April 28, 2025 • 47 mins
Callers across the country share their stories about how the Trump tariffs are hurting their businesses and costing them money.
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Episode Transcript
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Speaker 1 (00:02):
So the International Monetary Fund just announced that California is
the fourth largest economy in the world. Only Germany and
China in the United States have a larger economic output
than the state of California. That's the good news. The
bad news is there's no state in America that is
more impacted by uncertainty and these tariffs imposed unilaterally by
(00:25):
Donald Trump and the Trump administration. The impacts of that,
of course, are felt small businesses, medium sized, large businesses, consumers,
as well as supply chains, not just in our state,
but all across this country and around the world. So
today we'll be exploring the impacts, real life impacts on
real people, impacts and states large and small, from Montana
(00:48):
to Minnesota to here in the great state of California.
Tune in to this live program on the impacts of
Donald Trump's tariffs in America. Is Gavin Newsom. Let's talk tariffs.
Speaker 2 (01:03):
Hey, Bath, I am trying to get my phone turned off.
I just got this phone. I don't know who to
do it.
Speaker 1 (01:08):
What is an Android or an iPhone?
Speaker 3 (01:11):
It's an iPhone, but it's the new one.
Speaker 1 (01:13):
Good. It's smart to buy it now and not in
a few months when it's twice the price.
Speaker 3 (01:17):
Won't be twice the price they're exectly from tariffs.
Speaker 1 (01:19):
That's right, because they made a phone call crony capitalism, Beth,
that's a whole nother conversation, Beth, Thanks for joining us.
And you're in Minnesota. Where are you exactly in Minnesota?
Speaker 2 (01:32):
I am in southeast Minnesota's and Broda, fifty minutes south
of the Twin Cities.
Speaker 1 (01:37):
And tell us a little bit about your business and
when you started it and the impacts of these tariffs.
Speaker 3 (01:41):
Yeah.
Speaker 2 (01:42):
I started my business eight years ago, right after my
son was born. I had an idea for a baby
product that solves a problem all new parents have of
babies just dropping and throwing all their stuff. I made
what I now know to be a prototype for myself
and one of my friends who had a baby, and
she forgot it and said, you should make this thing
for real, because I didn't realize how awful it was
until I didn't have your matte thingy. So I invented
(02:04):
the busy Baby matt It's just a silicon place mat
that suctions to the high chair and has tethers that
you can use to attach.
Speaker 3 (02:10):
Babies baby's things.
Speaker 2 (02:13):
Since that time eight years ago, I was able to
go on Shark Tank and show the world my invention.
And from that I was able to tell my brother
to quit his job and join me in the business.
Speaker 3 (02:26):
And two of us have exbanded.
Speaker 2 (02:28):
The product line now to eight products that all have
the same mission, keep baby things within reach, off the ground,
at home and on the go.
Speaker 1 (02:34):
I love it. And you source your products from where?
Where do you get the materials? Where do you get
most of your supply?
Speaker 3 (02:40):
Yeah, we are one hundred percent in China, one hundred percent.
Speaker 1 (02:43):
And did you look around? I mean, was it China
first or it just where it's sort of the dominant
manufacturing occurs.
Speaker 2 (02:50):
No, we actually tried for a year and a half
to manufacture in the US, and there's a lot of
obstacles to that. One is the raw material is not
sourced in the US, so that has to be imported.
We learned this morning. We've been continuing to find ways
to manufacture in the US and had a great meeting
this morning with a silicon manufacturer here in New York,
and we're still learning more. It's still not viable for us. However,
(03:13):
we're continuing to try. But the main obstacle is when
you have a startup, when you are brand new. We're
not making twenty thousand units. We're not making two hundred
thousand units, or many companies a million units. I was
trying to get two thousand units because this was a product.
Speaker 3 (03:30):
That never existed before.
Speaker 2 (03:31):
I didn't even know if people were going to buy
this item. I knew it was a good idea, but
I didn't know if my fellow Americans would think it
was a good idea. So there were no American factories
that were willing and able to do this project on
such a small scale to start, so we did have
to start in China.
Speaker 3 (03:48):
They were willing to do that with us.
Speaker 1 (03:51):
And so the impacts are immediate. The one hundred and
forty five percent tariffs, I mean, I mean, what has
that meant? I mean, is there sort of a dollar figure?
Do you recall that first invoice purchase order? Came back
and looked at that delta, and how do you respond?
Speaker 3 (04:06):
You know, it's more immediate than that. I could literally
lose my home.
Speaker 2 (04:09):
In less than three months, So I'll walk you through
that real quick. This last six months has been amazing
for US. I got a contract with Walmart. I got
a contract with Target. We're in both stores now. Minnesota
awarded me SBA Small Business Person of the Year. It's
been a really sunshiney last six months. I booked my
(04:30):
flight with my eight year old son to take him
to DC to get this award on May fifth, and
then nine days later, as my products were two day
shy of being picked up to put on a container
to come to the US, these tariffs came out. The
announcement came out. So what I was expecting to pay
twenty maybe thirty thousand dollars worth of tariffs, that's what
(04:52):
I budgeted for now is going to cost me two
hundred and thirty thousand dollars to bring into our country.
I have made maybe two months worth of inventory left
in in my warehouse here, and when that has gone,
I have no more revenue. I have no money coming
in to pay my employees. I have no money coming
in to pay my bills, the other American businesses that
(05:13):
I support through my company, my marketing teams, my bookkeeping,
my accounting, everyone who helps me run this business, all
American companies, my transportation team that was going to bring
that container to me. I can't pay any of them anymore.
And the worst thing is I can't pay my loan.
And when I got the contracts for Target and Walmart,
(05:34):
I took a big, big business risk, and a lot
of us small businesses do this. I leveraged my home
to be able to buy the inventory to support these
contracts because that was the next big milestone step in
our business. And now I am at grave danger of
not being able to get my products here, not being
able to continue to sell and have the cash flow
(05:56):
that I've counted on, and not be able to pay
on those loans, which means I could lose my house
where my children live and my ability to keep them
safe and feed them.
Speaker 3 (06:10):
That's how real this is for me in this moment.
Speaker 1 (06:12):
I mean, boy, I mean, you paint the ultimate picture.
I mean, just the deep reality. And you know in
the fact that it was because of your kids that
inspired this business in the first place, and now your
home is a risk. Everything about that is an extraordinary
picture paint of the pain and anxiety that you're going through.
(06:33):
I mean, and forgive me. I mean the options for
you are what then right now? Do you called Walmart
back and Target and you say can you help? Are
there is there a strategy there so they float, you know,
ninety day invoices or something. I mean, is there a
strategy that you can see an alternative if this continues.
Speaker 2 (06:55):
Right now with those retailers, I actually have their inventory here.
That's why I had to take that big risk early on,
was you have to order the products in bulk so
that I have them here. So every week when they
place their order, I have something to send them. So
currently their product is here. That should support us six months.
With those retailers, I did have the opportunity to expand.
Walmart wanted to take on another product this year in November.
(07:17):
I had to call my buyer and say, I don't
know if I can do that right now. As of
right now, I cannot add another item. I cannot expand,
and because of the situation we're in, if I can't
get my products here, I'm going to have to just
sell the products that I have set aside for Target
and Walmart just to get some revenue in the door
to keep paying my employees. So Walmart's been great. They
(07:40):
have offered to you know, let's just see how this goes.
Speaker 3 (07:43):
We'll be patient.
Speaker 2 (07:44):
You know, they're not going to push the timelines that
normally they're very strict to with suppliers. Let's just kind
of see how this goes for a little bit. And
you know, they kind of said, we got you, we'll
figure it out.
Speaker 1 (07:54):
So what did you? And I'm curious, just you know,
and I don't mean this to be political, it's but
when Trump was elected, he talked about these tariffs on China.
Obviously his first first term he advanced tariffs on China.
So you must have anticipated something, But did this come
(08:15):
as a complete shock How quickly this happened, the level
of the tariff, meaning how large it was, give me
a sense of how you prepared a little bit over
the course last few months.
Speaker 2 (08:24):
Yeah, Prior to this administration, we didn't pay a tariff. Ever,
in my eight years in business, we've never paid a tariff.
We pay taxes, we pay duty, we have never paid
a tariff for baby items. When the administration came in,
knowing that they had talked about bringing in tariffs, we
expected a reasonable tariff twenty to maybe thirty percent, and
we looked at our numbers and decided we can we
can support that. It's going to be tough, but we
(08:46):
can stay live and support that we budgeted for. That
we did not budget for one hundred and forty five percent.
Speaker 1 (08:53):
No, I mean it, no one can, No one can. Well, Beth,
I can't impress upon you how grateful I am that
you had the courage to come on the show and
thank you for showing up, and not just for yourself
and your family, for your eight year old and your
brother and your employees, but for others in your circumstance
and your position. I think you know, all of us
(09:15):
out here in California, we're not only rooting for you,
we have your back. We initiated a lawsuit to push
back against the Trump administration. I mean, even on the
in the conservative side, the Koch Brothers are aligned in
that as it relates to the how thisnilateral action by
Donald Trump is simply illegal, and so we're serting ourselves
(09:36):
very aggressively in that space. So you can get some clarity.
But I'm curious, just you know, as you look out
over the course of the next days and weeks, with
all that anxiety in your house looming over this conversation,
I mean, you've got a week or how many weeks,
how many months do you think you can hold on
with this level of uncertainty before you just have to
(09:57):
make a real decision that may be sort of closing
up shop, so to speak.
Speaker 2 (10:02):
There's no closing up shop for me. I am a
tenure army veteran. I am not a quitter. I am
one who adapts and overcomes. We've got about two weeks
until we need to make critical decisions where we now
out we'd sell to other countries.
Speaker 3 (10:16):
We babies are everywhere.
Speaker 2 (10:17):
We've lined up some distribution in Australia, in Dubai, in
South Korea, and Canada. That if if we don't have
a resolution in two weeks where we can bring our
products to the US and sell to our fellow Americans,
then we're going to have to, you know, make that
decision to sell outside of our country, which is going
to be much more difficult for us. It's all unknown
(10:39):
to me. I've had to learn this business from scratch,
and now I need to learn international distribution like this.
Speaker 3 (10:45):
But I'm up for the challenge if I have to.
But what I really need is I need our.
