When the Daily Grind Gets Tough: How Tariffs Are Hitting Small Coffee Businesses

Coffee makes the world go ‘round. For many people, at least one cup in the morning is essential to feel fueled for the day. So, owning a coffee shop seems like a dream job: steady demand, loyal customers, and a product everyone loves.

But recent changes in the market challenge this thought. As of late September, the price of coffee in the US is up 39% compared to a year ago, according to Forbes. The main reason? Increased tariffs on imported coffee beans.

The sting of hiked coffee prices has been felt deeply—not just by coffee drinkers, but by the small, independent coffee shops, too.

In this post, we’ll break down what’s happening with tariffs, why it matters to small coffee businesses, and what to consider if closing your doors starts to feel like the right next step.

Key Takeaways:

• The Trump Administration recently imposed 50% tariffs on Brazilian imports, including coffee beans. Brazil is one of the two largest coffee producers in the world, alongside Vietnam.
• Customers, driven by habit and price sensitivity, will naturally seek cheaper options. Large chains like Starbucks can absorb costs longer—leaving smaller shops struggling to compete.
• Starcycle helps small business owners handle the hardest parts of winding down—so you can move forward with confidence and peace of mind.

The Real Reason Behind Soaring Coffee Costs

America might run on coffee—but we can’t grow enough of it ourselves. Our soil and climate simply aren’t suited for commercial coffee farming, which means the U.S. relies heavily on imports from Brazil and Vietnam.

This dependency makes American coffee shops vulnerable to international market changes. Recent events—bad weather, supply chain disruptions, and new tariffs—have pushed prices higher. “Bad weather and supply-chain disruptions (alone with new tariffs imposed by President Trump) have contributed to that price boost, but tariffs on imports from Brazil and Vietnam—the world’s two biggest suppliers—are threatening to send prices soaring even more” (Forbes).

On September 5, 2025, Trump signed an executive order updating tariff rules. While there is a possibility that coffee could be exempt in future negotiations, for now, it’s subject to tariffs up to 50%, along with other major Brazilian exports like beef, sugar, soybeans, and oranges (Forbes).

But many small coffee shop owners can’t afford to wait for “maybe.”

Why Independent Coffee Shops Are Struggling in 2025

The impact goes beyond coffee beans. The tariffs are raising costs on everything—from napkins and packaging to milk and syrups. Small shops, already operating on thin margins, are feeling the squeeze.

Large chains like Starbucks, on the other hand, have the resources and hedging strategies to delay price hikes. As Starbucks CFO Catherine R. Smith noted in a July earnings call, customers “shouldn’t expect price increases until the first half of fiscal 2026” (CBS). 

That’s time smaller shops simply don’t have.

When prices rise at local cafés but stay steady at chains, customers—many of whom buy coffee daily—often choose the cheaper option. Even a $1 difference per cup adds up over weeks and months. 

“Every time we kept buying coffee, it was just getting more and more expensive,” said Okon Udosenata, café owner of Equiano Coffee Roasters in Eugene, Illinois, who saw costs rise 30% while only raising prices 15–20%. “The uncertainty was too much, and the writing’s on the wall. It’s not going to come back down” (Lookout).

This story is increasingly common. Many independent coffee shop owners are realizing that despite their best efforts, the math just doesn’t work out.

Next Steps for Coffee Shop Owners Facing Financial Pressure

If you’re facing a “code red,” you’re not alone. This economy is creating brutal conditions — especially for small business owners like you who’ve poured everything into their work.

If you’ve reached the point where closing your doors feels like the right move, Starcycle is here to help. We specialize in making the difficult process of winding down as smooth, transparent, and stress-free as possible.

You’ve poured your heart into your business. Let us take care of the paperwork, logistics, and next steps so that you can focus on what’s next. Endings don’t have to feel like failures. They can be the start of something new.