Let’s Talk Tariffs.

Over the past few weeks talk about tariffs has increased at Aktiv. Customers want to understand what they mean to our business and what the future looks like for us. With that in mind, we thought we would explain the trade landscape as we see it.

Tariffs & Transparency

For a small business like Aktiv, obstacles to profitability and longevity loom around every corner. Since January of this year, one challenge has cast a larger shadow than most: tariffs. Before January, tariffs were a small part of a complex international business. Now, tariffs are a daily burden that are reshaping how we do business, threatening our growth, and undermining our ability to bring a curated selection of Scandinavian goods to the US market. Don’t worry- we aren’t going away- but we want to be transparent about what all of this means to us. In this post, we want to share our story—a candid look at how tariffs are hurting our small business, what it means for our customers, and our thoughts on how tariffs could smartly be used to cure some distinct problems in the global economy. Surprise. Raising tariffs due to an imbalance of trade isn’t the right way.

A Quick Background on Aktiv & Importing Goods

Aktiv was created in 2018 after we returned from living in Norway. While we lived in Oslo we discovered dozens of amazing brands that were not available in the United States. We began importing the very best of Scandinavian clothing and have grown to include 43 separate brands from the Nordics, and one brand from Italy to have an exception to our rule. Many of these are only available through us in North America. For some we act as the importer into the United States which is usually an easy process. Beginning almost immediately after his inauguration Trump’s slapdash trade war against the rest of the world has lead to some consequences for Aktiv. While our products are generally from Scandinavia they are produced in factories around the world. The initial tariff announcements caused a wave of unpredictability that has worsened over the summer. Our European partners have looked to us for the clarity that simply does not currently exist. Simply put, no one (possibly not even Trump) knows what the administration will do next — that is very bad for business.

Tariffs are taxes paid to bring a product into the United States. Retailers, like Aktiv, receive products in one of two classifications, DDP and DDA, from the producers. In the DDP category, Aktiv simply pays the wholesale price of the clothing and the producer pays the rest (shipping, duties, etc.). DDA is where the clothing is sold at a lower wholesale rate but Aktiv is responsible for paying for all shipping and duties charges. A majority of our brands operate under the DDP model while eight are brought in DDA. The mechanism for collecting the duties is also inconsistent. Generally, items shipped by DHL levy the duties (tariff) before delivery so we know what the duties charge will be before delivery. UPS bills the duties after the fact which is nice from a cash flow standpoint, but we do not know what the actual final price of the items will be for at least a week until the UPS bill arrives in the mail. Uncertainty at its worst.

A significant portion of our manufacturing takes place in Europe with the largest share being in the Baltic states. The Trump administration initially levied a 50% tariff on all EU products in the spring. That forced our partners into shipping most of our spring and summer lines before the April first deadline which moved a large amount of product into our store before we planned on receiving it. The Trump administration chickened out and paused the 50% tariff and instead incorporated a 10% across the board tariff. Subsequently, Trump on social media proclaimed that a 30% tariff would go into effect August 1^st. So, we are back in the same dilemma as we were in the spring, our shipments are about to take place and our partners are wondering if they should send them early to avoid the tariff. All of which upsets Aktiv’s plans.

At a very basic level business operates best when it can predict what is going to happen and the tariffs have thrown any attempt to predict what costs will look like into doubt. Because of this our partners have taken on several different strategies to push back against the tariffs.

Fewer Brands, Lower Production, and Lack of Certainty

A few have decided not to ship to the United States anymore at all. Sandqvist, our beloved backpack provider, and the second company we signed on with in 2018 has paused all shipments of product to the United States. So, if you’ve been thinking about buying a Sandqvist product, do it now, we aren’t getting any more in anytime soon. We don’t know if or when they will be back.

In addition, some brands have taking the step of limiting production. Skhoop, a much-loved Swedish skirt maker will not import spring/summer into the United States going forward due to the tariffs.

Other companies have pushed the tariff prices onto the retail partners and in turn raised prices for the end consumer. Many of our most popular brands including Bjorn Dahlie, Dale of Norway(returning to the shop this Fall!) and Hestra have increased prices for the Fall due to the tariffs.

A handful have decided to keep the status quo for pricing with the hopes that the tariff threat will dissipate.