Speaker 2 (10:53):
Representatives to stand up for us and stand up for
Americans in my district. I have a Republican congressmen who
will not even talk to me. And I was at
I just watched your podcast with my governor that you
recently did, and I was actually at the Capitol this
week for Governor Walls's State of the State address, and
(11:17):
what I saw broke my heart and has me just
feeling so depressed because we need our politicians to stand
up for Americans. When Walts was talking about the achievements
of our state in the last year, and one of
them in Minnesota is free breakfast and free lunch for
our students because science has shown wealth had kids have
(11:39):
better outcomes.
Speaker 3 (11:40):
This is a great thing.
Speaker 2 (11:42):
One half of the room was standing and clapping. The
other half of the room was sitting cross armed with
ugly faces. And I saw the opposite thing on the
President's State of the Union address, where one side is
clapping and the other side is pouting.
Speaker 3 (11:54):
And right now, we don't need that.
Speaker 2 (11:56):
We need our representatives to come together for Americans. We
need Americans to come together. I am feeling so much
hate from my fellow Americans who think that because I
make my products in China, that I am evil and
that I deserve to fail. And where we learn things
in our lives, you know, my children. I'm trying to
(12:18):
teach them kindness, I'm trying to teach them love. They
learn from me as an adult. We learn from our
bosses and from our leaders. And right now, what we're leading,
what we're learning from our politicians is to be divided,
to be hardline one way or the other. And if
I'm on this side, I can't possibly celebrate something accomplished
on the other side. And now the American people who
(12:39):
should be coming together and supporting one another and loving
one another. I had a woman tell me on TikTok
that I am going to fail and I deserve it.
No one deserves to fail. No one deserves to lose
their house, the roof over their children's home, no one.
And so you know, I need our politicians to come
together and support the Americans and stop fighting each other
(13:02):
and work together for the American people.
Speaker 1 (13:05):
I personally love that in ways you don't even fully
perhaps appreciate. My first three guests on this podcast. We're
all conservatives, that we're all supporters of Trump, and I
made exactly the point you just made. At the end
of the day, we all want to be protected, connected, respected.
We can't continue to continue talk down to each other,
past one another. We're all in this together, we're all
(13:27):
better off. We're all better off. So I readly. I
appreciate that sentiment. I appreciate you have no I'm an entrepreneur.
I love love your entrepreneur passion. The fact you're putting
everything on the line and putting human face on this
topic is inspiring. And I ain't worried about you failing that.
(13:48):
You got that gene, you got that grit that defines
the best. So thank you Beth for joining us.
Speaker 3 (13:53):
Yeah, thanks for letting me use my voice to stand
up personal businesses.
Speaker 4 (13:57):
You're here.
Speaker 1 (13:58):
We appreciate you.
Speaker 5 (14:04):
Hey, Jennifer, good morning, Governor.
Speaker 1 (14:07):
Where are you? What's that background? I love it? Oh fabulous.
Speaker 5 (14:10):
I'm in my restaurant. I live and own and operate
a restaurant in Crescent City, California, which is up in
Dilnark County. I believe you visited last about a year ago,
up in this region.
Speaker 1 (14:21):
I used to go up there as a kid with
my father, and one of the great gifts last year
is bringing my four kids up there and walking in
the same footsteps as I walked as a young child.
There are a few places anyone listening. There are a
few places on planet Earth that are more spectacular than
(14:41):
where you operate your restaurant. The absolute physical beauty is extraordinary.
And so I love it up there, and I appreciate
you're running a restaurant up there which is in and
of itself amazing and remarkable. And I imagine with all
of the uncertainty and announced mins and we just saw
some new tourism numbers already coming in that show a
(15:06):
decline in tourism across our state, that these tariffs have
in an impact on your business.
Speaker 5 (15:15):
Yes, so in the area, just so the listeners know
where I live. We're up at the very top coastal
corner of California, extremely remote, extremely rugged and rural, of course,
and this area is historically economically depressed. We get injections
of money into this area primarily through tourism. It is
(15:39):
one of the driving forces. And so most of the
businesses in this entire county get You know, we have
booming summers where our population with tourism increases exponentially. Our
town population is only seven thousand, the entire county population
is twenty seven thousand. I mean, very sparsely poppedup related.
(16:00):
We have a lot of trees and rivers, not a
lot of people. And in the summer, in July, our
town population can go up to thirty thousand with people
coming to explore the beaches and so forth. So those
tourism dollars are what keep this local economy going primarily,
and every business is affected positively by the influx of tourism.
(16:22):
My demographic, you know, we we're a small restaurant, we're
right on the beach. We have incredible local support, our
local community. Really, they're here for us and we're here
for them. But there just aren't enough people locally to
sustain all of our restaurants and hotels and so forth.
So that influx in the summer keeps us flowing all year,
(16:44):
even though it's only you know, a part of the year.
And the tourism, you know, we're expecting a twenty nine
percent decrease in international tourism in the summertime. Governor, my
demographic is between seventy five and ninety percent tourists visiting
my restaurant. And that's not just my restaurant. Those are
the numbers I have real you know, tangibility in but
(17:05):
it's every restaurant in this area. And when we take
up to ninety percent of my cash inflow, decrease it
by about thirty percent do to specifically and directly because
of the tariffs. That's something that you know, we're having
trouble anticipating how we're going to navigate that. And the
(17:26):
other part of that, of course is cost of goods
and services. We run a New Orleans you see the
sign behind me here, New Orleans Cajun and Creole style restaurant.
So the bulk of my menu we make everything from scratch,
so we're using you know, whole onions, tomatoes, spices, and
then a lot of seafood and shrimp is expected to
go up. We get a farm report forecast from our
(17:47):
food distributor. Shrimp is expected to increase up to forty
six percent directly because of tariffs. Most of my menu
we can expect to go up about twenty five percent.
This is tomatoes, onion, garlic, spices, just everyday things. And
while we can adjust, of course, we'll have to increase
(18:07):
menu prices, as will every restaurant everywhere. So we can increase,
and that feels it makes me sad for my local community.
But then when we decrease the tourism coming in, it's
a double blow, and not just a double blow, but
has that ripple effect that goes far and wide. If
I speak only to my community, this rural community, whose
(18:29):
sports teams you know, Little League and the marching band
and different things rely on the local businesses supporting them,
and this economic impact is so far reaching. I'm an
eternal optimist. I'm always someone that figures things out and
we look for, you know, solutions. This one is more
(18:50):
difficult to see our way through it at this time.
Speaker 1 (18:54):
Well, I appreciate you said two things that are important.
You talked about community. I mean community at the end
of the day, you it's not something you can manufacture.
It's a sense of pride. It's that connection to as
you say, these organizations and your neighbors, where magical moments
are created in your restaurant and friends and relationships are formed,
and you're such a big part of that and a
(19:16):
vibrant part of that. But you also highlighting something that's
often overlooked, and that is tariff's impact tourism, and people
don't necessarily connect that dot as easily as they should
or as consequentially as they must. And when you say
twenty nine percent, was that analysis that was done by
your regional chamber or is that on the basis of
(19:37):
what you're already seeing in terms of decline of visitorship
that you would otherwise expect this time of year.
Speaker 5 (19:43):
This time of year we would start seeing a lot
of international tourism, a lot of people from Europe in particular.
Later in the season we see a lot more Asian
tourists coming in. But you know, as you said, Redwood
National Park, which is here, draws people from all over
the world. We have the mainly one percent of old
growth redwood, and that is really something to see. So
(20:04):
my twenty nine percent came from the economic forecast, out
of the larger chamber anticipation for how that's going to impact.
And you know, in this rural agent of the region
of the world that I'm speaking to my county specifically,
but this whole North Coast is very rural, and so
there's about five counties that all see the same economic impact,
(20:26):
and it's this entire northwest region of California, Humboldt County,
mill North County, Mendocino County, Lake County, Trinity. You know,
it's a huge portion of the state that is going
to feel and real from the effects of a lack
of people wanting to come here directly because of the tariffs.
Speaker 1 (20:45):
So, you know, you've weathered a lot. You got through COVID,
which is extraordinary. You've got that entrepreneurial energy and as
you said yourself, and it's self evidence to anyone listening
you're watching, got such a spirit of positivity. I mean,
what how do you how do you sort of game
this out? I mean, what's what's the strategy for you?
Speaker 2 (21:08):
Is?
Speaker 1 (21:08):
Are you looking at potentially layoff so you can only
pass through so much cost obviously on the customer side,
if they're not coming in the fixed costs of devour
even any any variable menu prices, what what's what's what's
their strategy? What's your How are you gaming this out
in the next few months?
Speaker 5 (21:27):
Yeah, well, you know it's a day by day what
where can we pivot? Where can we pivot? Restaurants historically
have a very tiny profit margin, and as a small business,
as our most businesses in my community, we don't have
the luxury that chains have to be able to absorb
some of that impact because of other stores. So how
(21:48):
do we navigate that. Of course, you know, increasing as needed.
We don't like to do that, but things happen. Cutting
costs wherever we can, cutting labor. You know, we as
owner operators, we work fifteen hours a day laboring in
our restaurant and it's a labor of love. I don't
say that with anything except gratitude, but there are only
(22:10):
so many hours in the day, and so looking you know,
it adds more work to the people that we employ.
So the way we're navigating this is looking at other
ways we can bring money to the restaurant, so creating
other events, you know, community events, things like that. Always
looking at what's working and trying to trim what isn't working,
(22:31):
really making our menu hyper efficient. We got our restaurant
two days before the COVID shutdowns and so it was
a incredible lesson in business management in a very short time.
And so we've learned to pivot. But that's not always
easy when things are changing so rapidly, and as we're
gearing up for our summer season, you know, it's really
(22:53):
just again becoming hyper efficient, hyper educated. We rely on
what's called the farm report forecast, so we can look
at where we can trim costs. You know, at some
point in the day there's only so much we can do,
and then we just try to write it out with
the support of you know, our community.
Speaker 1 (23:14):
Well. I appreciate and I appreciate what you're doing, how
you are representing not just yourself, but your community and
others that are struggling with this new reality as well.
And anyone that gets up to Crescent City and if
you haven't been, you got to go, needs to go
to your restaurant. What's the name of the restaurant.
