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The basics:

• Trump administration’s 10% tariffs ‘punishing’ for some NJ businesses
• But companies that make or source products domestically see it as an opportunity
• Local sourcing, longstanding relationships with suppliers benefits chains like Stew Leonard’s

With the Trump administration’s baseline 10% tariff on imports from most countries scheduled to take effect July 9, retailers and consumer product companies across the U.S. are determining strategies for how best to navigate the changes. Businesses that rely heavily on imported goods to stock their shelves or have their products manufactured overseas believe the trade policy will have a devastating impact.

When President Donald Trump unveiled the series of tariffs in April, he argued that it would boost American manufacturing and protect jobs. However, the announcement threw the world economy into turmoil, creating uncertainty for companies, as well as concerns about higher costs, supply chain disruptions and tighter margins.

For example, the Monmouth County mother-son duo behind Rinseroo, a slip-on hose attachment that recently scored big on ABC’s “Shark Tank,” said the import taxes threaten to crush their entrepreneurial dreams.

When they launched Rinseroo on Amazon in 2019, it became an instant success and generated $1 million in sales during its first year. During their appearance on the reality competition series in March, founder Lisa Lane said they’re on track to sell $5 million this year.

After securing $343,000 backing from investor Lori Greiner, Lane said they planned to use the funding to scale online sales and fight off competition from knockoff brands.

“What was once a profitable, fast-growing business has turned into a fight for survival,” said Lane. “I did everything right — bootstrapped from scratch, created jobs, paid taxes, built a brand, got national exposure. And now, two months after ‘Shark Tank,’ I’m staring down costs that could take me out of business.”

As of now, manufacturing the Millstone Township-headquartered company’s patented products domestically instead of in China isn’t realistic, according to Lane.

“I’ve gotten quotes. It’s not just more expensive — it’s wildly more expensive. The materials, the tooling, the infrastructure — it’s just not there for a business of my size,” she said. “China produces a high-quality product at a price that lets me offer it affordably to families. If I try to move production or absorb these new tariffs, the cost would force me to charge a price the market simply won’t bear.”

Lane said, “What used to cost $17,000 to land at the port is now costing close to $150,000. And that’s just to get the product off the boat. That’s not marketing, warehousing, shipping, salaries — just raw access to inventory.”

‘No viable alternative’

Unlike luxury goods, Rinseroo’s lineup of nearly a dozen cleaning products has a price ceiling, Lane said. Its signature slip-on hose attachment sells for $27.95, while other items, like a vacuum attachment for dryer vent cleaning goes for $19.99 and a scented drain hair catcher retails for $11.99.

“You reach a point of diminishing returns. A product like mine solves a problem, but it’s only worth so much to the average consumer. I don’t want to pass these costs along to them — and even if I did, the market wouldn’t tolerate it,” she said.

Lane emphasized she’s not opposed to tariffs in general, saying, “I understand a small tariff, like a sales tax. But when the fee at the port is 1.5 times the cost of goods, with no exchange of labor, materials or value — it’s punishing. Especially when no viable alternative for U.S. manufacturing exists.”

She went on to say, “I’m not a mega-corporation gaming the system. I’m a mom from New Jersey who came up with a clever product, built a following, created jobs and played by the rules. And now I’m being priced out of my own business … I just want to keep doing what I’ve always done: solve problems, make great products and grow responsibly. But right now, I’m being pushed toward extinction — not by competition, but by policy.”

I’m not a mega-corporation gaming the system. I’m a mom from New Jersey who came up with a clever product, built a following, created jobs and played by the rules. And now I’m being priced out of my own business.
– Lisa Lane, Rinseroo founder

The U.S. and China recently declared a temporary truce over tariffs, each agreeing to roll them back for a 90-day period starting May 14. Under the agreement, the U.S. will lower those tariffs from 145% to 30%, while China’s retaliatory tariffs on U.S. goods will drop to 10% from 125%.

Analysts expect a surge in U.S. imports from China over the next three months as business and retailers stock up on Chinese goods. The greater demand for logistical services is expected to result in higher costs for container shipping and freight, which will only add to the existing inflationary pressures in the U.S.

Staying ahead of the wave

However, companies that make or source products domestically see it as an opportunity to build their businesses by helping retailers, suppliers and vendors who are bracing for tariffs.

