International grocery stores in the U.S. face import tariffs and supply chain challenges: Small retailers are feeling overwhelmed

In April 2025, international grocery stores in the United States faced challenges due to the import tariff policy implemented by the Trump administration, imposing a 10% tariff on all imported goods and up to 145% on Chinese products. These small, family-run stores that rely on imports are under pressure from rising costs, unstable supply, and losing customers. Business owners from Maryland to Iowa generally feel anxious and are trying to adjust their business strategies to meet these challenges.

The Family Grocery Store's Dependence on Imports and Cost Pressures

Lenny Ung, who has operated Hung Phat Groceries in Wheaton, Maryland for over 30 years, is facing the toughest time in his career. This grocery store, specializing in Southeast Asian ingredients, sources over 90% of its products from overseas, including mushrooms from China, Kewpie mayo from Japan, and fish sauce from Vietnam. Ung states that new tariff policies might force him to remove these customer favorites from the shelves.

"We don't want to change, but we are powerless," Ung told USA Today. He noted that since January, store revenue has dropped by 20%, mainly due to reduced customer spending and federal government layoffs affecting his primary clientele. Tariffs are just adding insult to injury.

In Pittsburgh, Pennsylvania, the family-run Lotus Food is facing a similar predicament. About half of the store's products come from China, and manager Joy Lu says that basic items like soy sauce and rice noodles may become too costly to sell. "In the worst-case scenario, we will stop importing from China and look for alternatives from Thailand, Indonesia, Taiwan, Japan, and Korea," she said.

Supply Chain Uncertainty and Procurement Risks

In addition to rising prices, supply chain uncertainty is making it difficult for businesses to make procurement decisions. Salah, owner of Hilal Groceries in Des Moines, Iowa, says he cannot get clear pricing and supply information from suppliers. "You call the big suppliers and ask, 'Should I stock up?' and they can only say, 'We don't know.'"

This uncertainty is particularly challenging for stores selling perishable goods. Many businesses are considering whether to stock up in advance to avoid future higher prices, but such a strategy carries high risks for foods with short shelf lives.

At Halalco Halal Meat Groceries in Falls Church, Virginia, manager Awais Mohammed is negotiating with suppliers, hoping to delay price increases. "We ask them if they really need to raise prices by 10%, not to do it immediately," he said. "We want to give customers some time to adjust their budgets."

Limited Food Choices for Diverse Ethnic Communities

These international grocery stores are not just commercial venues but also cultural and culinary pillars for immigrant communities. Many customers rely on these stores to purchase ingredients from their homeland that cannot be found in mainstream supermarkets. Ung states that his customers are mostly immigrant families with fixed incomes, who are extremely sensitive to price changes. "Price hikes are a real pain for me," he said. "I talk to customers every day and know their situations."

At Tanganyika Grocery Store in Des Moines, specializing in African foods, Philavanh and Roza Katembo have already had to raise prices to stay in business. The price of a 22-pound bag of cornmeal has risen from $25 to $40, and the price of cassava leaves has doubled from $5 to $10.

Meanwhile, at La Tienda Mexicana in the same city, owner Alonso Magallanes has observed a noticeable decrease in customer numbers. He believes that, in addition to economic pressures, the Trump administration's immigration policies have also made some customers uneasy.

Tariff Policies and Logistics Bottlenecks Intensify Pressure

According to a DHL announcement, as U.S. Customs lowers the threshold for simplified import procedures from $2,500 to $800, all packages exceeding this amount will require formal customs processing, leading to logistics delays and increased costs. DHL has suspended all international packages over $800 from direct delivery to U.S. consumers, further impacting retailers reliant on international supplies.

Additionally, the Trump administration plans to close the "de minimis" tax exemption loophole on May 2, which will require low-cost goods from China and Hong Kong to pay tariffs and undergo inspections. This change will be particularly significant for retailers and e-commerce platforms like Shein and Temu that rely on small imports.

Food Inflation from Pandemic and Avian Flu Overlaps

Even before the tariffs were implemented, U.S. food prices had risen due to avian flu and supply chain issues. According to data from the U.S. Bureau of Labor Statistics, the prices of meat, poultry, fish, and eggs increased by 1.3% in March 2025. The avian flu outbreak has led to the culling of more than 170 million birds since 2022, further driving up egg and meat costs.

These factors, combined with the new tariff policies, are putting multiple pressures on international grocery stores. Many business owners say they are trying to absorb some of the costs, but if the situation continues to deteriorate, they will have no choice but to pass the price increases on to consumers.

References

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