Speaker 5 (23:34):
It's a Schmidt's House of Jambalaya. We're right on the
beach at South Beach, and it's an extraordinary community. We're
very thankful to be part of it.
Speaker 1 (23:43):
And go up when you're up there and visit and
say hello. Really appreciate you taking the time, thank you
for sharing your insight, and thank you for staying the
course and being so positive. And we're going to work
our tail off to try to curtail the impacts of
these tariffs and lack of I think understand standing of
the impacts it's having on people like yourself and communities
(24:03):
all throughout this country, but certainly here in this north
part of our state. Thank you so much for joining us.
Speaker 5 (24:08):
Thank you, and I just want to add, you know,
I really feel advocated for I appreciate your leadership. We
appreciate your leadership and everything that you're doing as a
voice for the people. Thank you so much.
Speaker 1 (24:17):
I'm grateful. Thank you for joining us. Thank you.
Speaker 4 (24:25):
How you doing, Governor?
Speaker 1 (24:27):
Oh good man, you're well. You're Chino, California, right, Yeah.
Speaker 6 (24:31):
I live in Orange County, California. My company here is
in Chino. We also have a warehouse and location in Amsterdam,
in Holland.
Speaker 1 (24:39):
I love it. And so tell us about your business,
the wheelchair business. Huh.
Speaker 6 (24:43):
So, we are in the durable medical equipment business, primarily
related to wheelchairs and scooters.
Speaker 4 (24:50):
We provide, you know, the product.
Speaker 6 (24:53):
For people that are either permanently or temporarily disabled, including
organizations such as Think on my Emails, the Steve Gleason Foundation.
He was an x NFL football player for the New
Orleans Saints. So we sell our product were wholesaler, so
we wholesale them worldwide, and we've been doing this for
(25:14):
quite some time, about eight years. We're conservably growing company.
We typically grow about two to three hundred percent perannum. Wow,
it's a very expensive business. It's not a business that
is for the lighthearted. So it requires quite a bit
of capital to operate this kind of company, and you
have to have a passion for it, which is something
that myself and all of our team members we have
(25:37):
a great passion for what we do.
Speaker 1 (25:38):
And Joseph, how many countries are you exporting to? How
many countries you're working with?
Speaker 6 (25:44):
So because we have the European operation, we can export
to Belgium, Switzerland, Germany, the UK and of course the
Netherlands at the moment in America from here we export
to Canada and parts of Mexico and you know Puerto
Rico which is still part of part of US.
Speaker 1 (26:03):
So what I mean, so these teriffs are announced, I
imagine you know, you had to anticipate something might happen
in this space. Tell me a little bit about that
thought process. You know, when Trump gets elected, he was
pretty clear that he was going to move in this direction.
Did you expect it as quickly? Did you expect it
as acutely? How has it impacted your business and your
(26:24):
and your business plan going forward?
Speaker 4 (26:26):
Yeah, so wonderful question.
Speaker 6 (26:28):
We we did have a feeling that this could happen,
we didn't expect it to be as drastic as it has.
And the reason for that is based on the fundamental
sort of principle that our industry has been exempt from
tariffs since we've had the operation. So even though we
expected tariffs to apply, we did not expect that they
would be applied to our industry as we've been exempler
(26:51):
for all of these years. Nor did we expect that
if they were going to be applied, that it would
be as high as they are. So probably about eight
months prior to this, I had set up a separate company.
Part of the election of Donald Trump. We had separate
separate company with the idea that we would manufacture our
(27:11):
own products within the US, and so we started discussing
things with even Chinese partners. Meet these partners Mexico went
down to Mexico many times to set up a Mikhilidora
down there, thinking that my work went to Texas, went
to various states. What we realized the governor is that one,
the cost of operating in America is still extremely expensive
(27:34):
number one. Number Two, securing and obtaining the materials that
we require are extremely difficult to find we might be
able to find some metals, some aluminum, but things like
carbon fiber or things like lithium. I own batteries, things
like technology that goes into our joysticks. You know, we're
sort of a highly you know, automated business to a
(27:55):
certain extent that relies on technology. And what we quickly
found is that what we require fired just wasn't available.
It wasn't available as we needed it, and we thought, okay,
this is probably something that the United States isn't quite
ready for as yet. So when obviously the terriffsupply were applied,
(28:17):
you know, it drastically affects our ability to trade. You know,
I mentioned in my email that we're working with quite
a large community that is quite vulnerable, whether it's the
geriatric community, which someday, as you know, governor we live
long enough, we might all be in a wheelchair or
(28:38):
a scooter. But in addition to that, you know, we
deal with like the Gleaston Foundation, which has you know,
their members are they have als. We work at a
mass organizations patients that have Parkinson's et cetera. So not
only are they in a in a situation help wise
that is not ideal, but any of these folks just
(29:00):
don't have the resources, financial resources to secure the.
Speaker 4 (29:04):
Product that we sell.
Speaker 6 (29:05):
And although we are we sell our products relatively and
expensively compared to the market, it is still you know,
a necessity for them. And unfortunately, you know, with with
the terriffs as they currently stand, you know, it's it
becomes almost an impossibility to be quite honest, you know,
(29:27):
I'll give you a real number or real numbers. We
had ordered sort of a few containers here recently that
were we expected to pay about six hundred grand for well,
with the tariffs applied, it's now an additional eight hundred
and thirty thousand on top of that.
Speaker 1 (29:42):
And so let's just want to make that clear. It's
not from six hundred thousand to eight hundred thousand, it's
an additional eight.
Speaker 4 (29:49):
More than that's correct, that's right.
Speaker 1 (29:52):
And that and that was most of that product coming
from China specifically.
Speaker 4 (29:56):
That's right.
Speaker 6 (29:57):
Yeah, that's right. So you know, it's in the day
eight hundred and thirty thousand. So our choices are and
in our industry, we you know, I'm not a I'm
not backed by private equity. I don't have any VCS
behind me. We are we are operating ourselves. We've grown
this company ourselves out of our own resources. So you
(30:18):
know the idea of pain and additional eight hundred and
thirty thousand when we don't know if these tarifts are
going to change tomorrow. You know the story, it's been
up and down. Yes we're going to reduce tariffs and
no we're not. So it's very unpredictable for myself and
other companies in my situation. If we fund that money,
(30:39):
you know, obviously we would need to recover it somehow,
and unlike a common belief that the exporting company pays
for these things, it's just not true. I mean, the
import for us, we would pay that additional amount, and
then we would have the decision to make do we
pass it down to our consumer, which is in our case,
our reseller for World Blae, or do we absorb the costs. Well,
(31:02):
there's no business that I've been in. I mean, you
were in the wine business.
Speaker 4 (31:05):
You know this.
Speaker 6 (31:05):
There's no way that the company can operate with an
additional one hundred and forty five percent tariff.
Speaker 4 (31:11):
I mean, your.
Speaker 6 (31:12):
Operating income is just not there. So you know, it's
sort of devastating to us to to on many different levels,
but most importantly on the level of the consumer, particularly
the ones that we serve, because you know, when you
when we deal with nonprofits, you know they they have
a limited budget, and so what it now means is
(31:34):
that do they not get the chair or do they
get you know, a third or twenty percent of what
they require.
Speaker 1 (31:39):
So Joseph, I mean, did you end up making the
purchase or you just you know, you just you're waiting
around with all that uncertainty. What'd you do?
Speaker 6 (31:46):
We wait right now because we have sufficient inventory to
cover us fortund maybe four.
Speaker 4 (31:51):
Months, that's it.
Speaker 6 (31:53):
But you know, with lead times, et cetera, we really
have to have those containers shipped within the next fifteen
to twenty days otherwise we're going to run out. So,
you know, it's it's operating a business obviously, as you know,
this is not always going to be you know, rosy,
if it was, probably every way would do it. That's
(32:14):
just not the way it works, and you're in a
game that's probably even tougher in mind, but the reality
is that, you know, you have to kind of deal
with the cars as they are presented, and right now,
I think what is hurting many of us.
Speaker 4 (32:29):
In addition to the tariff.
Speaker 6 (32:31):
Is the uncertainty and the you know, for lack of
a better word, the flip flopping of is it going
away or is it saying right? And and so you know,
we have a real urgency in our industry because of
the necessity to satisfy the demand.
Speaker 1 (32:50):
What do you, Joseph, just out of curiosity? And you know, look,
when you put everything on the line, all the risk
you leverage. You talk about how capital in tense? Have
you just proved that point is where like to you know,
just those kind of those purchasing orders that you're making
and the bet you're placing. But how do you how
do you even talk to your employees? I mean, what
do you tell these guys? What do you tell your
(33:11):
folks around you? And as you say, I mean you
talk about the most vulnerable what you're doing for charities
and nonprofits, and I think that really paints a pretty
powerful picture. But what what's the anxiety level within the company,
within the organization.
Speaker 6 (33:27):
So we're very transparent a lot of the guys that
you know, I've owned several companies in my career. In
this particular one I brought in a lot of guys
that I've worked with for eighteen to twenty years, so
they're friends there.
Speaker 4 (33:39):
Most of them were either.
Speaker 6 (33:40):
Professional athletes or along the lines of playing at university, baseball, football,
you name it. So we're all highly competitive, and we
all our manner of operations were very direct in terms
of how we speak to each other, so they're well aware.
And there was a point that, you know, a conversations
had we said, guys, look, if this, if this is
(34:02):
the way it's going to be, I cannot promise everybody's job.
It's just not conceivable, let alone my own, let alone
my own company, right because if if this were to
carry on, you know, for the next twelve months or so,
I just can't imagine anybody in our industry that's playing
on a level plane field would be able to operate.
(34:24):
It's just it's just not possible. So it's a it's
a really concerning thing. And I know I'm taking up
airspace here, but if you don't mind me just saying, also,
had we you know, if we had the infrastructure in
America to do this, you know, in terms of what
I mentioned earlier, the batteries, the joysticks, the aluminum, the
(34:45):
ability to do this, and we had the resources of
being able to kind of operate this business, which I mean,
it's not inexpensive. You know, it would require several several
million dollars to operate a manufacturing company. You know, I'm
not opposed to that. I'm not opposed to actually trying
this out, but I will say this, given them my
(35:05):
experience is that even if we were to do that,
you know, a wheelchair that might cost somebody today twelve
hundred dollars isn't going to cost twelve hundred dollars tomorrow.
