'Half my business will be gone' – Firms in Canada and US fear trade war

Cindy Baldassi relies on American buyers to keep her stone-and-glass jewellery firm going.

Key points

• Some 75% of sales of pieces including amethyst, sea glass and agates from her business, CindyLouWho2, based in Calgary, Alberta, come from Americans.
• Canadian Prime Minister Mark Carney has pledged levies starting on 8 September on US steel, dairy, appliances and electronics.
• What has further irked Canadians has been Trump musing on Canada becoming a 51st US state.
• "As soon as there were tariffs in the air, people put purchases on hold, " Michael Saifer, general manager of Lind Furniture, informed the BBC.
• Canada would be particularly exposed if the import taxes multiply on both sides as 70% of its exports are to the US.

But after trade discussions between the US and Canada collapsed over the weekend and leaders of both countries pledged to slap 50% tariffs on each other's products, business owners on both sides of the border are bracing for the fallout.

With a majority of the items she sells falling under US President Donald Trump's newly imposed tariffs, Baldassi notes she will need to add 50% to the rate of most of her products to stay afloat.

"It's quite likely that it will wipe out most of my US sales, " Baldassi informed the BBC. "I expect that at least half of my business will be gone."

Canadian Prime Minister Mark Carney has pledged levies starting on 8 September on US steel, dairy, appliances and electronics. Trump tariffs went into effect on Saturday, hitting Canadian wine, dairy, cement, clothing and hockey equipment. 'We may obtain killed'.

Since the country has grown somewhat applied to the on-again-off-again trade war, in Canada, it is not clear how much more severe the impacts will be.

Lind Furniture has been in business for almost 60 years in the Canadian province of Ontario, selling leather furniture to major store clients like Sears and Costco over the years.

Sales dropped when Trump took office in 2025. "As soon as there were tariffs in the air, people put purchases on hold, " Michael Saifer, general manager of Lind Furniture, informed the BBC.

Trump notes Canada wants 'benefits' of being US state after trade negotiations collapse. Now, his concern centres around Canadians' chances for victory.

"Everyone wants to sell to the Americans – they can buy from whoever they want, " he remarked. "I don't know that we're going to win a war with them; we may get killed."

Meanwhile, the US tariffs that took effect after discussions broke off on Friday apply to concerning $20bn (£15bn; C$28bn) worth of Canadian exports to the US – regarding 5% of what Canada ships to the US annually. The levies add to US tariffs already in place on Canadian steel, aluminium, automobiles and lumber.

Navigating what comes next as both sides are dug in is proving a delicate balance for some business owners.

Like plenty of retailers, Matteo Sgaramella, founder of Toronto-based menswear brand Outclass, informed the BBC that his firm collects orders from clothing designers months before they are due to arrive in stores.

Products that US stores ordered in January will arrive in September but now with a new tariff.

"If I contact them now and tell them, hey, you know, you may get an extra 50% bill from UPS on top of what you need to pay me for this shipment, they're all going to say, 'no way, don't ship it, '" Sgaramella remarked.

He still has to figure out where that extra cost will go.

"There's going to be a lot of people that go out of business because of this, " Sgaramella remarked, but observed that only 20% of his wholesale sales and 20% of his e-commerce come from the US.

"Big business can, you know, always find a way. But small businesses are going to get smashed by this." 'It's going to obtain worse before it gets better'.

For context, the impacts are not only being felt north of the US-Canada border. Carney promised his tariffs hitting US products in September will match Trump's "dollar-for-dollar". Details of the countermeasures will be published over the next few days, he stated.

For Mike Roach and Kim Osgood, owners of Paloma Clothing, a clothing store in Portland, Oregon, that means preparing for one of their best-selling items to potentially growth sizably in rate.

Osgood creates designs that she has a Montreal-based firm transfer onto pillows the couple sells in their store.

Those pillows are their best-selling gift item, retailing at $59. With the newly imposed tariffs, a normal markup would bring the cost of that pillow to somewhere between $86 and $90, Osgood informed the BBC.

"Gift items are really price-point sensitive; people have in their mind what they're going to pay for a gift, and they're not going to pay more than that, " Roach remarked.

In practice, the couple, whose shop has been operating for 51 years, say they will probable hold the original rate and hope the "tariff problem, " as Roach calls it, gets worked out.

"It would be one thing if we had three months' notice; that would be something you could plan around, do some work with the vendors, but when it happens literally overnight you're really stuck, " he remarked.

While the tariffs could mean changes for the Paloma Clothing firm, other American businesses are facing the same battle they have faced since Trump returned to office and began imposing his levies.

Bill Easton, owner of Terre Rouge Wines in Plymouth, California, has been unable to ship his wine north to Canada for the past year and a half due to a boycott of US alcohol.

He is at present paying $2, 400 a month to store that wine in a warehouse in the hope that he will one day be able to ship it to the Canadian markets he sells to.

"The wine has just gotten better in the warehouse, but I can't expect my customer in Canada to pay that extra cost that I've assumed over the last year and a half as part of the price, if I was able to sell it tomorrow, " Easton informed the BBC.

And then there are the American businesses impacted by proximity to the Canadian border.

For context, the number of Canadian customers travelling throughout the border to shop at Heather Seevers' craft shop, Northwest Yarns and Mercantile in Bellingham, Washington, has gone down some 20% since the tariff war began over a year ago. What has further irked Canadians has been Trump musing on Canada becoming a 51st US state.

For context, the shop sits 25 minutes from the US-Canada border and since the "war" ensued Seevers said her business received emails from Canadian customers saying they could not patronise her business "due to anti-Canadian rhetoric". "We completely understood that, " she remarked.

But the combined impact of fewer customers and higher rates has left the shop asking for assist from the community lately via a fundraising initiative to stay afloat.

When the new tariffs struck, Seevers saw another hurdle appear, and then, over the weekend.

"It's going to get worse before it gets better, " she remarked. "It's going to take years and years and years to get a relationship back with Canada, and I think these new tariffs are digging us deeper into a hole." Extra reporting from Nadine Yousif.

For now, ' Half my business will be gone' – Firms in Canada and US remains the part of the story worth watching, and further updates are likely as more details are confirmed.