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Key Takeaways:
Tariffs have seriously disrupted operations for nearly 1 in 4 businesses, with 18% reporting a major disruption and 5% saying they're an existential threat to their business.
Businesses spend an average of 10% more per month on goods, materials, or operations than they did at this time last year.
Businesses have raised prices an average of 5% due to tariffs.
Over 4 in 10 businesses (42%) have low confidence in their ability to financially withstand another round of tariff increases.
Rising tariffs have influenced nearly 1 in 5 businesses (18%) to launch a new business or pivot an existing one.
Only 11% of businesses have built a financial "tariff buffer" into their planning.
More than 1 in 10 businesses (12%) are downsizing to manage increased costs due to tariffs.
Tariffs Reshaping Daily Operations
Businesses are feeling a serious pinch that is reshaping how they operate.
Nearly a quarter of business owners reported major disruptions due to tariffs, and 5% said they threaten their survival. On average, businesses spend 10% more each month on materials and operations than a year ago.
To cope with tariffs, many are adjusting their pricing. Over a third (35%) raised prices, while 31% absorbed the costs. Over 1 in 4 businesses (26%) increased prices by 10% or more to match their increased spending.
Others have delayed investments, switched suppliers, or turned to domestic sourcing. Nearly 1 in 5 businesses (18%) have lost key supplier relationships due to tariff-related pressures. Just 4% sought new financing to bridge the gap.
Over half (51%) of business owners said tariffs have made them feel less in control of planning for the future. The most affected industries were transportation, finance, tech, retail, and real estate.
Founders Feeling Financial Strain and Adapting
Many entrepreneurs are facing uncertainty head-on, but their confidence is wavering.
Forty-two percent of business owners expressed low confidence in their ability to handle another round of tariff hikes. In response, 31% have postponed equipment investments, while others have planned to delay hiring, marketing, or renovations.
Some are choosing to stay the course. Over a third (35%) said their industry is maintaining the status quo, but 26% have shrunk operations and 9% pivoted or launched something new. The industries least confident in surviving further tariff impacts include real estate, retail, entertainment, hospitality, and tech.
A few businesses (11%) have been able to set aside a specific "tariff buffer" in their budgets, dedicating 5% to supply chain diversification or resilience.
Rising Costs Fueling Entrepreneurial Reinvention
Some founders are turning today's trade turmoil into tomorrow's opportunity.
About 18% of businesses said tariffs have motivated them to start something new or change direction. These pivots were not cheap: On average, businesses spent $20,000 to adjust their strategy.
How did they fund these changes? Most relied on personal savings (57%), followed by business credit cards (32%) and small business loans (25%). Others turned to family or friends, investors, or revenue-based financing.
As for the return on investment (ROI) of the tariff-driven changes, 48% said it's too soon to tell. One-third expected minimal returns, while just 2% were counting on significant long-term growth.
A New Era of Risk and Resilience
Tariffs are raising costs and shaking confidence, but also driving entrepreneurial grit. Whether it is launching a new business or shifting to domestic suppliers, small business owners are adapting fast. For some, uncertainty has become the catalyst for reinvention and that may be the key to staying competitive in a volatile global economy.
Methodology
We surveyed 250 business owners to explore how trade-related disruptions are shaping their business plans. The average age was 48; 57% were female, 41% were male, and 2% were non-binary.
About Clarify Capital
Clarify Capital helps small businesses adapt to change with funding solutions tailored to every stage of growth. Whether you are pivoting your model or scaling up after a successful shift, Clarify offers no-doc business loans and fast business loans to keep things moving. Built for entrepreneurs, Clarify is here to help you move forward, no matter what trade winds blow your way.
Fair Use Statement
We welcome the sharing of these findings for noncommercial purposes. If you reference or republish any content, please link back to Clarify Capital with proper attribution.
Emma Parker
Senior Funding Manager
Emma holds a B.S. in finance from NYU and has been working in the business financing industry for over a decade. She is passionate about helping small business owners grow by finding the right funding option that makes sense for them. More about the Clarify team →
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