You know, if we're manufacturing this, it's going to be
you know, twenty four to twenty five hundred dollars.
Speaker 4 (35:18):
Yep.
Speaker 1 (35:19):
So the bottom line I mean, and I appreciate at
the end of the day, the bottom line is the
bottom line, and one ask to soberly sort of understand
the consequences the benefits obviously of bringing those supply chains
back home, the opportunities and the jobs creating that. But
from the consumer perspective, that's that's pretty stark increase in
(35:40):
a reminder of the trade off as it relates to this. Look, Joseph,
I appreciate you painting that picture. Thank you, for highlighting
some real world impacts that are acute and immediate, and
also just the deep uncertainty as we wait day to
day and as you suggest, it's you know, it changes
day to day, the flip flop, the lack of certainty.
And as a business owner myself and I appreciate that
(36:02):
reference certainty is the coin of the realm. At least
you can work around that and you can make some decisions,
but the inability to make decisions is perhaps to me
the most stifling, and I think for you, you know,
I can't imagine the most alarming part of.
Speaker 4 (36:20):
All of this.
Speaker 6 (36:21):
Yeah, no doubt, uncertainty plays a huge part. And you know,
we were trying to represent a company that is American
based and grown, and you know, again we take great
pride in what we do. You know, there's a lot
of stories here of individuals that have family members that
require what we do. And it's just extremely frustrating, you know,
(36:46):
to sort of be in a situation where we've grown
and developed such a reputable organization and find ourselves in
a situation that is completely out.
Speaker 4 (36:56):
Of our control.
Speaker 6 (36:57):
Yeah, you know, we're really just we have no control
over this portion of what we can do well.
Speaker 1 (37:05):
Appreciate it. But you know what, it's the fact that
you're willing to share that story gives you agency, gives people,
I think, a deeper understanding of what's at stake. You
and thank you Joseph as well. You only reinforce the why,
the why. I'm proud on behalf of you and forty
million of us. California was the first state in the
(37:26):
country to sue the Trump administration as it relates to
his authority on these tariffs. And by the way, I
am damn confident we're going to win that and we're
going to get clarity on that in the next few weeks.
So I really appreciate you willing to share your story.
Thanks for all the good work, remarkable work you're doing,
how you're changing lives, for your charitable focus, not just
for your entrepreneurial spirit.
Speaker 4 (37:47):
Yeah, thank you for that.
Speaker 1 (37:48):
Take care, Thanks so much for joining us.
Speaker 4 (37:49):
You're welcome. Thank you so much.
Speaker 1 (37:51):
Appreciate Hey, Jennifer, Hi.
Speaker 7 (37:54):
Hi, Gavin Nissam, how are you doing.
Speaker 1 (37:56):
I am good where you're in the great city of
Palm Springs.
Speaker 7 (38:00):
Right, this is correct, this is correct.
Speaker 1 (38:03):
I love it. And tell me a little bit about
your business when you opened it up, and how you're
feeling about everything right now.
Speaker 7 (38:11):
Well, thank you.
Speaker 8 (38:12):
Thank you again for taking the time and allowing us
to share what's happening with small business right now. So
my name is Jennifer Gold and I'm the founder and
curator of Grounded Bodyworks boutique while Miss Spa based in
Palm Springs.
Speaker 7 (38:29):
We're celebrating our thirteenth year this summer.
Speaker 8 (38:33):
And when I started, there was just me and one
of my massage therapists that I actually taught massage. I
was the director at a local school for a minute
and hired her and it was just us for a while,
and now I have a team of twelve, and goodness,
(38:54):
it's just been it's been kind of a whirlwind. I've
learned a lot. Leading up to COVID, I think under
goodness Obama, our business was grown, growing steadily year after year,
and then the pandemic hit and that momentum.
Speaker 7 (39:10):
Has just gone overnight.
Speaker 8 (39:12):
Yeah, you know, And if I could take a moment
to just personally thank you for your support during COVID,
I took the grant I have the eed Alan I'm
currently repaying. Made the difference between closing our doors and surviving.
Speaker 1 (39:26):
So thank you, oh, thank you for that. So is
this I mean, Jennifer right now, I mean forgive me
for cutting off because I think it's an interesting I mean,
the fact that you went through that experience in the
trauma personally, professionally as it relates to COVID. How is
this moment Does it bring back those memories? Is it
(39:47):
on par with that? The uncertainty, the impacts to your business.
Speaker 8 (39:51):
It's definitely uncertain. The struggles are very real. There's still
very real. I can't believe it's been five years. You know,
we're still recovering. For many of us, it's fragile and
these tariffs could be the thing that pushes us over
the edge.
Speaker 1 (40:05):
And how are the tariffs directly impacting the work there
is I imagine? I mean, we've we've been reading a
lot all over the national news Palm Springs reaching out
to Canadians. Two million Canadians last year visited the state
of California. Palm Springs one of the biggest beneficiaries of
the number of tourist dollars spent. Has that had an impact?
(40:27):
Is it more direct in terms of supply chain and
materials that you're using at the spot give us a
sense pink the picture.
Speaker 8 (40:35):
Sure, sure, so there's I'd say there's like three three
caveats that are that I'm experiencing right now personally. And
then with my business, I'm just on a spending freeze.
Speaker 7 (40:49):
We're afraid.
Speaker 8 (40:49):
I'm afraid to invest As a business owner, I've paused
all major purchases. I want to invest in growth, but
right now then certainty is just too great. Our customers
are also hesitant. Even in an affluent area like Palm Springs,
people are pulling back on non essential spending that slows
everyone down.
Speaker 7 (41:10):
I'd love to partner with Hydrofacial. It's a long beach.
Speaker 8 (41:14):
So I'm from Compton, my family's from Quebec. So you
know what I do with Grounded is I promote all
these local businesses from la where I'm from, all the
way to Quebec where my family's from. I'd love to
bring in Hydrofacial, this California brand and manufacture, but the
machine costs over a thirty thousand dollars. I'm not about
(41:36):
to invest in that right now, you know. And then
I'd say the next thing would be our vendors, even
like our skincare line is Oseia in Malibu. I'm sure
you've heard of them, women owned brand based in California.
Their ingredients and operations are all local, but that doesn't
(41:57):
make them immune. If griffs increase the cost of imported
packaging materials glass, you know they have glass, but there's pumps,
there's lids. It affects pricing. That increase comes to me
and then it's passed on to my customers. Even if
we're doing everything right and we shop local. We support
(42:17):
Californian companies staying sustainable as we can afford to do that,
but local, I'm sorry, global policy is still hitting our
bottom line. And third, it's been a very emotional two months,
but a month and a half saying goodbye to our Canadians.
(42:38):
You are correct, Ron DeHart our manner just send out
an email addressing this Palm Springs is amazing. They've been
really trying to help support Canada. They just hung all
these banners downtown just to show our support. There's all
these Canadian flags.
Speaker 7 (42:54):
It's beautiful, but it's been very emotional.
Speaker 8 (42:56):
Every spring we say goodbye to our Canadian visitors. Your
many have said goodbye for good. Some have sold their homes.
They're not rebooking. These guests have supported us three years,
including through the pandemic. Their absence this year is emotional
and financially crushing. They spend They bring in three hundred
(43:17):
and two million just to Palm Springs or the Coachella
Valley alone. Palm Springs is deeply tied to Canadian tourism
and if we lose our small businesses and are left
with only big box stores, we'll lose the very character
of our city.
Speaker 7 (43:34):
I mean, we're still recovering. You know.
Speaker 1 (43:36):
Well, thank you for pinning that picture of Jennifer. It's
you know, in California, we were launching a multimillion dollar
campaign to encourage Canadians to come back to Canada. Campaign
we announced a few weeks ago saying, you know, California
wouldn't be California without Canadians. But it's the response to
was interesting. People are very raw and emotional about it.
(43:59):
And even the California is not you know, it's not
maybe the most untrumped state in America. The state of
mind is still a tremendous animus from the damage we've
done to the relationships up north, and I imagine just
for you. The emotion is extended to just family you
have up in Quebec, right.
Speaker 8 (44:18):
I have one aunt left up there. The rest of
the family moved to the States in the seventies and
she just couldn't leave her horses day, so's she's still
up there. But it's really you know, my vendor friends
were communicating, we're trying, We're trying to make it work.
Speaker 7 (44:36):
I only have two Canadian vendors right now.
Speaker 8 (44:39):
But if I may give you an example, are nail
so I run a spa, a boutique spa in Palm
Springs and name we offer nail services in our vendor
for our nail products. Or in La it's called Cot
and she's redoing her line. A lot of the packaging
(45:01):
is from China. So because of these tariffs, I've been
rethinking do I stick with coat, you know? And then
there's a line up in Canada called Behind and they
have a nail line and it's made in Canada.
Speaker 7 (45:16):
But again, I just feel.
Speaker 8 (45:18):
Like I'm going to lose, lose, you know, just trying
to stay local but make it all work well.
Speaker 1 (45:24):
Jennifer, I really appreciate you putting in a human face,
your own humanity behind this, and I extend that humanity
quite literally your support for others in the region, other
small businesses. And I think it's so insightful and helpful that,
as you say, even locally made products have packaging components
(45:44):
and other component parts that they have to import, and
those costs are burdens that ultimately will be passed on
to you and potentially your customers. And it's such a helpful,
I think, insight to understand the impacts, the cascading impacts
of these terrafts, including obviously the tourism component that compounds that.
(46:05):
But what you said, I think is the most damning.
It's just the level of anxiety that you have to
personally go through, professionally go through, and as a consequence
of that anxiety and unwillingness to make a big, bold decisions,
which are decisions often you have to make with some
confidence about the future and what it will hold. And
(46:25):
so thank you for sharing your story. Thank you for
weathering a lot of storms. I'm confident you'll continue to
and I think it's a big help for those watching,
in those listening.
Speaker 8 (46:37):
I appreciate that. Thank you again for all your support.
Couldn't have chosen.
Speaker 7 (46:41):
A better state to be in right now, So thank
you again.
Speaker 1 (46:45):
We're gonna we're gonna take it to the Trump administration
and we're going to beat back these tariffs. You watch,
we have our day in court quite literally coming up
very surely, Jennifer, thanks so much for joining us.
