Tariffs may sound simple on paper, but they unleash a tangle of costs for small businesses

• Tariffs are setting off shockwaves, squeezing small exporters while global giants stay largely insulated.

• When the US ends its de minimis exemption at the end of August, shipments stalled and costs soared.

• From potential inspections to inventory losses, small businesses now face risks on top of tariff uncertainty.

When Jon Calma Vagara's packages came back to his doorstep in Singapore, he knew something had gone very wrong.

Vagara runs JCV Custom Works, a tiny 3D printing business that has sold stencils for fishing lures since 2019. Nearly all of his orders are bound for the US.

In late August, when the US scrapped its de minimis exemption on small-value imports, Singapore's national postal service suspended shipping to America. So Vagara switched to a private courier — but his first shipments never left Singapore.

"I kept calling and they told me my goods were already in the US," he told Business Insider. "Three weeks later, they returned everything. I was very angry."

He eventually found another private courier that cleared the additional paperwork and got his parcels through in about a week.

But the fix came at a cost: Where he once charged a flat $15 for shipping, he now bills US customers $25. It's a meaningful increase for his products, which cost $14 to $75 each. But it's still below Vagara's final cost of about $36 to ship each item, after taxes and other incidentals are accounted for.

Vagara also had to take time to study obscure Harmonized Tariff Schedule codes — previously a formality that is now critical in determining tariff rates for the four to five parcels he ships each week, with each one totaling $200 to $400.

"In the past, I didn't have to declare the HTS code. Now it's important," he said.

His products are reaching buyers again, but his profits have taken a 10% to 15% hit, and he implemented a minimum order of $50 to manage costs.

He's also now factoring in business costs — like faltering logistics or higher costs for replacing lost or damaged products — that could cut his takings by 40% to 50% compared to the pre-de minimis exemption period.

"I always guarantee that they'll receive their products or I'll send replacements for free," he said.

Vagara's stencil e-commerce business isn't his bread and butter — he is a partner at an interior design firm by day — but the side hustle makes up 20% to 25% of his monthly income.

"Although this is just a side job, it helps me a lot in my monthly expenses," he said.