Maxwell Cohen knew the tariffs were coming. President Donald Trump had openly threatened a trade war on the campaign trail, and Cohen, an entrepreneur, heeded his words. His company, Peelaways, sells disposable and waterproof fitted bed sheets made in China that are popular with at-home and family caregivers. There’s only so much price elasticity for disposable goods, so he prepared to absorb what he estimated would be roughly 15 to 30 percent tariffs, setting aside money to bring in more inventory before prices skyrocketed. It would hurt, but it would be doable. He thought he had the numbers mostly worked out. But when man plans, Trump laughs.

The latest figure for the administration’s tariffs on China sits at 145 percent. Prices are expected to keep climbing for some goods; last week, Trump closed the de minimis loophole for China and Hong Kong, which had exempted them from paying tariffs on shipments of goods worth $800 or less, and wide-ranging tariffs are still set to go into effect for many countries. For any business that can’t swallow an unanticipated and possibly huge price increase on imports, the first step is deciding if it will pass the cost to the consumer. If the answer is yes—as it often is—the next decision is how, or whether, to let the customers know.

Tariff transparency recently made headlines on the domestic front of Trump’s trade war. After Punchbowl News reported that Amazon was considering adding a line showing the cost of tariffs for each product on its site, White House Press Secretary Karoline Leavitt held a public shaming of the company from her briefing-room podium, calling the move “a hostile and political act.” CNN reported that a “pissed” Trump called Jeff Bezos, Amazon’s founder. The company’s representatives soon denied ever approving the idea, adding that it was never a consideration for Amazon’s main site but rather for its spin-off store, Haul.

Although big, name-brand American companies are most likely to incur the administration’s wrath over displaying tariff surcharges, other businesses have tough choices to make on how to go about raising prices. The result is a choose-your-own-adventure exercise in managing public perception. Screenshots of the checkout page of the online clothing company Triangl went viral for the astronomical “duties” surcharge. Temu, a Chinese e-commerce giant, added import charges to certain products on its site. Luxury brands aren’t immune, either: Hermès announced price increases for American buyers to offset the tariffs, and Prada plans to raise prices by an undetermined amount later in the summer. Meanwhile, some business leaders aren’t mincing words. Jolie Skin Co, an American shower-filter brand, told The Information that a “Trump liberation tariff” line will be added to checkout pages. “Technically WE are not raising our prices,” the company’s CEO and founder, Ryan Babenzien, wrote on LinkedIn. “We think transparency is the way to go here and I am giving Trump full credit for his decision.”

Transparency is a high-wire act. Tariffs is such a politically loaded word that some companies hesitate to invoke it, out of fear of alienating their customer base—or inciting the administration’s ire. But pointing a finger at tariffs can also help shift blame. Increasing prices without any clear explanation risks appearing opportunistic, Mike Michalowicz, a small-business expert, told me. All it takes is for some businesses to get caught profiteering before “the customer becomes suspect of not just them but of everybody.”

The gaming industry is a prime example. Nintendo has a large manufacturing presence in China, and last month, it announced that the Switch 2 console would launch at the original price, but some of the accessories will cost more than previously expected. The company’s representatives attributed the update to “changes in market conditions.” If that phrase sounds familiar, it’s almost word for word the explanation Microsoft offered after announcing Xbox price hikes last week, which will run as high as $100 more for some models in America. The absence of the T-word is a glaring omission. Such muddy messaging may help insulate companies from the administration’s spite, but it invites backlash from customers who are quick to blame the good old-fashioned motive of corporate greed.

If some companies fear appearing opportunistic, others are trying to cash in while they still can. Marketing 101 teaches you to distinguish your company from your competitors, and Business 101 says to move inventory before the economy goes kaput. What better way to do both than to slash prices when everybody else is raising them? “Pre-tariff” sales are cropping up at furniture companies, fashion retailers, and carmakers. Their underlying message: Get it before you can’t afford it.

Ford’s latest campaign, “From America. For America,” is trying to strike an optimistic tone. As Audi pauses car imports to the United States, and automakers hem and haw over price changes, Ford has been running an ad since last month touting employee-priced vehicles and their company’s deep roots in American industry. It’s a strategic ploy—already, Ford has reported double-digit sales increases (although an analysis from CarEdge found that some of Ford’s more popular vehicles had better deals in March, before employee pricing went into effect). Other carmakers that manufacture models in America, including Mercedes and BMW, are promising to temporarily eat the cost of tariffs for some vehicles to keep prices from rising. But an expiration date for this generosity could be imminent: Last week, Ford’s CEO went on CNN and couldn’t say if prices would increase in the summertime.

With so much left uncertain in Trump’s trade war, some small businesses are down to the wire. Many of them don’t have the cash to stockpile inventory or the storage space to keep it. The owners of the American vegan-cheese company Rebel Cheese have roughly a month to decide what to do. Much of their cheese relies on fair-trade cashews imported from Vietnam, which faces the threat of 46 percent tariffs, and their inventory is dwindling. The company already went through a round of layoffs a few weeks ago; at this point, adding at least a 10 percent price increase seems inevitable, Fred Zwar, one of the co-founders, told me. They are considering breaking down the numbers for customers when they announce the change, but the sharp fluctuations of Trump’s tariffs make the timing tricky: “We can’t do a price raise today and then say, Hey, they raised it another 90 percent. We need to do another price raise tomorrow,” Zwar said.

All of this feels like déjà vu for Peelaways. Cohen dealt with Trump’s seesawing tariffs during his first term, which also coincided with COVID-19’s economic downturn. He laid off all six of his workers and restructured his business in order to stay afloat, leaving him with two C-suite executives overseas. This time around, he’s running a leaner operation and slowly raising prices $1 a week until he hits a 15 percent increase. His plan is to test different newsletters to measure his customer base’s feedback: One will include the standard fare (caregiver tips, customer reviews), and the other will acknowledge the tariffs’ effects on pricing. But even having gone through this before, Cohen can’t be sure he’ll make it out again. “We’re all just holding our breath,” he said, waiting for “whatever the next tweet brings.”

Related:

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Today’s News

1. The Federal Reserve held interest rates steady. Federal Reserve Chair Jerome Powell said that the tariffs in place could generate stagflation and more unemployment.
2. India launched strikes at Pakistan, in retaliation for a terrorist attack two weeks ago in Kashmir.
3. Cardinals did not elect a new pope on the first day of the conclave in Vatican City.

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Evening Read

The Real Motive Behind the Real ID–Deadline Charade

By Juliette Kayyem

Today’s deadline was largely artificial: According to the fine print of the regulations governing Real ID’s implementation, Homeland Security has until the end of 2027 to phase in the program in full. So the administration took today’s deadline to assure Americans that they could still fly, while it focused on another priority: immigration enforcement, rather than safety provision.

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Read. A book by Pat Buchanan from 2011 shows how the woke right predates the woke left, Jonathan Chait writes.

Examine. Ellen Cushing explores why so many companies are inviting people to opt out of Mother’s Day emails.

Play our daily crossword.

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