Speaker 7 (46:56):
Thanks so much, Thank you very much. The Song of
ADM
So the International Monetary Fund just announced that California is
the fourth largest economy in the world. Only Germany and
China in the United States have a larger economic output
than the state of California. That's the good news. The
bad news is there's no state in America that is
more impacted by uncertainty and these tariffs imposed unilaterally by
(00:25):
Donald Trump and the Trump administration. The impacts of that,
of course, are felt small businesses, medium sized, large businesses, consumers,
as well as supply chains, not just in our state,
but all across this country and around the world. So
today we'll be exploring the impacts, real life impacts on
real people, impacts and states large and small, from Montana
(00:48):
to Minnesota to here in the great state of California.
Tune in to this live program on the impacts of
Donald Trump's tariffs in America. Is Gavin Newsom. Let's talk tariffs.
Speaker 2 (01:03):
Hey, Bath, I am trying to get my phone turned off.
I just got this phone. I don't know who to
do it.
Speaker 1 (01:08):
What is an Android or an iPhone?
Speaker 3 (01:11):
It's an iPhone, but it's the new one.
Speaker 1 (01:13):
Good. It's smart to buy it now and not in
a few months when it's twice the price.
Speaker 3 (01:17):
Won't be twice the price they're exectly from tariffs.
Speaker 1 (01:19):
That's right, because they made a phone call crony capitalism, Beth,
that's a whole nother conversation, Beth, Thanks for joining us.
And you're in Minnesota. Where are you exactly in Minnesota?
Speaker 2 (01:32):
I am in southeast Minnesota's and Broda, fifty minutes south
of the Twin Cities.
Speaker 1 (01:37):
And tell us a little bit about your business and
when you started it and the impacts of these tariffs.
Speaker 3 (01:41):
Yeah.
Speaker 2 (01:42):
I started my business eight years ago, right after my
son was born. I had an idea for a baby
product that solves a problem all new parents have of
babies just dropping and throwing all their stuff. I made
what I now know to be a prototype for myself
and one of my friends who had a baby, and
she forgot it and said, you should make this thing
for real, because I didn't realize how awful it was
until I didn't have your matte thingy. So I invented
(02:04):
the busy Baby matt It's just a silicon place mat
that suctions to the high chair and has tethers that
you can use to attach.
Speaker 3 (02:10):
Babies baby's things.
Speaker 2 (02:13):
Since that time eight years ago, I was able to
go on Shark Tank and show the world my invention.
And from that I was able to tell my brother
to quit his job and join me in the business.
Speaker 3 (02:26):
And two of us have exbanded.
Speaker 2 (02:28):
The product line now to eight products that all have
the same mission, keep baby things within reach, off the ground,
at home and on the go.
Speaker 1 (02:34):
I love it. And you source your products from where?
Where do you get the materials? Where do you get
most of your supply?
Speaker 3 (02:40):
Yeah, we are one hundred percent in China, one hundred percent.
Speaker 1 (02:43):
And did you look around? I mean, was it China
first or it just where it's sort of the dominant
manufacturing occurs.
Speaker 2 (02:50):
No, we actually tried for a year and a half
to manufacture in the US, and there's a lot of
obstacles to that. One is the raw material is not
sourced in the US, so that has to be imported.
We learned this morning. We've been continuing to find ways
to manufacture in the US and had a great meeting
this morning with a silicon manufacturer here in New York,
and we're still learning more. It's still not viable for us. However,
(03:13):
we're continuing to try. But the main obstacle is when
you have a startup, when you are brand new. We're
not making twenty thousand units. We're not making two hundred
thousand units, or many companies a million units. I was
trying to get two thousand units because this was a product.
Speaker 3 (03:30):
That never existed before.
Speaker 2 (03:31):
I didn't even know if people were going to buy
this item. I knew it was a good idea, but
I didn't know if my fellow Americans would think it
was a good idea. So there were no American factories
that were willing and able to do this project on
such a small scale to start, so we did have
to start in China.
Speaker 3 (03:48):
They were willing to do that with us.
Speaker 1 (03:51):
And so the impacts are immediate. The one hundred and
forty five percent tariffs, I mean, I mean, what has
that meant? I mean, is there sort of a dollar figure?
Do you recall that first invoice purchase order? Came back
and looked at that delta, and how do you respond?
Speaker 3 (04:06):
You know, it's more immediate than that. I could literally
lose my home.
Speaker 2 (04:09):
In less than three months, So I'll walk you through
that real quick. This last six months has been amazing
for US. I got a contract with Walmart. I got
a contract with Target. We're in both stores now. Minnesota
awarded me SBA Small Business Person of the Year. It's
been a really sunshiney last six months. I booked my
(04:30):
flight with my eight year old son to take him
to DC to get this award on May fifth, and
then nine days later, as my products were two day
shy of being picked up to put on a container
to come to the US, these tariffs came out. The
announcement came out. So what I was expecting to pay
twenty maybe thirty thousand dollars worth of tariffs, that's what
(04:52):
I budgeted for now is going to cost me two
hundred and thirty thousand dollars to bring into our country.
I have made maybe two months worth of inventory left
in in my warehouse here, and when that has gone,
I have no more revenue. I have no money coming
in to pay my employees. I have no money coming
in to pay my bills, the other American businesses that
(05:13):
I support through my company, my marketing teams, my bookkeeping,
my accounting, everyone who helps me run this business, all
American companies, my transportation team that was going to bring
that container to me. I can't pay any of them anymore.
And the worst thing is I can't pay my loan.
And when I got the contracts for Target and Walmart,
(05:34):
I took a big, big business risk, and a lot
of us small businesses do this. I leveraged my home
to be able to buy the inventory to support these
contracts because that was the next big milestone step in
our business. And now I am at grave danger of
not being able to get my products here, not being
able to continue to sell and have the cash flow
(05:56):
that I've counted on, and not be able to pay
on those loans, which means I could lose my house
where my children live and my ability to keep them
safe and feed them.
Speaker 3 (06:10):
That's how real this is for me in this moment.
Speaker 1 (06:12):
I mean, boy, I mean, you paint the ultimate picture.
I mean, just the deep reality. And you know in
the fact that it was because of your kids that
inspired this business in the first place, and now your
home is a risk. Everything about that is an extraordinary
picture paint of the pain and anxiety that you're going through.
(06:33):
I mean, and forgive me. I mean the options for
you are what then right now? Do you called Walmart
back and Target and you say can you help? Are
there is there a strategy there so they float, you know,
ninety day invoices or something. I mean, is there a
strategy that you can see an alternative if this continues.
Speaker 2 (06:55):
Right now with those retailers, I actually have their inventory here.
That's why I had to take that big risk early on,
was you have to order the products in bulk so
that I have them here. So every week when they
place their order, I have something to send them. So
currently their product is here. That should support us six months.
With those retailers, I did have the opportunity to expand.
Walmart wanted to take on another product this year in November.
(07:17):
I had to call my buyer and say, I don't
know if I can do that right now. As of
right now, I cannot add another item. I cannot expand,
and because of the situation we're in, if I can't
get my products here, I'm going to have to just
sell the products that I have set aside for Target
and Walmart just to get some revenue in the door
to keep paying my employees. So Walmart's been great. They
(07:40):
have offered to you know, let's just see how this goes.
Speaker 3 (07:43):
We'll be patient.
Speaker 2 (07:44):
You know, they're not going to push the timelines that
normally they're very strict to with suppliers. Let's just kind
of see how this goes for a little bit. And
you know, they kind of said, we got you, we'll
figure it out.
Speaker 1 (07:54):
So what did you? And I'm curious, just you know,
and I don't mean this to be political, it's but
when Trump was elected, he talked about these tariffs on China.
Obviously his first first term he advanced tariffs on China.
So you must have anticipated something, But did this come
(08:15):
as a complete shock How quickly this happened, the level
of the tariff, meaning how large it was, give me
a sense of how you prepared a little bit over
the course last few months.
Speaker 2 (08:24):
Yeah, Prior to this administration, we didn't pay a tariff. Ever,
in my eight years in business, we've never paid a tariff.
We pay taxes, we pay duty, we have never paid
a tariff for baby items. When the administration came in,
knowing that they had talked about bringing in tariffs, we
expected a reasonable tariff twenty to maybe thirty percent, and
we looked at our numbers and decided we can we
can support that. It's going to be tough, but we
(08:46):
can stay live and support that we budgeted for. That
we did not budget for one hundred and forty five percent.
Speaker 1 (08:53):
No, I mean it, no one can, No one can. Well, Beth,
I can't impress upon you how grateful I am that
you had the courage to come on the show and
thank you for showing up, and not just for yourself
and your family, for your eight year old and your
brother and your employees, but for others in your circumstance
and your position. I think you know, all of us
(09:15):
out here in California, we're not only rooting for you,
we have your back. We initiated a lawsuit to push
back against the Trump administration. I mean, even on the
in the conservative side, the Koch Brothers are aligned in
that as it relates to the how thisnilateral action by
Donald Trump is simply illegal, and so we're serting ourselves
(09:36):
very aggressively in that space. So you can get some clarity.
But I'm curious, just you know, as you look out
over the course of the next days and weeks, with
all that anxiety in your house looming over this conversation,
I mean, you've got a week or how many weeks,
how many months do you think you can hold on
with this level of uncertainty before you just have to
(09:57):
make a real decision that may be sort of closing
up shop, so to speak.
Speaker 2 (10:02):
There's no closing up shop for me. I am a
tenure army veteran. I am not a quitter. I am
one who adapts and overcomes. We've got about two weeks
until we need to make critical decisions where we now
out we'd sell to other countries.
Speaker 3 (10:16):
We babies are everywhere.
Speaker 2 (10:17):
We've lined up some distribution in Australia, in Dubai, in
South Korea, and Canada. That if if we don't have
a resolution in two weeks where we can bring our
products to the US and sell to our fellow Americans,
then we're going to have to, you know, make that
decision to sell outside of our country, which is going
to be much more difficult for us. It's all unknown
(10:39):
to me. I've had to learn this business from scratch,
and now I need to learn international distribution like this.
Speaker 3 (10:45):
But I'm up for the challenge if I have to.
But what I really need is I need our.
