MIDDLETOWN -- Dottie Smith, who has owned a gift shop in Middletown's Main Street Market for the past decade, has made the difficult decision not to raise prices despite fluctuating tariffs on products she sources from overseas and Canada.
Smith has been in the business for 45 years, formerly owned shops in Essex, Durham and Block Island, R.I., and now, A Pocketful of Posies on Main Street. She relocated to Middletown, Smith said, where shoppers are always asking for more retail, so she fit right in.
The shop has soaps, "funky" hand-dyed and other apparel, jewelry, candles, plants, decor, teas, honey, chocolates and other items.
She said that everyone who has visited her store in the past two weeks has asked her if she was impacted by the tariffs.
Some weren't aware that small businesses that buy items from Canada and countries overseas are being affected, Smith said.
"They just needed to know what was going on," she said.
She finally decided to explain the situation to customers on Facebook.
"I wanted to let them know that I was going to do everything I can to keep prices the way they are for now -- the next three or four months -- then reevaluate in January," Smith said.
The holiday season is Smith's busiest time of the year, when the store is filled with Christmas and other holiday-themed gifts and decor. Most of that merchandise is imported from China.
Smith has been relying on the rainy day fund she established years ago in case her business was affected by a snowstorm, for example. In fact, she had forgotten all about it.
She dipped into her business savings during the pandemic to pay employees and other expenses, and has had to do it again.
"I had to think long and hard about it," she said. "I said, 'I'm going to use this because all these people that have been following me for years are great.' They got me through COVID and I think I owe them something."
Raising prices is the last thing Smith said she is willing to do.
Duties fluctuate depending on the time of year, where the goods come from, and even week to week, Smith explained. In February, vendors told her about the changes coming, so she put what orders she could in then.
This month, she added, tariffs have varied from 16% to 30%.
"Nobody knows from day to day (what) it's going to be," she said.
Two Christmas vendors decided to cancel her orders because of increased costs.
"They don't know how much they have to pay when they get to port," Smith said. "They decided they're not going to deal with it."
Even China has begun to outsource some work to Thailand and other countries where it's cheaper so vendors can keep tariffs down, she said.
When Smith started out in the 1980s, she had no trouble finding local, handcrafted goods at an affordable price. Now she mostly orders from an online marketplace where she searches for items by classification, which makes it more of an efficient process.
"It's literally my savior," said Smith, who spends hours at night sourcing things from around the country. "It's not a 9-5 job."
Holiday items formerly priced at $20, for example, are sold for $25 wholesale; too high for her customers to pay and give her a profit. Plus, she needs to order an "overabundance" so she has enough inventory.
Other purveyors have decided to share a percentage of increased costs, and absorb the rest, she said.
Smith said she sympathizes with new and young business owners confronting the same thing and perhaps being forced to shut down; as many are doing nowadays.
In merchandising, business owners order goods a season ahead of time. For spring orders, Smith said, she's looking for items subject to little or no tariffs.
Despite her troubles, Smith's philosophy remains "stay positive and thankful for the people who come in."
One thing Smith is looking forward is the annual girls night out Oct. 19. Light bites and beverages will be served and participants can receive a 20% discount.