‘We can't eat 30% of the cost.' Price hikes from Trump's tariffs are coming for back-to-school and holiday shopping.
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Jimenez wouldn't say how many pairs she sold, only that it was fewer than last year.
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'I've never raised my price, so it was really hard on me because I know they don't have to buy my socks. They can literally go to Target and buy $3 socks,' said Jimenez, who predominantly sells to Catholic school students and has eaten most of the tariff increase. 'It was just because of a horrible decision by our government, and that is making it so hard for us.'
Consumers around the country are starting to face a similar tariff reckoning
while business owners wrestle with the same disheartening decision: whether to raise prices, and by how much, or delay inventory heading into the back-to-school and holiday shopping seasons.
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A promotional photo for Scholar Sox, which contributes a portion of each sale to scholarships.
Scholar Sox
Most imports must be ordered months in advance because of lengthy shipping times. That has led to a delayed reaction to
The April 9 pause was set to expire on Wednesday, but
'A lot of folks took the opportunity to frontload and bring product in to kind of stock up before tariffs were put in place, and a lot of that inventory is starting to run out or has run out,' said Jonathan Gold, vice president of supply chain and customs policy for the National Retail Federation trade group. 'As that stock gets replenished, that new inventory is coming in and has that tariff rate tied to it. So that's when you'll start to see some of those price increases.'
Trump has falsely claimed that exporting countries pay the tariffs when they are actually paid by US importers when the goods arrive here. He has also asserted any costs will not be passed on to US customers. In May,
'The administration has consistently maintained that the cost of tariffs will be borne by foreign exporters who rely on access to the American economy, the world's biggest and best consumer market,' White House spokesperson Kush Desai said in a statement. He cited a
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But the Federal Reserve and many economists are forecasting an acceleration in inflation in the second half of the year as tariff-related price hikes begin taking effect.
'It takes some time for tariffs to work their way through the chain of distribution to the end consumer,' Federal Reserve Chair Jerome Powell said in June. 'We're beginning to see some effects, and we do expect to see more of them over coming months.'
Spencer Murdock poured cumin into a grinder, nicknamed 'Bertha,' at the Curio Spice Co. factory in Winchester.
Craig F. Walker/Globe Staff
The
Still, even after moving up purchases, Curio Spice doesn't have enough on hand at its factory in Winchester to make it through the rest of the year. That includes the crucial October-through- December holiday season when Curio Spice also has a pop-up shop at the
The spices it's ordered since then could be hit by higher tariffs that kick in before the shipments arrive.
'We're trying really hard not to raise prices,' Olivari said. 'Our products are already not the most inexpensive products in the world, and we want to be able to continue to support those farmers in that manner.'
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So Curio Spice is looking at a combination of some price increases and reduced inventory the rest of the this year.
'If we run out of something, my hope is that people can understand,' said Claire Cheney, the company's founder and the 'blender-in-chief.' She also will suggest substitutes, such as allspice berries or clove buds instead of bay leaves, to try to keep customers.
'I don't think we're going to go out of business,' Cheney said. 'But it will severely impact our growth and our opportunity to introduce new products and to develop new blends.'
Claire Cheney, founder and blender-in-chief at the Curio Spice Co. factory in Winchester.
Craig F. Walker/Globe Staff
Jim Rooney, chief executive of the Greater Boston Chamber of Commerce, said the tariff uncertainty is adding up to a lost year for many businesses when it comes to expanding or hiring. He noted that toymaker
'There's an expectation, maybe grounded in hope, that . . . six months, a year from now, this will all be over,' Rooney said of the tariffs. 'But there's no guarantee of that.'
Trump has said the tariffs are partly designed to lure more manufacturing back to the United States. But some products just can't be made here. Shortly after Jimenez started her company 11 years ago, she looked into producing her socks in the United States. But it was much more expensive given the handiwork and she would have had to charge nearly triple the price.
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President Trump announced new tariffs in April.
Mark Schiefelbein/Associated Press
George White, chief executive of
'They're all handmade. It's super labor intensive,' he said. 'There's nowhere else to make them in the world.'
The company does about a quarter of its business during the holiday shopping season and placed its order in May, not knowing what the tariffs on China ultimately would be. In early May,
'We are assuming that we're going to have a 30 percent tariff when it comes in,' White said. But given Trump's continual shifts, the actual tariffs when the products arrive between mid-August and mid-October are anyone's guess.
Given
the weekslong overseas shipping times, the tariffs can be dramatically different when the products arrive compared to when they were ordered.
Containers and cargo ships at the Port of Ningbo-Zhoushan in Ningbo, in China's eastern Zhejiang Province.
HECTOR RETAMAL/AFP via Getty Images
Then it's up to US business to decide how much of that cost to pass on to customers. White said he's boosting prices about 10 percent — assuming the 30 percent tariff.