Speaker 2 (10:53):
Representatives to stand up for us and stand up for
Americans in my district. I have a Republican congressmen who
will not even talk to me. And I was at
I just watched your podcast with my governor that you
recently did, and I was actually at the Capitol this
week for Governor Walls's State of the State address, and
(11:17):
what I saw broke my heart and has me just
feeling so depressed because we need our politicians to stand
up for Americans. When Walts was talking about the achievements
of our state in the last year, and one of
them in Minnesota is free breakfast and free lunch for
our students because science has shown wealth had kids have
(11:39):
better outcomes.
Speaker 3 (11:40):
This is a great thing.
Speaker 2 (11:42):
One half of the room was standing and clapping. The
other half of the room was sitting cross armed with
ugly faces. And I saw the opposite thing on the
President's State of the Union address, where one side is
clapping and the other side is pouting.
Speaker 3 (11:54):
And right now, we don't need that.
Speaker 2 (11:56):
We need our representatives to come together for Americans. We
need Americans to come together. I am feeling so much
hate from my fellow Americans who think that because I
make my products in China, that I am evil and
that I deserve to fail. And where we learn things
in our lives, you know, my children. I'm trying to
(12:18):
teach them kindness, I'm trying to teach them love. They
learn from me as an adult. We learn from our
bosses and from our leaders. And right now, what we're leading,
what we're learning from our politicians is to be divided,
to be hardline one way or the other. And if
I'm on this side, I can't possibly celebrate something accomplished
on the other side. And now the American people who
(12:39):
should be coming together and supporting one another and loving
one another. I had a woman tell me on TikTok
that I am going to fail and I deserve it.
No one deserves to fail. No one deserves to lose
their house, the roof over their children's home, no one.
And so you know, I need our politicians to come
together and support the Americans and stop fighting each other
(13:02):
and work together for the American people.
Speaker 1 (13:05):
I personally love that in ways you don't even fully
perhaps appreciate. My first three guests on this podcast. We're
all conservatives, that we're all supporters of Trump, and I
made exactly the point you just made. At the end
of the day, we all want to be protected, connected, respected.
We can't continue to continue talk down to each other,
past one another. We're all in this together, we're all
(13:27):
better off. We're all better off. So I readly. I
appreciate that sentiment. I appreciate you have no I'm an entrepreneur.
I love love your entrepreneur passion. The fact you're putting
everything on the line and putting human face on this
topic is inspiring. And I ain't worried about you failing that.
(13:48):
You got that gene, you got that grit that defines
the best. So thank you Beth for joining us.
Speaker 3 (13:53):
Yeah, thanks for letting me use my voice to stand
up personal businesses.
Speaker 4 (13:57):
You're here.
Speaker 1 (13:58):
We appreciate you.
Speaker 5 (14:04):
Hey, Jennifer, good morning, Governor.
Speaker 1 (14:07):
Where are you? What's that background? I love it? Oh fabulous.
Speaker 5 (14:10):
I'm in my restaurant. I live and own and operate
a restaurant in Crescent City, California, which is up in
Dilnark County. I believe you visited last about a year ago,
up in this region.
Speaker 1 (14:21):
I used to go up there as a kid with
my father, and one of the great gifts last year
is bringing my four kids up there and walking in
the same footsteps as I walked as a young child.
There are a few places anyone listening. There are a
few places on planet Earth that are more spectacular than
(14:41):
where you operate your restaurant. The absolute physical beauty is extraordinary.
And so I love it up there, and I appreciate
you're running a restaurant up there which is in and
of itself amazing and remarkable. And I imagine with all
of the uncertainty and announced mins and we just saw
some new tourism numbers already coming in that show a
(15:06):
decline in tourism across our state, that these tariffs have
in an impact on your business.
Speaker 5 (15:15):
Yes, so in the area, just so the listeners know
where I live. We're up at the very top coastal
corner of California, extremely remote, extremely rugged and rural, of course,
and this area is historically economically depressed. We get injections
of money into this area primarily through tourism. It is
(15:39):
one of the driving forces. And so most of the
businesses in this entire county get You know, we have
booming summers where our population with tourism increases exponentially. Our
town population is only seven thousand, the entire county population
is twenty seven thousand. I mean, very sparsely poppedup related.
(16:00):
We have a lot of trees and rivers, not a
lot of people. And in the summer, in July, our
town population can go up to thirty thousand with people
coming to explore the beaches and so forth. So those
tourism dollars are what keep this local economy going primarily,
and every business is affected positively by the influx of tourism.
(16:22):
My demographic, you know, we we're a small restaurant, we're
right on the beach. We have incredible local support, our
local community. Really, they're here for us and we're here
for them. But there just aren't enough people locally to
sustain all of our restaurants and hotels and so forth.
So that influx in the summer keeps us flowing all year,
(16:44):
even though it's only you know, a part of the year.
And the tourism, you know, we're expecting a twenty nine
percent decrease in international tourism in the summertime. Governor, my
demographic is between seventy five and ninety percent tourists visiting
my restaurant. And that's not just my restaurant. Those are
the numbers I have real you know, tangibility in but
(17:05):
it's every restaurant in this area. And when we take
up to ninety percent of my cash inflow, decrease it
by about thirty percent do to specifically and directly because
of the tariffs. That's something that you know, we're having
trouble anticipating how we're going to navigate that. And the
(17:26):
other part of that, of course is cost of goods
and services. We run a New Orleans you see the
sign behind me here, New Orleans Cajun and Creole style restaurant.
So the bulk of my menu we make everything from scratch,
so we're using you know, whole onions, tomatoes, spices, and
then a lot of seafood and shrimp is expected to
go up. We get a farm report forecast from our
(17:47):
food distributor. Shrimp is expected to increase up to forty
six percent directly because of tariffs. Most of my menu
we can expect to go up about twenty five percent.
This is tomatoes, onion, garlic, spices, just everyday things. And
while we can adjust, of course, we'll have to increase
(18:07):
menu prices, as will every restaurant everywhere. So we can increase,
and that feels it makes me sad for my local community.
But then when we decrease the tourism coming in, it's
a double blow, and not just a double blow, but
has that ripple effect that goes far and wide. If
I speak only to my community, this rural community, whose
(18:29):
sports teams you know, Little League and the marching band
and different things rely on the local businesses supporting them,
and this economic impact is so far reaching. I'm an
eternal optimist. I'm always someone that figures things out and
we look for, you know, solutions. This one is more
(18:50):
difficult to see our way through it at this time.
Speaker 1 (18:54):
Well, I appreciate you said two things that are important.
You talked about community. I mean community at the end
of the day, you it's not something you can manufacture.
It's a sense of pride. It's that connection to as
you say, these organizations and your neighbors, where magical moments
are created in your restaurant and friends and relationships are formed,
and you're such a big part of that and a
(19:16):
vibrant part of that. But you also highlighting something that's
often overlooked, and that is tariff's impact tourism, and people
don't necessarily connect that dot as easily as they should
or as consequentially as they must. And when you say
twenty nine percent, was that analysis that was done by
your regional chamber or is that on the basis of
(19:37):
what you're already seeing in terms of decline of visitorship
that you would otherwise expect this time of year.
Speaker 5 (19:43):
This time of year we would start seeing a lot
of international tourism, a lot of people from Europe in particular.
Later in the season we see a lot more Asian
tourists coming in. But you know, as you said, Redwood
National Park, which is here, draws people from all over
the world. We have the mainly one percent of old
growth redwood, and that is really something to see. So
(20:04):
my twenty nine percent came from the economic forecast, out
of the larger chamber anticipation for how that's going to impact.
And you know, in this rural agent of the region
of the world that I'm speaking to my county specifically,
but this whole North Coast is very rural, and so
there's about five counties that all see the same economic impact,
(20:26):
and it's this entire northwest region of California, Humboldt County,
mill North County, Mendocino County, Lake County, Trinity. You know,
it's a huge portion of the state that is going
to feel and real from the effects of a lack
of people wanting to come here directly because of the tariffs.
Speaker 1 (20:45):
So, you know, you've weathered a lot. You got through COVID,
which is extraordinary. You've got that entrepreneurial energy and as
you said yourself, and it's self evidence to anyone listening
you're watching, got such a spirit of positivity. I mean,
what how do you how do you sort of game
this out? I mean, what's what's the strategy for you?
Speaker 2 (21:08):
Is?
Speaker 1 (21:08):
Are you looking at potentially layoff so you can only
pass through so much cost obviously on the customer side,
if they're not coming in the fixed costs of devour
even any any variable menu prices, what what's what's what's
their strategy? What's your How are you gaming this out
in the next few months?
Speaker 5 (21:27):
Yeah, well, you know it's a day by day what
where can we pivot? Where can we pivot? Restaurants historically
have a very tiny profit margin, and as a small business,
as our most businesses in my community, we don't have
the luxury that chains have to be able to absorb
some of that impact because of other stores. So how
(21:48):
do we navigate that. Of course, you know, increasing as needed.
We don't like to do that, but things happen. Cutting
costs wherever we can, cutting labor. You know, we as
owner operators, we work fifteen hours a day laboring in
our restaurant and it's a labor of love. I don't
say that with anything except gratitude, but there are only
(22:10):
so many hours in the day, and so looking you know,
it adds more work to the people that we employ.
So the way we're navigating this is looking at other
ways we can bring money to the restaurant, so creating
other events, you know, community events, things like that. Always
looking at what's working and trying to trim what isn't working,
(22:31):
really making our menu hyper efficient. We got our restaurant
two days before the COVID shutdowns and so it was
a incredible lesson in business management in a very short time.
And so we've learned to pivot. But that's not always
easy when things are changing so rapidly, and as we're
gearing up for our summer season, you know, it's really
(22:53):
just again becoming hyper efficient, hyper educated. We rely on
what's called the farm report forecast, so we can look
at where we can trim costs. You know, at some
point in the day there's only so much we can do,
and then we just try to write it out with
the support of you know, our community.
Speaker 1 (23:14):
Well. I appreciate and I appreciate what you're doing, how
you are representing not just yourself, but your community and
others that are struggling with this new reality as well.
And anyone that gets up to Crescent City and if
you haven't been, you got to go, needs to go
to your restaurant. What's the name of the restaurant.
Speaker 5 (23:34):
It's a Schmidt's House of Jambalaya. We're right on the
beach at South Beach, and it's an extraordinary community. We're
very thankful to be part of it.