A subsidiary of Cranford-based National Tree C., Scentsicles is a leading purveyor of seasonal and holiday scents. Known for transforming artificial Christmas trees with discreet scented paper stick ornaments that deliver real, fresh-cut scent, the brand is steadily branching out into other seasons, like springtime, autumn and Halloween.

Billing itself as a “tariff-free, always-in-stock solution” for stores that are concerned about inventory shortages ahead of the holidays, Scentsicles says its North American-based supply chain is strong enough to withstand tariffs and shipping delays.

The company got its start 20 years ago in the Atlanta area as a niche floral product. Since entering mass market retail in 2009, Scentsicles has pioneered the seasonal scented ornament category with partnerships at chains across multiple channels, including mass, DIY, craft, club, drug, gift & garden, grocery, specialty and value/dollar stores. Just a few of the retailers where you’ll find Scentsicles include Walmart, Michaels, Lowe’s, Kohl’s, Target and CVS Pharmacy.

After the National Tree Co. acquired Scentsicles in October 2022, it now has the backing of the nation’s largest provider of artificial Christmas trees and seasonal décor.

‘A way into Christmas’

The company’s core item – a unique Forest Stewardship Council-certified, patented paper and the fragrance that goes in it – is made in the U.S. And it’s assembled into displays in Mexicali, Mexico, which allows it “to offer the product cost effectively for consumers,” said Tamara Kullback, senior vice president and general manager at Scentsicles.

It’s also covered under the United States-Mexico-Canada Agreement (USMCA), making Scentsicles exempt from tariffs.

But Trump has recently called for the renegotiation – or possible termination – of the five-year-old pact. USMCA replaced the North American Free Trade Agreement and allows certain goods and services to travel between the U.S., Mexico and Canada without duties — provided they meet specific trade compliance rules.

After noting that Scentsicles’ production base has always been in the U.S., Kullback said, “It makes us more nimble and it allows us to react faster. A lot of Christmas is made overseas – specifically in China – so the retailers are working 12-to-18 months out. The orders have to be placed very early, and containers have to get on the water very early.

“We have shorter lead times. We can also react with replenishment. We’ll have retailers who sell out and call us and we can get more product to them – in-season – because our supply chain is so centered in North America,” she said.

Should the import taxes go into effect this summer, Kullback said, “We hope that we can be there to help the retailers to really partner with them. If they can’t get product on their shelf at an affordable price, we can do that and we can offer a way into Christmas.

“We’re not the biggest, most important thing that goes on their shelf. But we’re here to help. We can very quickly fill a need with non-tariff products at an accessible price point that we already know consumers love. And, we already have enough history to know exactly what products are proven and can move. And we have the benefit of this supply chain,” she said.

Kullback continued, “We have a lot of 10 year-plus customers because we really very consistently deliver a high sell through. We deliver incrementality because we’re that one more thing that you put in the cart. And we do it very productively because it’s a small footprint that we take up in the store and we have such a variety of displays. We can work with the retailers to take up the least amount of space possible and ensure that they get that incremental sale,” she said.

“We are not just a one-hit wonder anymore. We now have something for every season of the year. So, it is actually worthwhile to bring us on as a new vendor and we can drive that little bit of profitable incrementality year-round. And so, we’re really hoping we can expand our customer base,” Kullback said.

Besides scented sticks, Scentsicles sells soy blend candles, scent misters and “Scentfetti,” recyclable paper ribbons infused with fragrance that can be displayed in decorative bowls or put into sachets.

“When consumers love a fragrance, they want it in a lot of different formats. So, we’ve started launching those,” Kullback said. “We have quite a robust innovation pipeline. We want to continue to offer things that are unique … and that deliver on what our consumers are looking for, which is simplicity, safety, sustainability and, of course, they want beautiful scents that really works.”

“I’ve been on this brand since the beginning and I was the only one in the acquisition that came over from the old company and it’s been so great to work with National Tree. They’ve been really supportive … This is a brand that consumers have always loved, but it was small and it wasn’t getting a lot of love or investment to grow. And now with us being part of National Tree, it’s getting the attention it’s always deserved. It’s a really exciting time,” Kullback said.

She said Scentsicles doesn’t seek to go up against other more established home fragrance makers, like Air Wick, Glade or Febreze.