'We can't eat 30 percent of the cost,' he said.
Neither can Jenn Luna, owner of
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Manufacturers are eating some of the cost, but Luna said she's still looking at increasing her prices by 7 percent to 10 percent. And all of that could change if Trump revises the tariffs again.
'Stuff that's on the water now, when it arrives, maybe it's going to be 100 percent, maybe it'll be zero,' Luna said. 'Nobody really knows. So we're all just doing the best we can.'
Jim Puzzanghera can be reached at
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The Evolving Competitive Landscape The broader landscape of home services tech is rapidly diversifying. Here's how different players are approaching the problem: Unlike lead marketplaces that charge per connection or click—often regardless of conversion—entrants like Volca, ResponsiBid and NiceJob focus on pipeline ownership. Their pitch: help businesses generate, nurture, and close leads from their own customer base instead of relying on expensive, opaque third-party platforms. Volca's flagship product is an SMS-based referral system that uses artificial intelligence to automatically extract key details from text messages with homeowners, match them to the right business systems within a CRM, aid in automated marketing, and close the loop with secure payments for end to end referral programs. Early adopters have reported up to $70,000 per month in new revenue within six months of implementation, with some customers exceeding $160,000 in total attributed sales. 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Instead, it works in the background to extract insights from CRM data, personalize outreach, and track referrals end-to-end. It's "AI as infrastructure"—empowering time-strapped contractors to focus on the job while the platform quietly grows their business. Not quietly: Early adopters have reported up to $70,000 per month in new revenue within six months of implementation, with some customers exceeding $160,000 in total attributed sales. Other startups are taking similar approaches. ResponsiBid automates bidding for window cleaning and pressure washing services. Schedulicity uses machine learning to optimize service appointments. And ServiceM8 offers automated invoicing and communication tailored for mobile contractors. Home Services Al Companies Positioning Matrix, Positioning based on operational scope vs. customer ... More acquisition focus The Reality Check: AI Adoption Challenges However, the path to widespread AI adoption in skilled trades faces significant headwinds that market projections may underestimate. Recent research from BCG reveals that 74% of companies struggle to achieve and scale value from AI initiatives, with around 70% of implementation challenges stemming from people- and process-related issues, 20% attributed to technology problems, and only 10% involving AI algorithms. The construction and home services sectors face particular barriers. Manufacturing, information services, and healthcare companies report an AI adoption rate of about 12%. Conversely, the construction and retail sectors are at the lower end — with only 4% of companies in these areas taking advantage of AI technology. This stark difference suggests that the optimistic projections for AI adoption in trades may be overly ambitious. A comprehensive survey from Deloitte and Autodesk identified three primary barriers to AI adoption in construction-related industries: A lack of digital skills among employees (cited by 42% of businesses), with this barrier more likely to impact large companies. Additionally, barriers to AI adoption include defining an AI operational model, poor data quality (a concern for 56% of companies), and insufficient employee buy-in. For small trades businesses operating on thin margins, these challenges are magnified. Many contractors lack the technical infrastructure, dedicated IT support, or time to properly implement and maintain AI systems. The promise of automated referrals and CRM integration may sound appealing, but the reality of onboarding, training staff, and troubleshooting technical issues often proves overwhelming for businesses already stretched thin. While the success of this approach is far from guaranteed, early adopters report impressive revenue gains. Of course, what's next is establishing just how replicable these results are across a fragmented industry with wildly varying business sizes, tech maturity, and customer bases. Critics argue that referral automation tools, no matter how smart, may struggle to generate sustained volume in markets where personal relationships and community trust have long trumped digital systems. Proponents, for their part, say these new digital tools are simply providing an accelerated means to that same end: satisfied customers sharing their positive experiences. The skyrocketing popularity of platforms made for home services pros like ServiceTitan, Housecall Pro, and Jobber, may be an indicator of a sector that is ready and eager to adopt modern tools. Small Business Technology Adoption: A Sobering Reality The broader context of small business technology adoption adds another layer of complexity to the AI revolution narrative. While large enterprises may have the resources to experiment with AI tools, small trades businesses operate under different constraints. Despite the increasing adoption of digital technology, small and medium enterprises (SMEs) continue to lag behind larger firms. This technology gap isn't just about access to capital—it's about operational priorities. A contractor spending 60 hours a week on job sites may not have the bandwidth to evaluate, test, and implement new AI tools, regardless of their potential benefits. The "if it ain't broke, don't fix it" mentality remains strong among many trades professionals who have built successful businesses through traditional methods. However, when it comes to acquiring customers and driving revenue, the vast majority of home services businesses are already actively paying for multiple of the following services to grow: advertising, social media, lead aggregators, reviews, etc. Even more, after labor, marketing ranks the largest expense at a home services business, representing 10-30% of ARR. With