnerability of small businesses to global politics but also their resilience and creativity in the face of adversity. As the nation debates the future of trade policies, one truth remains clear: the voices of small business owners must be part of the conversation, because they are the ones living with the consequences every single day.