For Aktiv this unpredictability comes at a time with enhanced economic uncertainty for many of our customers (scientific researchers, other business owners, government employees, etc.) and the results are that sales are down. Aktiv has also paused its plans to roll out its own line of clothing. The first delivery of which was to take place this fall and included beautiful everyday shirts made of merino wool and produced in Lithuania. The potential 30% tariff hike made that production unrealistic.

Reality

As evidence at how misguided the tariff policy is Aktiv, prior to deciding on production in Lithuania we tried to find production for our clothing line in the United States. The reality was that very few clothing manufacturing plants exist in the United States today and they fall into two categories; first, fast fashion that is plastic driven and results in a poor product or, second more premium production with diminished quality compared to Europe and almost a tripling of price.  In other words, the idea that these tariffs will somehow bring this form of manufacturing back to the United States is not a reality in the short term. In the long term, major infrastructure investment would need to take place to get apparel production to compete with the quality from Europe. To compete with the price… the US would need to subsidize the factories to make the prices work in the retail setting. Nothing in the administration’s “strategy” calls for this form of investment or support, it seems as if the sycophants in Trump’s orbit believe that this form of manufacturing will simply appear without effort. That has the same likelihood as the US growing its own coffee and bananas…impossible.

Is this legal?

Pardon us while we revert back to our legal backgrounds. Beyond their practical impact, there is also a serious question regarding the legality of the tariffs implemented under the Trump administration. Many legal experts and trade organizations have argued that these tariffs were imposed in ways that sidestep Congressional authority over trade. Traditionally, Congress holds the power to regulate commerce with foreign nations; however, the Trump administration invoked the International Emergency Economic Powers Act (IEEPA) to impose the tariffs. The IEEPA was adopted in 1977 and gave the President authority to regulate international commerce after declaring a national emergency in response to any unusual and extraordinary threat to the United States which has its source in whole or substantial part outside of the United States. Past crises have included sanctions against Iran after the hostage crisis, freezing assets of hostile actors linked to the 9/11 terrorist attacks, or the Russian invasion of Ukraine. Trump claims the “unusual and extraordinary threat” to the US is the trade deficit. With regards to the EU, the United States has had a trade deficit every year since trade started in earnest with the Union as a singular entity in 1997. Every single year. How urgent is a trade deficit with the EU that has existed for 28 years?  As the largest economy in the world, Americans are some of the largest consumers of goods. Meanwhile, for services and digital products almost every other country has a trade deficit with us. In addition, there is no specific threat that is articulated by Trump.

This broad use of executive power has been challenged in various courts and criticized as an overreach. On May 28, 2025, The Court of International Trade invalidated most of the tariffs finding that they exceeded the President’s authority under the IEEPA. The next day the US District Court for the District of Columbia issued a preliminary in junction prohibiting the enforcement of the tariffs while also concluding that the IEEPA did not authorize the President to levy the tariffs. Also on the 29th, the US Court of Appeals for the Federal Circuit granted the Trump administrations a temporary administrative halt to the CIT ruling which allows the tariffs to stay in place. Oral arguments will be heard in the appellate court on July 31st but a decision will likely be weeks or months away. During that time, the tariff rollercoaster will continue. Regardless of the appellate court decision, it is likely that the final decision will be made by the Supreme Court, which is hardly comforting.  The result is a cloud of legal uncertainty that not only hurts businesses like ours but also undermines the stability and predictability on which the world business community relies. As small business owners, we believe in clear, fair, and lawful trade policy—something that recent tariffs have called into question.

What should happen.

Congress should do their job and dictate the trade terms. There should be testimony, fact finding and sober reflection before tariffs are levied. It should be mentioned that tariffs aren’t all bad. China, the focus of much of Trump’s ire is home to some very bad actors on the global trade stage. From currency manipulation to outright thievery of intellectual property, many Chinese organizations should definitely be taken to task as they hurt the entire world market. A much better idea would have been for the US to rally the world together against China instead of lashing out at the entire world. Instead, the decision has been made to alienate long-term allies and trading partners. Elections have consequences and Aktiv is living with those consequences at every turn of our daily life now.

We hope that by sharing our experience, we can help raise awareness about the unintended consequences of tariffs—and rally support for the small businesses that form the backbone of our economy. Together, we can push for solutions that create opportunity instead of obstacles, so that small businesses everywhere can continue to grow, serve, and thrive.