“We really created this scented-ornaments category and we’ve been lucky enough to really dominate it,” she said, explaining, “What we are trying to do is find the white space opportunity that is a simple, safe way to have fragrance wherever you want it that’s delivering an authentic smell … that puts the onus on us to do it differently and do it better than them – particularly as a small kind of challenger brand.

“We’re up nearly 200% year on year with our online sales, and it’s very much driven by these new fragrances, and we’re pleased to see the reviews that we’re getting from consumers on them. And we grew 19% last year, and we have an even larger growth goal for this coming year,” she said. “We’re excited and feel very fortunate to be in this kind of growth mode when I know a lot of other companies right now, they’re scrambling.”

“I think Scentsicles has the potential to be a $100 million-plus brand … We have this bigger version to be the scent that you celebrate with. And it starts with Christmas. That’s the biggest one and we just want to grow from there. There’s no reason why we can’t be at weddings and birthday parties,” Kullback explained.

“We’re just at the beginning of that journey, but we have really big aspirations,” she said.

‘So much great stuff’

At Stew Leonard’s, the family-run grocery chain hasn’t raised any prices so far due to the impending tariffs, according to Chief Operating Officer Jake Tavello, the grandson of founder Stew Leonard and nephew of current President and CEO Stew Leonard Jr.

As a farm-fresh grocer, Stew Leonard’s tries to locally source as much produce, meat, dairy and other goods as it can for its eight stores across New Jersey, New York and Connecticut.

Less than 10% of the items at Stew Leonard’s are sourced from outside of the U.S. The grocer’s two biggest imports – Canadian salmon and Mexican avocados – are excluded from tariffs at this point because of the USMCA trade agreement.

“I can’t speak for other businesses, but we’re probably in a better position because – and this happened during COVID, too – the fact that we have so much local and we have such longstanding relationships with our suppliers,” said Tavello.

He added that in New Jersey the grocer work with close to 200 vendors. “That’s what we love about being in this area. If you were living in the middle of the country, there wouldn’t be this opportunity, but we have so much great stuff right around us,” Tavello said. “We’ve built this business off of local. Not just because of convenience and price, but because of freshness. Most of the stuff we can get to the store the same day … And it’s not just the sourcing—it’s great product, too. The blueberries, the corn and the seafood – you can’t beat those. We’re lucky here. When people come and visit us where they can’t believe just how much access we have to all this fresh stuff.”

“There’s also a lot of opportunities to pass on value. I was just talking to our seafood buyer and we get a lot of our lobsters from Maine, and they were counting on exporting some of that. And so, they called us and they needed some help,” Tavello said.

“So, for Mother’s Day, we were able to offer lobsters for $12.99 compared to $19.99 last year,” he said. “And we’ve got some good deals coming up with lobster tails for the next two holidays. So, there’s been some actual opportunities that we’ve been able to help out this Maine lobster supplier, and then we’re able to pass that right on to the customer.”

“Most of our suppliers we’ve been working with for 30, 40 years. And that’s why we’re able to work out these great deals them and … find opportunities where they can help us and we can help them,” Tavello added.

In a recent newsletter, Stew Leonard’s CEO noted that most of the importers of European wines and spirits purchased extra shipments “pre-tariff,” therefore the grocer hasn’t seen any tariff-imposed price increases yet.

“Some of our suppliers and distributors have said they’ll see some prices go up on a few brands in June, but they’ll roll the prices back again if there are any policy changes,” he added.

According to the CEO, the cost of bananas and pineapples went up because of the tariffs, but Stew Leonard’s is splitting those increases with its suppliers so that shoppers don’t feel the pinch.

Tavello said that Stew Leonard’s “got ahead” on most of the other items that are international, such as certain cheeses and gourmet sauces.

“We can’t guarantee what’s going to happen. With any commodity, you have to ride the wave and adjust as we go. But the good thing is since we’re a family business, we can kind of play by our own rules. We’re not a public company. And at this point, what we want to do is obviously offer as much local as possible. We don’t import a lot, but if there is, we’re going to try to absorb it the best we can,” he said.

“Being a smaller family-run company, we can adjust quickly … Our thing has always been fighting to have the best product and the best value for our customers. So, our buyers and our team are working really hard and on the phones all the time to make sure there’s availability to a good, quality product,” he said.

