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How the 25% US Tariff will affect your Toronto Business

  • Writer: Kirill Anikin
    Kirill Anikin
  • Mar 4
  • 4 min read

US tariffs act as a financial burden on imported goods, significantly affecting Toronto’s business landscape. Knowing their origins and economic implications is crucial for business owners looking to navigate this evolving trade environment.


US Tariff will affect your Toronto Business


Top 10 Things Toronto Business Owners Can Do About US Tariffs:

  1. Choose Canadian Suppliers:

    • Look for companies right here in Canada that sell the materials you need. Supporting local businesses helps everyone.

  2. Choose Canadian Products:

    • Whenever possible, use Canadian-made products. This reduces your reliance on imports and strengthens our economy.

  3. Find New Suppliers (Diversify):

    • Don't just buy from the US. Look for companies in Europe or Asia that sell the same things. This gives you more options and less risk.

  4. Talk to the Government:

    • There are programs to help. Contact Export Development Canada (EDC) or other government offices. They might have money or advice to help you out.

  5. Change Your Contracts:

    • Talk to the people you buy from and sell to. See if you can change the prices or how you pay. Every little bit helps.

  6. Cut Costs:

    • Look for ways to save money in your business. Maybe you can use less energy, buy cheaper supplies, or find a less expensive office.

  7. Tell Your Customers:

    • Explain why prices might be going up. Honest communication builds trust.

  8. Stay Informed:

    • Keep up with the news about trade. Things can change quickly, so knowing what's happening is important.

  9. Join Business Groups:

  10. Look for New Customers:

    • If you're having trouble selling to the US, try selling to other countries or more customers within Canada.

  11. Be Flexible:

    • The business world is always changing. Be ready to try new things and adapt to new situations.

  12. Focus on Quality:

    • No matter the economy, if you produce a good product or service, people will still buy it. Focus on being the best you can be.

The Foundation: Section 301 Tariffs

These tariffs stem from Section 301 of the US Trade Act of 1974, which allows the US government to impose trade restrictions on countries engaging in unfair practices. While initially targeting China, Canada has also been affected due to its deep trade ties with the US. Key industries such as manufacturing, technology, and food have been particularly impacted.

The Purpose: Protectionism vs. Economic Reality

The US imposed these tariffs to protect domestic industries and promote fair trade. However, while some sectors in the US have benefited, Canadian businesses are facing rising costs, supply chain disruptions, and increased competition.

25% US Tariff on Industries Most Affected in Toronto

The effects of US tariffs are not uniform—some industries are bearing the brunt more than others.

Manufacturing & Automotive: Rising Costs and Supply Chain Strain

Toronto’s manufacturing sector heavily relies on cross-border trade. Tariffs on essential components like steel, auto parts, and machinery have increased production costs, making it harder for local businesses to compete.

Technology & Electronics: Innovation at Risk

Toronto’s booming tech industry depends on global suppliers for electronic components. Increased costs due to tariffs have made innovation more expensive and complicated for both startups and established firms.

Food & Beverage: Higher Prices for Consumers

The food industry is also feeling the pressure, with higher tariffs on agricultural and processed food imports driving up costs for restaurants, grocery stores, and food manufacturers.

The Ripple Effect: How Tariffs Drive Up Costs

US tariffs don’t just impact businesses—they have wider economic consequences.

  • Supply Chain Disruptions & Rising Material Costs: Businesses must find alternative suppliers, leading to higher costs and potential delays.

  • Higher Consumer Prices: Increased production costs are often passed down to consumers, impacting spending and economic stability.

Strategies for Mitigating the Impact of US Tariffs

Despite these challenges, Toronto businesses can implement proactive strategies to adapt and thrive.

1. Diversifying Supply Chains: Reducing Dependence on the US

Businesses can explore alternative suppliers in Canada, Europe, and Asia to lessen their vulnerability to US trade policy changes.

2. Leveraging Government Support

Government agencies like Export Development Canada (EDC) provide financial assistance, insurance, and advisory services to help businesses adjust to trade disruptions.

3. Renegotiating Contracts & Cost Management

Businesses should engage with suppliers and customers to renegotiate pricing, explore cost-saving measures, and increase operational efficiencies.

Looking Ahead: Preparing for Future Trade Policy Changes

The future of US-Canada trade remains uncertain, but businesses can take steps to prepare for potential shifts.

  • Staying Informed & Agile: Trade policies can change rapidly. Keeping up with updates ensures businesses can react promptly.

  • Building Long-Term Resilience: By focusing on innovation, efficiency, and strong customer relationships, businesses can weather economic fluctuations and maintain growth.

Conclusion: Adapting to Challenges and Securing Long-Term Success

While US tariffs present challenges, Toronto businesses can overcome them by diversifying supply chains, leveraging government resources, and optimizing operational strategies. With resilience and adaptability, they can not only survive but thrive in an ever-changing global trade environment.

Why Seacliff Capital?

At Seacliff Capital, we specialize in helping businesses navigate financial challenges, secure funding, and develop strategies to mitigate economic pressures. Whether you need working capital, supply chain financing, or expert advisory services, we’re here to support your growth. Contact us today to explore customized solutions for your business.

Seacliff Capital offers a range of services, including:

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