By now, you’ve heard about the Donald Trump administration’s tariffs that went into effect Tuesday morning. To recap the details, there’s a 25% duty on goods from Mexico and Canada, plus an additional 10% tariff on Chinese imports. That’s on top of the tariffs slapped on China about a month ago. 

Now the back-and-forth beginnings of a potential trade war have begun. Canada plans to impose tariffs on American goods like alcohol, clothing and appliances. China announced tariffs on chicken, wheat and other agricultural items. Mexico said it plans to retaliate too. 

When it comes to trade, a lot may change in the coming hours, days and months. But we wanted to take stock of this moment and what it’s like to be a business owner right now. 

Paul Weismann, president of Healthy Avocado, imports more than 1 million boxes of avocados a year. The industry has been a little touch and go lately, he said, even before tariffs. Supplies from Mexico have been down because of bad weather. 

“The prices for Super Bowl were twice what they were last year,” which impacted sales, Weismann said.

It makes him wonder if people have already reached the price threshold for guacamole.

“Will consumers pay $3 or $4 each for an avocado? I don’t think so,” said Weismann. 

Mexico is the biggest supplier of the fruit. So all he can do is wait to see how tariffs impact prices and how farmers react. 

Erica York, vice president of federal tax policy at the Tax Foundation, said the cost of tariffs is a big factor for businesses and consumers. But perhaps a bigger consequence for the economy is the uncertainty of trade policy.

“That itself has a negative impact on business investment, on business activity,” said York. “If you’re a business trying to plan a long-term investment, you’re going to sit on your hands.” 

York said even if a trade war doesn’t emerge — and even if, say, Trump reversed these tariffs — they’ve created friction for companies across borders.

“These are business relationships that have developed over years. We don’t really see them snap back into place overnight,” she said.

This is the main worry for Chip McElroy, president of McElroy Manufacturing in Tulsa, Oklahoma. Many of the components he uses to make construction equipment come from Canada and Mexico. That’s also where most of the finished equipment he exports ends up. He thinks retaliatory tariffs might make his customers look elsewhere. 

“There is an influx of Chinese equipment that is substandard to what we provide, but is, well, let’s just say Chinese-priced,” McElroy said.

While he waits to see how it all shakes out, he’ll be doing some component pricing. “Job 1 is to gain some clarity on what actual impact these tariffs are going to have,” he said.

That way, he can quantify the new cost of thousands of components that go into one piece of equipment.