By Ryan Maloney
The effect of the United States Trade
Representative (USTR) announced tariffs on small U.S. businesses is dramatic
and have the potential to become devastating. Not only would it effect
suppliers and wholesalers of wine and single malt scotch, but it would also
have an influence at the retail level. Jobs and stores will be lost right on
Main Street USA where the impact will be felt most.
Wine in the first round of tariffs was a
25-percent increase. Some suppliers were able to absorb it, but 100-percent
will be much tougher and for smaller retailers, impossible.
In the case of European Whisk(e)y, there are
different hurdles. Single malt scotch sent to the U.S. has to be
specially bottled in a 750 ml. While the rest of the world (except South
Africa) uses 700 ml. So if there are more impediments like a 25-100-percent
tariff, anything but the basic whisk(e)y will be shipped to U.S. The slack will
be taken up elsewhere especially China where demand is high.
Many smaller retailers of wine and whisky
have invested deeply in specialty items that the big chains and big box stores
do not carry, these items are exactly the products that have been targeted by
the tariffs! You are essentially taking away the one advantage these stores
have to stay relevant and in business. It is unfathomable that they are being
sacrificed to prove a point about a dispute between two international mega
corporations in a field not even relevant to the same industry!
Further these new round of tariffs are now
being used a bludgeoning tool against the European Union to help internet
corporations that are not even paying their fair share domestically! Boeing,
Facebook, Amazon, and Google are well equipped to weather international trade
disputes within their own industries.
Unfortunately, the Mom and Pop stores are not
designed survive when their livelihood is being used as a chess-piece in a
multi country trade dispute. Especially a trade dispute in which they have no
say and no recourse. It is important to note that there are no subsidies
to the small businesses that will be effected by these tariffs, as there were
with agricultural tariffs. There are better ways within each of these disputed
industries to handle this without putting undue stress on an industry that is
dominated by small businesses.
Ryan Maloney is President, Massachusetts
Package Store Association.