Speaker 1 (23:43):
And go up when you're up there and visit and
say hello. Really appreciate you taking the time, thank you
for sharing your insight, and thank you for staying the
course and being so positive. And we're going to work
our tail off to try to curtail the impacts of
these tariffs and lack of I think understand standing of
the impacts it's having on people like yourself and communities
(24:03):
all throughout this country, but certainly here in this north
part of our state. Thank you so much for joining us.
Speaker 5 (24:08):
Thank you, and I just want to add, you know,
I really feel advocated for I appreciate your leadership. We
appreciate your leadership and everything that you're doing as a
voice for the people. Thank you so much.
Speaker 1 (24:17):
I'm grateful. Thank you for joining us. Thank you.
Speaker 4 (24:25):
How you doing, Governor?
Speaker 1 (24:27):
Oh good man, you're well. You're Chino, California, right, Yeah.
Speaker 6 (24:31):
I live in Orange County, California. My company here is
in Chino. We also have a warehouse and location in Amsterdam,
in Holland.
Speaker 1 (24:39):
I love it. And so tell us about your business,
the wheelchair business. Huh.
Speaker 6 (24:43):
So, we are in the durable medical equipment business, primarily
related to wheelchairs and scooters.
Speaker 4 (24:50):
We provide, you know, the product.
Speaker 6 (24:53):
For people that are either permanently or temporarily disabled, including
organizations such as Think on my Emails, the Steve Gleason Foundation.
He was an x NFL football player for the New
Orleans Saints. So we sell our product were wholesaler, so
we wholesale them worldwide, and we've been doing this for
(25:14):
quite some time, about eight years. We're conservably growing company.
We typically grow about two to three hundred percent perannum. Wow,
it's a very expensive business. It's not a business that
is for the lighthearted. So it requires quite a bit
of capital to operate this kind of company, and you
have to have a passion for it, which is something
that myself and all of our team members we have
(25:37):
a great passion for what we do.
Speaker 1 (25:38):
And Joseph, how many countries are you exporting to? How
many countries you're working with?
Speaker 6 (25:44):
So because we have the European operation, we can export
to Belgium, Switzerland, Germany, the UK and of course the
Netherlands at the moment in America from here we export
to Canada and parts of Mexico and you know Puerto
Rico which is still part of part of US.
Speaker 1 (26:03):
So what I mean, so these teriffs are announced, I
imagine you know, you had to anticipate something might happen
in this space. Tell me a little bit about that
thought process. You know, when Trump gets elected, he was
pretty clear that he was going to move in this direction.
Did you expect it as quickly? Did you expect it
as acutely? How has it impacted your business and your
(26:24):
and your business plan going forward?
Speaker 4 (26:26):
Yeah, so wonderful question.
Speaker 6 (26:28):
We we did have a feeling that this could happen,
we didn't expect it to be as drastic as it has.
And the reason for that is based on the fundamental
sort of principle that our industry has been exempt from
tariffs since we've had the operation. So even though we
expected tariffs to apply, we did not expect that they
would be applied to our industry as we've been exempler
(26:51):
for all of these years. Nor did we expect that
if they were going to be applied, that it would
be as high as they are. So probably about eight
months prior to this, I had set up a separate company.
Part of the election of Donald Trump. We had separate
separate company with the idea that we would manufacture our
(27:11):
own products within the US, and so we started discussing
things with even Chinese partners. Meet these partners Mexico went
down to Mexico many times to set up a Mikhilidora
down there, thinking that my work went to Texas, went
to various states. What we realized the governor is that one,
the cost of operating in America is still extremely expensive
(27:34):
number one. Number Two, securing and obtaining the materials that
we require are extremely difficult to find we might be
able to find some metals, some aluminum, but things like
carbon fiber or things like lithium. I own batteries, things
like technology that goes into our joysticks. You know, we're
sort of a highly you know, automated business to a
(27:55):
certain extent that relies on technology. And what we quickly
found is that what we require fired just wasn't available.
It wasn't available as we needed it, and we thought, okay,
this is probably something that the United States isn't quite
ready for as yet. So when obviously the terriffsupply were applied,
(28:17):
you know, it drastically affects our ability to trade. You know,
I mentioned in my email that we're working with quite
a large community that is quite vulnerable, whether it's the
geriatric community, which someday, as you know, governor we live
long enough, we might all be in a wheelchair or
(28:38):
a scooter. But in addition to that, you know, we
deal with like the Gleaston Foundation, which has you know,
their members are they have als. We work at a
mass organizations patients that have Parkinson's et cetera. So not
only are they in a in a situation help wise
that is not ideal, but any of these folks just
(29:00):
don't have the resources, financial resources to secure the.
Speaker 4 (29:04):
Product that we sell.
Speaker 6 (29:05):
And although we are we sell our products relatively and
expensively compared to the market, it is still you know,
a necessity for them. And unfortunately, you know, with with
the terriffs as they currently stand, you know, it's it
becomes almost an impossibility to be quite honest, you know,
(29:27):
I'll give you a real number or real numbers. We
had ordered sort of a few containers here recently that
were we expected to pay about six hundred grand for well,
with the tariffs applied, it's now an additional eight hundred
and thirty thousand on top of that.
Speaker 1 (29:42):
And so let's just want to make that clear. It's
not from six hundred thousand to eight hundred thousand, it's
an additional eight.
Speaker 4 (29:49):
More than that's correct, that's right.
Speaker 1 (29:52):
And that and that was most of that product coming
from China specifically.
Speaker 4 (29:56):
That's right.
Speaker 6 (29:57):
Yeah, that's right. So you know, it's in the day
eight hundred and thirty thousand. So our choices are and
in our industry, we you know, I'm not a I'm
not backed by private equity. I don't have any VCS
behind me. We are we are operating ourselves. We've grown
this company ourselves out of our own resources. So you
(30:18):
know the idea of pain and additional eight hundred and
thirty thousand when we don't know if these tarifts are
going to change tomorrow. You know the story, it's been
up and down. Yes we're going to reduce tariffs and
no we're not. So it's very unpredictable for myself and
other companies in my situation. If we fund that money,
(30:39):
you know, obviously we would need to recover it somehow,
and unlike a common belief that the exporting company pays
for these things, it's just not true. I mean, the
import for us, we would pay that additional amount, and
then we would have the decision to make do we
pass it down to our consumer, which is in our case,
our reseller for World Blae, or do we absorb the costs. Well,
(31:02):
there's no business that I've been in. I mean, you
were in the wine business.
Speaker 4 (31:05):
You know this.
Speaker 6 (31:05):
There's no way that the company can operate with an
additional one hundred and forty five percent tariff.
Speaker 4 (31:11):
I mean, your.
Speaker 6 (31:12):
Operating income is just not there. So you know, it's
sort of devastating to us to to on many different levels,
but most importantly on the level of the consumer, particularly
the ones that we serve, because you know, when you
when we deal with nonprofits, you know they they have
a limited budget, and so what it now means is
(31:34):
that do they not get the chair or do they
get you know, a third or twenty percent of what
they require.
Speaker 1 (31:39):
So Joseph, I mean, did you end up making the
purchase or you just you know, you just you're waiting
around with all that uncertainty. What'd you do?
Speaker 6 (31:46):
We wait right now because we have sufficient inventory to
cover us fortund maybe four.
Speaker 4 (31:51):
Months, that's it.
Speaker 6 (31:53):
But you know, with lead times, et cetera, we really
have to have those containers shipped within the next fifteen
to twenty days otherwise we're going to run out. So,
you know, it's it's operating a business obviously, as you know,
this is not always going to be you know, rosy,
if it was, probably every way would do it. That's
(32:14):
just not the way it works, and you're in a
game that's probably even tougher in mind, but the reality
is that, you know, you have to kind of deal
with the cars as they are presented, and right now,
I think what is hurting many of us.
Speaker 4 (32:29):
In addition to the tariff.
Speaker 6 (32:31):
Is the uncertainty and the you know, for lack of
a better word, the flip flopping of is it going
away or is it saying right? And and so you know,
we have a real urgency in our industry because of
the necessity to satisfy the demand.
Speaker 1 (32:50):
What do you, Joseph, just out of curiosity? And you know, look,
when you put everything on the line, all the risk
you leverage. You talk about how capital in tense? Have
you just proved that point is where like to you know,
just those kind of those purchasing orders that you're making
and the bet you're placing. But how do you how
do you even talk to your employees? I mean, what
do you tell these guys? What do you tell your
(33:11):
folks around you? And as you say, I mean you
talk about the most vulnerable what you're doing for charities
and nonprofits, and I think that really paints a pretty
powerful picture. But what what's the anxiety level within the company,
within the organization.
Speaker 6 (33:27):
So we're very transparent a lot of the guys that
you know, I've owned several companies in my career. In
this particular one I brought in a lot of guys
that I've worked with for eighteen to twenty years, so
they're friends there.
Speaker 4 (33:39):
Most of them were either.
Speaker 6 (33:40):
Professional athletes or along the lines of playing at university, baseball, football,
you name it. So we're all highly competitive, and we
all our manner of operations were very direct in terms
of how we speak to each other, so they're well aware.
And there was a point that, you know, a conversations
had we said, guys, look, if this, if this is
(34:02):
the way it's going to be, I cannot promise everybody's job.
It's just not conceivable, let alone my own, let alone
my own company, right because if if this were to
carry on, you know, for the next twelve months or so,
I just can't imagine anybody in our industry that's playing
on a level plane field would be able to operate.
(34:24):
It's just it's just not possible. So it's a it's
a really concerning thing. And I know I'm taking up
airspace here, but if you don't mind me just saying, also,
had we you know, if we had the infrastructure in
America to do this, you know, in terms of what
I mentioned earlier, the batteries, the joysticks, the aluminum, the
(34:45):
ability to do this, and we had the resources of
being able to kind of operate this business, which I mean,
it's not inexpensive. You know, it would require several several
million dollars to operate a manufacturing company. You know, I'm
not opposed to that. I'm not opposed to actually trying
this out, but I will say this, given them my
(35:05):
experience is that even if we were to do that,
you know, a wheelchair that might cost somebody today twelve
hundred dollars isn't going to cost twelve hundred dollars tomorrow.
You know, if we're manufacturing this, it's going to be
you know, twenty four to twenty five hundred dollars.
