Truths to Tariffs
Tariffs are far from a simple cost add-on phenomenon that end-users have to deal with. They insinuate themselves into business operations and supply chain calculations far removed from any obvious final product. But that isn’t the only strain today’s business leaders contend with due to tariffs — the actual status of a given tariff may change without warning.
Small businesses, however, are experiencing the impact of tariffs in dramatically different ways. They are not a monolith. A solar installer faces a very different set of constraints than a furniture retailer, toy store or neighborhood restaurant. Some local businesses have attempted to adjust their product mix or renegotiate terms with suppliers, sharing costs where possible. Others have taken far riskier paths, borrowing heavily to purchase inventory ahead of anticipated tariff increases. While this strategy may have temporarily shielded them from higher prices, it has introduced new burdens: interest payments, storage costs and tied-up capital.
Many are effectively gambling on a strong holiday season or hoping tariff policies will be reversed within a year. In every case, margins shrink. Business owners are left with the same stark choice: absorb diminished returns or pass higher costs along to customers.
The notion that tariffs will quickly revive American manufacturing is appealing but largely unrealistic. Rebuilding entire industries requires years — if not decades — of investment in infrastructure, skilled labor and supply networks that no longer exist at scale. Labor costs alone present a formidable barrier. While policymakers experiment with blunt economic tools, Arizona’s small businesses are bearing the immediate consequences, struggling to stay afloat amid uncertainty that they did not create and cannot control.
For this month’s cover story, In Business Magazine reached out to businesses in diverse industries — from microchips to construction to healthcare and entertainment — to learn not just how they are experiencing the impact of tariffs in the short term but to begin an understanding of long-term outcomes to our business community.
One of the promises of technology is benefitting business planning, but, as Alex Radulovic points out in his feature article “The Hidden Costs of Choosing the Wrong Software for Your Business,” there is no one-size-fits-all solution; in fact, he notes using workflow tools can be counterproductive if not done correctly. Fit requires a tailored approach, and Radulovic discusses factors that business leaders should consider.
Technology isn’t the only area where business is — or can be — investing in the future. Exploring economic as well as social concerns, Jeri Royce and Dr. Karen D. Johnson make “The Business Case for Investing in Under-Resourced Youth” in this month’s Roundtable feature.
Taking a practical look at social involvement, Mohana Holloway discusses how social media turns purpose into power in this month’s Nonprofit feature, “Social Impact as a Business Strategy.”
In-depth articles explore “How CX (Customer Experience) Can Combat Customer Churn,” as Matt Ream advises businesses to note that CX doesn’t stop at customer service, and “The Hidden Distractions of Leadership,” as Bruce Weber discusses how leaders lose focus and what it costs to their business.
Other features this month include whys and hows of “Business Exit Planning” from an experienced banker and considerations of protecting business and personal finances in “Why Legal Structures Matter” from a local attorney. Content also covers business “prenups” (check it out in the Briefs section), short-term rentals as a business opportunity in the real estate sector, trends in the healthcare sector and advances in our burgeoning semiconductor industry, and much more.
In Business Magazine is focused on helping strengthen our local business community, and it is my pleasure to help bring you this January 2026 edition as we celebrate the promise of the new year.
Sincerely,
Kimber Lanning
Founder and CEO
Local First Arizona
Kimber Lanning is an entrepreneur and economic specialist who works to cultivate vibrant, sustainable communities and inspire a higher quality of life throughout Arizona. Lanning is actively involved in strengthening economic self-reliance by leveraging entrepreneurship and small business development. She is the founder and CEO of Local First Arizona, an economic and community development nonprofit focused on creating, capitalizing, and supporting Arizona’s business community.