this in mind, the case could be made that tools like Volca, which are able to effectively consolidate all of these needs into one platform, have the potential to alleviate tool fatigue, time spent managing tech services, and ultimately, the financial burden of trying to keep up with all the different channels to grow a loyal customer base. As tech-savvy millennials replace Boomers and Gen X as home services business owners, we can also expect willingness to engage with new technology to shift toward eager adoption. The challenge is compounded by the fact that 56% of companies cite poor data quality as a major concern when implementing AI systems. Many small trades businesses lack the structured data collection processes necessary to feed AI algorithms effectively. Customer information might be scattered across handwritten notes, basic spreadsheets, and informal text messages—hardly the clean, organized datasets that AI systems require to function optimally. Market Transformation Drivers Several macroeconomic factors are accelerating this transformation: Digital Media Influence: According to Technavio's recent analysis, the increasing influence of digital media is a primary driver of home services market growth, with the global market expected to grow by $6.54 trillion from 2024-2028. Homeownership Trends: The demand for home services is closely linked to rising homeownership rates, with homeowners increasingly seeking professional services for maintenance, renovation, and improvement projects. Labor Market Efficiency: AI systems are improving job matching and reducing both unemployment and under-employment by better connecting workers with opportunities that utilize their specific skillsets. Consumer Behavior Shifts: The convenience economy is driving demand for on-demand services, with consumers increasingly willing to pay premium prices for immediate, high-quality service delivery. Challenges Ahead Despite this momentum, the path to widespread AI adoption in the trades faces significant friction. Many business owners remain wary of technology promises after years of poor results from Google Ads, Yelp, and SEO consultants. Others lack the time, technical fluency, or staffing to trial and adopt new systems—especially when word-of-mouth still "works well enough." Cost remains another concern. While platforms like Volca promise strong ROI, many small businesses operate on thin margins and are risk-averse when it comes to new expenditures. The key differentiator for successful platforms will be demonstrating fast time-to-value, seamless onboarding, and results that speak louder than sales representatives. The Skills Gap Reality The optimistic narrative around AI adoption in trades often overlooks a fundamental challenge: the digital skills gap. A lack of digital skills among employees is cited by 42% of businesses as a barrier to AI adoption, and this challenge is particularly acute in trades where workers have traditionally relied on hands-on experience rather than digital tools. Consider the average HVAC technician or plumber who has built their expertise over decades of practical experience. Asking them to suddenly embrace AI-powered CRM systems, automated messaging platforms, and digital analytics requires not just new tools, but an entirely new way of thinking about their business. The learning curve isn't just technical—it's cultural. This skills gap creates a potential two-tier system within the trades industry. Larger companies with resources for training and dedicated administrative staff may successfully adopt AI tools and gain competitive advantages. Meanwhile, smaller operators who built their businesses on personal relationships and traditional methods may find themselves increasingly at a disadvantage, despite potentially providing superior service quality. What Comes Next The transformation of the trades through AI isn't a flashy disruption story—it's an infrastructure story. Like the electrification of manufacturing or the digitization of accounting, it's about applying technology to make foundational industries more profitable, resilient, and scalable without overcomplicating the core work. "Our customers aren't trying to build unicorns," said Volca co-founder Brendan Kazanjian. "They're trying to build great businesses to support their families and service their communities. Volca gives them the software to do that on their own terms." With the U.S. home services market valued at over $657 billion and experiencing rapid expansion, the integration of AI represents both an opportunity and a necessity. The companies that succeed will be those that understand the unique needs of trades professionals: tools that enhance rather than replace human expertise, platforms that provide ownership rather than dependency, and systems that deliver measurable results without requiring advanced technical knowledge. However, the road to widespread adoption will likely be longer and more challenging than current projections suggest. The gap between enterprise-level AI adoption and the reality of small trades businesses remains significant. Success will depend not just on technological capability, but on addressing the fundamental barriers of skills, resources, and cultural change that define the trades industry. The companies that ultimately succeed in this space will be those that recognize AI adoption in trades isn't just a technology challenge—it's a human challenge. They'll need to provide not just software, but education, support, and solutions that respect the existing strengths of traditional trades businesses while gradually introducing digital enhancement. If the last decade of innovation was about optimizing the knowledge worker, the next one might just be about empowering the contractor. AI won't replace plumbers or HVAC technicians—but it might finally help them grow, compete, and thrive on their own terms in an increasingly digital economy. The quiet revolution in America's trades is just beginning, and its impact may prove far more transformative than the flashier AI applications dominating today's headlines. But the timeline for this transformation may be measured in decades rather than years, and the path forward will require addressing fundamental challenges that go far beyond technology alone.