Jim Sanfilippo, a small-business owner from Pasadena, is facing a tough situation. For the past twenty years, he has been creating specialized LED lights for a variety of high-profile clients, including stadiums, the U.S. House of Representatives, and even the James Bond film "Quantum of Solace." However, recent changes in U.S. trade policies are putting his business at risk.
President Trump’s administration has introduced some of the highest tariffs in nearly a century, including a staggering 145% tariff on goods imported from China. This policy impacts Sanfilippo’s company, Nila, because most of the parts for his lights, like circuit boards and light-emitting diodes, come from Asia. Although he assembles the lights in Pasadena, the increased costs from these tariffs are making it hard for him to plan for the future.
Sanfilippo expressed his frustration, saying, “It’s chaos created by uncertainty.” Customers are hesitant to place orders due to the unpredictable tariffs, which could change at any moment. U.S. Representative Judy Chu, who visited Nila recently, highlighted how these tariffs could lead to significant economic issues for small businesses across the country.
The tariffs are not just affecting Sanfilippo. Many businesses in California are on edge, especially farmers and workers in Hollywood, as countries like Canada and China retaliate with their own tariffs on American goods. Trump argues that these tariffs are necessary to reduce the trade deficit and protect American manufacturing, but many small business owners like Sanfilippo are feeling the pressure.
Sanfilippo has had to rush orders from suppliers to avoid the impact of the new tariffs. He even paid an extra $17,000 to expedite a shipment just before the presidential inauguration. Now, he faces the reality that any new orders will include fluctuating tariff costs, making it difficult to maintain stable pricing for his products.
Despite the challenges, Sanfilippo has managed to secure enough supplies to fulfill orders for his most popular lights for the next two years. However, he worries about the future of larger projects, including ongoing contracts with the U.S. Senate and various media facilities.
Nila initially relied on American manufacturers for its parts but shifted to overseas suppliers as costs rose in the U.S. Returning to domestic production would drastically increase prices, making his lights unaffordable. A compact light that currently sells for about $1,000 could soar to $10,000 if all parts were made in the U.S.
In response to the tariffs, Sanfilippo is considering new strategies. One of his suppliers in China is exploring the possibility of opening a facility in Mexico, where labor costs are lower and shipping times are faster. Additionally, Sanfilippo plans to expand his international client base and offer consulting services to American companies looking to reduce energy use.
As the situation develops, Sanfilippo and many other small business owners are left to adapt to a rapidly changing economic landscape, uncertain of what the future holds.