Tariffs: Small Business Impact with Beth Benike

In this episode of The Chad & Cheese Podcast, hosts Joel Cheesman and Chad Sowash welcome Beth Benike, CEO of Busy Baby, a baby product company featured on Shark Tank and NPR’s How I Built This. Benike, a former Army veteran and mother, shares the story of Busy Baby, which started with a silicone placemat that suctions to surfaces and tethers toys to keep them off the ground.

Now offering eight interchangeable products, the company faces a crisis due to new U.S. tariffs on Chinese imports, with $158,000 of inventory stuck in China and tariffs soaring to $230,000—far exceeding the anticipated $30,000 for a 20-30% rate. Manufacturing in the U.S. isn’t viable due to the lack of raw silicone material, high minimum order requirements, and costly equipment (e.g., $4.5 million for one product line).

Benike highlights the ripple effect on small businesses, like trucking firms and port workers, as imports stall and shelves risk going empty, potentially disrupting holiday sales since 80% of U.S. toys come from China. She plans to pivot to selling in Europe, Canada, and Australia, despite unfamiliar markets, as tariffs make U.S. sales unsustainable.

The discussion also touches on unfair tariff exemptions for large companies like Lenovo, leaving small businesses like Busy Baby struggling, and the broader economic threat to jobs and consumer spending. Benike remains determined to protect her team and find solutions, urging listeners to visit busybaby.com.

Chapters

00:00 - Introduction to Busy Baby and Beth Benike

01:28 - The Journey of a Veteran Entrepreneur

03:24 - Manufacturing Decisions: The China Dilemma

06:02 - Tariffs and Their Impact on Small Businesses

10:01 - The Future of Retail: Empty Shelves Ahead

12:07 - The Ripple Effect of Manufacturing Challenges

17:38 - Exploring Alternatives: Europe and Beyond

21:17 - Intellectual Property and Relationships in China

25:05 - The Disparity Between Small and Large Businesses

28:05 - The Human Element: Team and Community Impact

32:11 - Conclusion: The Bigger Picture for Small Businesses