“If anything, we’ve been improving it and at a good value. So, I could see there’s a lot of uncertainty right now. And obviously things change by the day, so we don’t have a crystal ball, but right now we feel good that we’ve been able to not raise any prices and still keep a good shopping experience in the store,” Tavello added.

‘Cautious’ shoppers

Tavello’s late grandfather began the business as a single store 55 years ago in Norwalk. Known for its animatronic characters and selection of dairy, meats, seafood, produce, bakery items, cheese and restaurant-quality prepared foods, the New York Times nicknamed the chain “the Disneyland of Dairy Stores.”

The chain made its New Jersey debut six years ago in Paramus and added a second in-state spot last year in Clifton. It also recently cut the ribbon of its second swim school for kids, located in the same shopping center as its Clifton store.

“Overall, I would say people have been cautious. But they’re still spending money on food. Maybe on average there’s about one less item in each basket overall,” Tavello said. “I think people are just kind of cautious and waiting to see what’s going to happen because something’s changing every day on the news and that’s kind of creating this sense of panic. But we’ve been just trying to reassure everyone that supply is good.”

Stew Leonard’s is also trying to show shoppers it is committed to helping them weather the current economic uncertainty.

I think people are just kind of cautious … because something’s changing every day on the news and that’s kind of creating this sense of panic. But we’ve been just trying to reassure everyone that supply is good.
– Jake Tavello, Stew Leonard’s COO

“With people being cautious, private label is a good way to get things at a value,” Tavello said. “I think we’ve built up a pretty trusted, reputable brand, and with great quality. Our sauce that we put our name on, it’s $2 less than Rao’s, but it’s a great sauce. So, we want to continue to grow that. We’ve got probably 10 or 15 new items coming in the next couple months for private label within dairy and grocery and other areas.”

The chain also revamped its rewards program to allow customers to redeem points for private label products and some prepared foods in response to shopper feedback. Up until about a month ago, points could only be applied to free ice cream or coffee.

Looking ahead, Tavello said the grocer aims to build up its e-commerce site to allow shoppers to purchase their favorite Stew Leonard’s branded item and have it shipped directly to them.

“We have so many people that have lived around our stores, and then we’ll move to Florida or other areas and they’ll still want our coffee or our rice cakes,” he said. “We just hired a new chief marketing officer who came from FreshDirect, and she’s going to be kind of putting that together this year. Stew’s is on the news all the time and our name is pretty well known. I think if we can ship it at a reasonable cost, being able to send our private label around would be a good thing.”

Growing its NJ presence

Tavello said Stew Leonard’s aims to continue to grow its brick-and-mortar footprint in New Jersey.

In addition to the local produce access and sense of community the grocer has found in Paramus and Clifton, Tavello said, “Having the food and wine together has been such a good combination. In New York and Connecticut, we have to keep it everything separate. So, I think just a better experience too for the customer. We definitely have our radar open. Nothing has popped up at the moment, but I would say New Jersey is somewhere we’re definitely looking pretty closely at.”

Given the competitive supermarket scene in New Jersey, Stew Leonard’s strives to set itself apart from the pack by making itself a destination for fun, unique in-store happenings, Tavello said.

“I think what makes Stew’s great are these cool little food and family events,” he said, noting activities like Easter egg hunts, Touch-a-Truck programs, kids’ cooking classes, holiday breakfasts for little ones and food and wine tastings.

Recently, the chain hid Willy Wonka-inspired golden tickets inside of its new Dubai chocolate bars for eight lucky winners to score a 2.87-pound, jumbo-sized bar made by Norwalk-based chocolatier Fritz Knipschildt.

Stew Leonard’s also held a parade featuring its lineup of costumed characters. The inaugural event at the chain’s store in Norwalk last October was so successful that Tavello said they’ll be bringing it to other locations this year.

“I have two sons – one is four, one is two, and we took them to Sesame Place …  and they had a character parade at 3 p.m. and shut down the place so there’s a big parade of Elmo, Big Bird and everybody,” Tavello said. “I thought to myself, ‘We’ve got all these characters – why don’t we try that?’ We had like a thousand people show up … it’s amazing how people get so into the characters.”