Canadian and U.S. firms find creative ways to absorb tariff costs

New U.S. tariffs adding 50 per cent to targeted Canadian-made goods are forcing businesses like Gear182.ca in Brampton, Ont., to absorb costs, with owner John Melich saying he loses money on each sale rather than passing fees to customers. Melich must prepay tariffs before shipping, and his raw materials are also hit by counter-tariffs, leaving him paying on both sides of the border. Economists say companies may absorb costs, negotiate with importers, or pass them to consumers depending on market competition. Canadian appliance retailer Sam Zahler plans to absorb counter-tariff costs starting Sept. 8 by working with U.S. suppliers to reduce discounts, while some customers are rushing purchases before the new fees take effect.