Speaker 4 (35:18):
Yep.
Speaker 1 (35:19):
So the bottom line I mean, and I appreciate at
the end of the day, the bottom line is the
bottom line, and one ask to soberly sort of understand
the consequences the benefits obviously of bringing those supply chains
back home, the opportunities and the jobs creating that. But
from the consumer perspective, that's that's pretty stark increase in
(35:40):
a reminder of the trade off as it relates to this. Look, Joseph,
I appreciate you painting that picture. Thank you, for highlighting
some real world impacts that are acute and immediate, and
also just the deep uncertainty as we wait day to
day and as you suggest, it's you know, it changes
day to day, the flip flop, the lack of certainty.
And as a business owner myself and I appreciate that
(36:02):
reference certainty is the coin of the realm. At least
you can work around that and you can make some decisions,
but the inability to make decisions is perhaps to me
the most stifling, and I think for you, you know,
I can't imagine the most alarming part of.
Speaker 4 (36:20):
All of this.
Speaker 6 (36:21):
Yeah, no doubt, uncertainty plays a huge part. And you know,
we were trying to represent a company that is American
based and grown, and you know, again we take great
pride in what we do. You know, there's a lot
of stories here of individuals that have family members that
require what we do. And it's just extremely frustrating, you know,
(36:46):
to sort of be in a situation where we've grown
and developed such a reputable organization and find ourselves in
a situation that is completely out.
Speaker 4 (36:56):
Of our control.
Speaker 6 (36:57):
Yeah, you know, we're really just we have no control
over this portion of what we can do well.
Speaker 1 (37:05):
Appreciate it. But you know what, it's the fact that
you're willing to share that story gives you agency, gives people,
I think, a deeper understanding of what's at stake. You
and thank you Joseph as well. You only reinforce the why,
the why. I'm proud on behalf of you and forty
million of us. California was the first state in the
(37:26):
country to sue the Trump administration as it relates to
his authority on these tariffs. And by the way, I
am damn confident we're going to win that and we're
going to get clarity on that in the next few weeks.
So I really appreciate you willing to share your story.
Thanks for all the good work, remarkable work you're doing,
how you're changing lives, for your charitable focus, not just
for your entrepreneurial spirit.
Speaker 4 (37:47):
Yeah, thank you for that.
Speaker 1 (37:48):
Take care, Thanks so much for joining us.
Speaker 4 (37:49):
You're welcome. Thank you so much.
Speaker 1 (37:51):
Appreciate Hey, Jennifer, Hi.
Speaker 7 (37:54):
Hi, Gavin Nissam, how are you doing.
Speaker 1 (37:56):
I am good where you're in the great city of
Palm Springs.
Speaker 7 (38:00):
Right, this is correct, this is correct.
Speaker 1 (38:03):
I love it. And tell me a little bit about
your business when you opened it up, and how you're
feeling about everything right now.
Speaker 7 (38:11):
Well, thank you.
Speaker 8 (38:12):
Thank you again for taking the time and allowing us
to share what's happening with small business right now. So
my name is Jennifer Gold and I'm the founder and
curator of Grounded Bodyworks boutique while Miss Spa based in
Palm Springs.
Speaker 7 (38:29):
We're celebrating our thirteenth year this summer.
Speaker 8 (38:33):
And when I started, there was just me and one
of my massage therapists that I actually taught massage. I
was the director at a local school for a minute
and hired her and it was just us for a while,
and now I have a team of twelve, and goodness,
(38:54):
it's just been it's been kind of a whirlwind. I've
learned a lot. Leading up to COVID, I think under
goodness Obama, our business was grown, growing steadily year after year,
and then the pandemic hit and that momentum.
Speaker 7 (39:10):
Has just gone overnight.
Speaker 8 (39:12):
Yeah, you know, And if I could take a moment
to just personally thank you for your support during COVID,
I took the grant I have the eed Alan I'm
currently repaying. Made the difference between closing our doors and surviving.
Speaker 1 (39:26):
So thank you, oh, thank you for that. So is
this I mean, Jennifer right now, I mean forgive me
for cutting off because I think it's an interesting I mean,
the fact that you went through that experience in the
trauma personally, professionally as it relates to COVID. How is
this moment Does it bring back those memories? Is it
(39:47):
on par with that? The uncertainty, the impacts to your business.
Speaker 8 (39:51):
It's definitely uncertain. The struggles are very real. There's still
very real. I can't believe it's been five years. You know,
we're still recovering. For many of us, it's fragile and
these tariffs could be the thing that pushes us over
the edge.
Speaker 1 (40:05):
And how are the tariffs directly impacting the work there
is I imagine? I mean, we've we've been reading a
lot all over the national news Palm Springs reaching out
to Canadians. Two million Canadians last year visited the state
of California. Palm Springs one of the biggest beneficiaries of
the number of tourist dollars spent. Has that had an impact?
(40:27):
Is it more direct in terms of supply chain and
materials that you're using at the spot give us a
sense pink the picture.
Speaker 8 (40:35):
Sure, sure, so there's I'd say there's like three three
caveats that are that I'm experiencing right now personally. And
then with my business, I'm just on a spending freeze.
Speaker 7 (40:49):
We're afraid.
Speaker 8 (40:49):
I'm afraid to invest As a business owner, I've paused
all major purchases. I want to invest in growth, but
right now then certainty is just too great. Our customers
are also hesitant. Even in an affluent area like Palm Springs,
people are pulling back on non essential spending that slows
everyone down.
Speaker 7 (41:10):
I'd love to partner with Hydrofacial. It's a long beach.
Speaker 8 (41:14):
So I'm from Compton, my family's from Quebec. So you
know what I do with Grounded is I promote all
these local businesses from la where I'm from, all the
way to Quebec where my family's from. I'd love to
bring in Hydrofacial, this California brand and manufacture, but the
machine costs over a thirty thousand dollars. I'm not about
(41:36):
to invest in that right now, you know. And then
I'd say the next thing would be our vendors, even
like our skincare line is Oseia in Malibu. I'm sure
you've heard of them, women owned brand based in California.
Their ingredients and operations are all local, but that doesn't
(41:57):
make them immune. If griffs increase the cost of imported
packaging materials glass, you know they have glass, but there's pumps,
there's lids. It affects pricing. That increase comes to me
and then it's passed on to my customers. Even if
we're doing everything right and we shop local. We support
(42:17):
Californian companies staying sustainable as we can afford to do that,
but local, I'm sorry, global policy is still hitting our
bottom line. And third, it's been a very emotional two months,
but a month and a half saying goodbye to our Canadians.
(42:38):
You are correct, Ron DeHart our manner just send out
an email addressing this Palm Springs is amazing. They've been
really trying to help support Canada. They just hung all
these banners downtown just to show our support. There's all
these Canadian flags.
Speaker 7 (42:54):
It's beautiful, but it's been very emotional.
Speaker 8 (42:56):
Every spring we say goodbye to our Canadian visitors. Your
many have said goodbye for good. Some have sold their homes.
They're not rebooking. These guests have supported us three years,
including through the pandemic. Their absence this year is emotional
and financially crushing. They spend They bring in three hundred
(43:17):
and two million just to Palm Springs or the Coachella
Valley alone. Palm Springs is deeply tied to Canadian tourism
and if we lose our small businesses and are left
with only big box stores, we'll lose the very character
of our city.
Speaker 7 (43:34):
I mean, we're still recovering. You know.
Speaker 1 (43:36):
Well, thank you for pinning that picture of Jennifer. It's
you know, in California, we were launching a multimillion dollar
campaign to encourage Canadians to come back to Canada. Campaign
we announced a few weeks ago saying, you know, California
wouldn't be California without Canadians. But it's the response to
was interesting. People are very raw and emotional about it.
(43:59):
And even the California is not you know, it's not
maybe the most untrumped state in America. The state of
mind is still a tremendous animus from the damage we've
done to the relationships up north, and I imagine just
for you. The emotion is extended to just family you
have up in Quebec, right.
Speaker 8 (44:18):
I have one aunt left up there. The rest of
the family moved to the States in the seventies and
she just couldn't leave her horses day, so's she's still
up there. But it's really you know, my vendor friends
were communicating, we're trying, We're trying to make it work.
Speaker 7 (44:36):
I only have two Canadian vendors right now.
Speaker 8 (44:39):
But if I may give you an example, are nail
so I run a spa, a boutique spa in Palm
Springs and name we offer nail services in our vendor
for our nail products. Or in La it's called Cot
and she's redoing her line. A lot of the packaging
(45:01):
is from China. So because of these tariffs, I've been
rethinking do I stick with coat, you know? And then
there's a line up in Canada called Behind and they
have a nail line and it's made in Canada.
Speaker 7 (45:16):
But again, I just feel.
Speaker 8 (45:18):
Like I'm going to lose, lose, you know, just trying
to stay local but make it all work well.
Speaker 1 (45:24):
Jennifer, I really appreciate you putting in a human face,
your own humanity behind this, and I extend that humanity
quite literally your support for others in the region, other
small businesses. And I think it's so insightful and helpful that,
as you say, even locally made products have packaging components
(45:44):
and other component parts that they have to import, and
those costs are burdens that ultimately will be passed on
to you and potentially your customers. And it's such a helpful,
I think, insight to understand the impacts, the cascading impacts
of these terrafts, including obviously the tourism component that compounds that.
(46:05):
But what you said, I think is the most damning.
It's just the level of anxiety that you have to
personally go through, professionally go through, and as a consequence
of that anxiety and unwillingness to make a big, bold decisions,
which are decisions often you have to make with some
confidence about the future and what it will hold. And
(46:25):
so thank you for sharing your story. Thank you for
weathering a lot of storms. I'm confident you'll continue to
and I think it's a big help for those watching,
in those listening.
Speaker 8 (46:37):
I appreciate that. Thank you again for all your support.
Couldn't have chosen.
Speaker 7 (46:41):
A better state to be in right now, So thank
you again.
Speaker 1 (46:45):
We're gonna we're gonna take it to the Trump administration
and we're going to beat back these tariffs. You watch,
we have our day in court quite literally coming up
very surely, Jennifer, thanks so much for joining us.
Speaker 7 (46:56):
Thanks so much, Thank you very much. The Song of
ADM
Host
Gavin Newsom
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