Effects of tariffs on textiles

Well, I woke up to some greeeeaaaaat news from a few of my fabric suppliers.  Since I like to run Aria Couture with as much transparency as possible, here is another oh-so-fun business post.  Sarcasm is dripping.  March of next year will be 19 years that I’ve had my small business.  It has been through a recession.  It’s been through me being homeless.  (Try sewing without a home–it’s incredibly difficult.) It’s been through me being very sick.  This is the first time I’ve genuinely worried for the future of Aria Couture.

Due to anticipated new tariffs, pricing of fabrics is going up, or, in a couple cases, went up overnight.  The National Council of Textile Organization is actually pushing FOR tariffs, despite the lack of infrastructure in place in America to take over production.  The list of items about to be hit with new tariffs is disheartening.  It includes not only fabrics, but a lot of supplies, including things like bobbins, plastic spools, cardboard spools, thread, all kinds of eyelets, yarn (do you like to knit or crochet?), and more.  Even diaries and journals and notebooks are on the list.  Companies and importers aren’t going to eat these costs.  They’re going to get passed along to the next in line.  This means that I will pay more to buy supplies.  Small things like extra tariffs on needles (they’re metal, and metal is already hit) and corset boning (steel, also already hit) are not overly difficult for me to absorb due to the relatively low cost (an extra $20–steel is a higher tariff–for corset boning  isn’t a make-of-break for me), but fabrics are another matter.

Fabrics are already expensive, and when using many, many yards (I’ve used as many as 300 yards in some gowns), even a dollar per yard very quickly adds up to quite a hit.  That would be the added tariff on fabric that is $10 per yard at a tariff of 10%.  Unfortunately, most fabrics I use aren’t as low as $10 per yard since I use mostly natural fabrics, like silk, which is already notoriously expensive, and I use high quality silk.  No, all silk taffeta isn’t the same.  The bolt pictured is silk taffeta that is sitting in my supply room.  Let’s say I use that fabric for a regency gown, and use five yards.  At a 10%-tariff, that’s an extra $50.  Remember when I broke down the costs of a dress to figure out the hourly wage?  Let’s do that again.  There is a huge reason for this.

Since I compete with seamstresses who use the cheapest available (I don’t because quality is a huge issue for me) and are willing to take just a few dollars per hour, I can’t charge more than I already do.  Typically I charge $400 for a regency round gown in silk taffeta.  At $50 per yard for five yards, this is $250.  At a payment processing fee of 3.5%, that’s $14.  Social security tax is 12.4%, for another $49.60.   I’m down to $86.40.  Due to how much hand-sewing silk taffeta needs, such as hand-sewn hems, I can spend 8-10 hours on a gown fro drafting to finish.  On the lower end, 8 hours, That’s $10.80 per hour in a state with an $11-minimum wage.

But…increase the cost of fabric by 10%.  That’s an additional $25 out.  So I’m at $61.40 for labor, which is $7.67 per hour.

I said there is a huge reason for this breakdown.  Textile companies are already raising prices in anticipation of tariffs being approved.  And it’s not at 10%.  Here is the old versus new pricing of one of the lower-priced fabrics I use.

  

This is what I woke up to.  Depending on whether I buy 1 yard or a full bolt, this is an increase of between 29% and 44%, and yes, it is in response to the tariffs according to the emails sent out about this.  Yes, this is higher than 10%.  A little known fact is that the US is one of the world’s top exporters of raw cotton and raw wool, and when that goes into some of these countries, like China, it’s getting hit with tariff, which raises the costs for manufacturers there.  Even without US-added tariffs, this alone would increase prices here.  But when the finished yarn and fabrics are sent back here, it’s getting slammed with higher tariffs (textile tariffs are already typically between 14% and 62%…yes, 62%…and these new tariffs are on top of that) on a higher cost.  This is double-tariffing, if not triple in some instances.  Tese higher rates are potentially disastrous.

Let’s apply a difference of 29% to my little breakdown above on the assumption that this will be the new normal.  Instead of $250 for fabric, that would be $322.50 for fabric.  That leaves $13.90 for labor, which is $1.73 per hour.  My options would be to work for that little, or to raise the cost of that gown by $72.50, or try to find middle ground.  Commissioners don’t take kindly to increases in costs.  I’m still competing with people using the cheapest supplies and who are willing to work for peanuts.  For some brevity, $13.90 is enough to Amazon Prime a container of peanuts with $1.81 left over.  Literally peanuts. Wages for most Americans is either stagnant or falling.  How can I raise prices when wages aren’t going up?

Thankfully, I have some time to figure things out thanks to doing something that other seamstresses told me was a waste of money.  Why buy more than is needed for current commissions?

This is some of my stash.  The case to the far right there is all silk, and the rest are cottons, all bought at prices not yet affected by tariffs.  So I can keep my prices stable for a while.  But after that, I just don’t know.  If I’m lucky, fabric suppliers will only raise prices by 10%.  I can justify doing this for $7.67 per hour.  But $1.73 per hour is too close to the line that there’s a risk I’ll lose money, especially on Etsy sales (the fee just rose to 5% and includes 5% of shipping, so take out $20, and I’m losing money out of pocket).

By the way, don’t think that store-bought clothing is safe.  These tariffs apply to that as well.

I don’t know what to do, folks.  I can keep prices as they are until I’ve gone through my stash, but beyond that, what should I do?  I just don’t know.  Since this has the ability to affect everyone reading this, I think it’s only fair to welcome input, whether through comments below, through my Contact page, or through my Facebook page.  Should I raise prices?  Keep them the same?  Compromise on quality of fabrics or production?  Keep everything as is and hope for the best?  Please let me know your thoughts.  Thank you.

6 thoughts on “Effects of tariffs on textiles

  1. Annissa

    I never thought about simple sewing supplies going up. I knot and I also spin yarn. Depends if there will be an increase in wool , since most of it comes from over seas.

    • aria

      If you read over the list, it gets down to the small things. Most knitting needles and crochet hooks are aluminum or steel, which is already getting hit at between 10% and 25%.

      Regarding yarn and fabric coming from overseas, what a lot of people don’t realize is that the US is one of the world’s top supplier of raw cotton and raw wool. So we grow it, send it to China, which now has retaliatory tariffs going that way, then it’s make into yard of fabric, and sent back at a higher cost due to the tariffs on it going into China, and then tariff’d again coming back. We’re getting at least two layers of tariffs.

      I encourage people to stock up NOW, before prices have a chance to go up. If we’re lucky and the tariffs don’t go through, then the worst case would be having a stash. But if it does, which is so likely that supply prices are already reflecting it, then you’ll be cushioned from the blow for at least a short time.

  2. Lisa Johnson

    I would say don’t panic! I found this information to be very informative. A lot to think about for sure. I do agree if everything goes up you will have to raise your prices. If you have clients now, then repeat customers will continue to return.

    • aria

      I agree! Apparently Trump and the EU are working to lower *some* tariffs now, but it’s not enough. The US economy, and economies of other countries, are still taking a beating.

  3. Dawn

    You ARE prepared for this transition in both experience & stock.

    Raise your prices.

    Do what you can until you can do more.

    Learn from those who prospered during the 1930’s Great Depression & other depressions while others closed down OUT OF FEAR & SHORT-SIGHTEDNESS –

    The money is still out there & is only changing hands & people still want to spend it on HIGH-QUALITY! Be there for them!

    More jobs are being created as more businesses move back to the US which in turn will create more wealth & more businesses! Win-Win & CHA-CHING for you!

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