The cost of doing business is going up for ReShonda Young, the co-owner of TnK Health & Nutrition in Waterloo, and she feels as if her hand is forced in passing the extra costs on to her customers.
Young said she has seen prices go up among most of her vendors for items such as nutritional supplements and nuts, seeds and other healthy snack products.
“As a business owner, you can’t absorb all those increases or you’ll be out of business,” Young said.
The U.S. Labor Department’s consumer price index was up 3.8% in April compared to the same time last year, a jump that the Associated Press reported was the largest increase in the indicator in three years. Prices went up 0.6% in April from March.
Young told the Iowa Independent that her health and nutrition store sells high-quality products, so her options for making things easier for customers are limited.
“There are some customers that, simply, they can’t afford the same things,” she said. “They have to make some tough choices.”
Since President Donald Trump took office last year, Iowa businesses have struggled with his administration’s tariffs, which the U.S. Supreme Court struck down in February, and with rising gas prices connected to the war on Iran. Iowa’s average gas price is $4.30 for a gallon, up from $3.66 a month ago and $2.90 a year ago, according to AAA.
However, it’s not just the tariffs and the war that are frustrating small businesses, said Mike Draper, founder and owner of the clothing store chain Raygun, headquartered in Des Moines.
“I think the general frustration among small businesses is that as industries have consolidated and become kind of more opaque, you’ve been dealing with price increases since even before the pandemic, but you don’t really know why,” Draper told the Iowa Independent. “And so I think if I were going to boil it down, you know, a lot of people say, Well, and we all know price increases are going up because of the Iran war, and maybe some of them are. But then there’s other price increases where you’re like, Yeah, I don’t know, is this industry just heavily consolidated, and now they know that they can just increase prices to increase profits and blame it on, you know, COVID, or the Iran war, or tariffs?”
Draper said businesses have to handle the same rising costs that individual people deal with. That includes rising prices for gas, utilities and healthcare.
On gas in particular, Draper said about 35% of his sales are online. Higher fuel costs mean higher shipping costs.
Draper, an Iowa native, said he opened his first store more than 20 years ago. He said corporations that control markets are able to raise prices, leaving small businesses with no options.
“We joke about it at Raygun. We’re like, Is everything a scam now? You look at Adobe Photoshop: In 2005 I went in to CompUSA and bought a CD, Adobe Photoshop CS, and I don’t know what I paid for it, maybe $100. Twenty years later, everything I do in Photoshop I could do with Adobe Photoshop CS, but now I can’t buy Photoshop. I have to rent it from Adobe. So you pay what you used to buy Photoshop for, you now rent Photoshop for every month, and for what? You only do that because Adobe has enough control over the market that, where am I going to go?”
Draper said large companies hope that consumers will just grin and bear the higher prices. He said the consolidation of wealth on an individual level leads to fewer people having disposable income.
“So, your supplies from your vendors are more expensive and you have fewer people to sell your more expensive products to,” Draper said. “That, no matter what happens in Iran or with tariffs, those two things are the vise that is going to squeeze every small business in America.”
Young said she wants political leaders to think about the everyday people who are just trying to live.
“When you’re making policies, just remember that there are real people behind the decisions that are being made,” she said.