BILLINGS — A small Billings business that manufactures products overseas is anticipating higher costs now that President Donald Trump's 10% tariff against China now in effect.
SewTites was born in 2018 after Jessica Drain's sister was working on a project but didn't want to put holes in it with a sewing pin, so she used magnets.
The sisters created the magnetic sewing pins to hold garments in place, and their business quickly took off.
Inside the Billings warehouse, they now have multiple products under the SewTites business.
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“Everything we manufacture is magnetic. Everything is quilting and sewing tools,” Jessica Drain said on Tuesday. “We sell off our website domestically and internationally. I mean, I think we just recently had an order that we shipped to like Thailand or something, which is pretty neat.”
The company has outgrown its space and is working on building a new warehouse to hold products for distribution. The boxes filling the warehouse all say "Made in China" because manufacturing the products in China is the only way they can stay in business.
“We have tried since we started to manufacture in the US. And our products, it's kind of crazy, but they're very simple, but there are really only a few places in the world that can manufacture them,” Drain said. "We personally don't have the money to invest in millions and millions of dollars of manufacturing equipment."
With the increase in tariffs, SewTites will have to pay more for the products.
"With the amount of product that we import, it would probably cost us $50,000 to $100,000 additional per year, depending on the year and how we're growing for that. So, that's not just something that a small business can necessarily just absorb," Drain said. "If we were to manufacture in the U.S., then it would be again, like three times as much as that. And I don't know if we would be able to even have a business at that point."
Drain said they are going to continue to look at manufacturing in different countries.
"We don't love their (Chinese) government, obviously, but the people there that we work with are amazing and they actually own their own businesses too. And they're making money, we're helping them make good living, doing good jobs," Drain said. "Sometimes people just look at 'made in China' and they get kind of offended or upset by it. What they don't always understand is that by buying those products, they could also be helping people live and work in the United States and in our example in a rural area in Montana."
Drain said the business won't be immediately increasing prices by 10% to offset the tariff, but she anticipates a future increase. The business has an inventory of products that arrived before the tariff was imposed.
"It's a 10% increase to us, but it's not going to be a 10% increase to the consumer. However, quite frankly, prices are just going to go up for consumers," Drain said. "So, probably will be increasing prices in late spring and then for the cutting system products that we have in stock those probably won't increase for another year."
SewTites isn't the only business that could see the hit. China is a dominant producer of tech products.
Billings Tech Guys owner Dylan Solberg said he doesn't buy directly from China, but the business could still see an impact.
"It's still pretty fresh. You know, a lot of parts unfortunately come from China. So that's, you know, it's going to trickle down eventually to us," Solberg said on Wednesday. "We have different distributors we go through, which are all US-based. But they'll get their parts from who knows where. Generally, they stick to the United States."
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