Last month, the U.S. Supreme Court issued a stinging ruling against President Donald Trump’s tariffs because he had imposed them using an emergency powers law.
But the president responded in turn, announcing he would impose a blanket 10% tariff on all imports citing a different law. Now, two dozen states — including Arizona — are suing over it.
But, regardless of what laws are being cited to impose tariffs, they have hit many small businesses hard. Multiple studies have shown the costs of tariffs are being passed onto U.S. consumers and businesses.
Jon Przybyl says his local business has felt the effects firsthand. Przybyl is the owner of Proof Bread, and he says the tariff costs stopped them from opening a new location in Gilbert.
Full conversation
JON PRZYBYL: Yeah, we actually had to back out of a lease that we had already signed because the costs related to construction had more than doubled from the time that we had signed our lease in late 2024 to the time that the building was ready for us to renovate and make into a bakery location.
That was about a one year gap. And in that year, you know, the tariff policies hit, namely against construction materials. That was a pretty heavy sector that was hit by tariffs. So it materially changed the cost of beginning a new bakery from that state and made a project that we had already invested a substantial amount into untenable financially.
LAUREN GILGER: So it sounds like this is part of it, this, you know, basic supply of construction goods, things like that. But on the other side, you've also seen increases in prices of imported ingredients that you need, like wheat flour, things like that.
PRZYBYL: Well, I think that's where, look, we are definitely impacted by tariffs as a bakery. Although compared to many other small businesses that have supply chains that come from further away or have distribution chains that might be far away, I think shipping in general, which we have a little bit of exposure to, this was all heavily impacted by tariffs.
And it goes to sort of the other half of the discussion is that having a local business means that we are a bit more resilient to what happens internationally, further away, because, you know, our wheat supply chain is hyper local. But that doesn't mean that some of the inputs that our farmers use aren't impacted by the tariffs as well.
GILGER: So there is a ripple effect down the line, even to the growers, it sounds like.
PRZYBYL: Yeah. So even in a hyper-local business like a bakery that mills its own flour and partners with farmers here in Arizona across a couple counties, we still will be hit by this in sort of unexpected ways, because some input that one of our suppliers needs in order to do their job is affected by the tariffs.
And so, you know, it has an inflationary effect on the business, which definitely changes the calculus on when we, you know, invest huge amounts of capital into a new bakery, but also impacts our ability to hold our prices firm.
GILGER: Yeah, yeah. So you've also had to raise prices because of these kind of global and international economic shifts, which seems so, I guess, counterintuitive, because, as you say, you're such a hyperlocal business. But what went into that decision? Like you, you wrote to customers when you raise prices that you're navigating this challenging economic climate, but you know that customers are too.
PRZYBYL: Yeah, yeah. You know, I think ultimately we have a challenging responsibility in the sense that we legitimately feed the community. We serve about 7,000 families a week. And f a loaf of bread is 10 servings of food, you can sort of do the math and see we're serving tens of thousands of servings of food every single week out of our bakery. So it's a big responsibility in feeding a city.
At the same time, we have a responsibility to our staff. And these rising costs rise for everybody. It's not just for the business. Yes, it is for our customers. It's also for our teams. And so, you know, we have to be very careful about the decisions we make so that the bakery can be sustainable, so we can keep paying our staff fair wages, so that there can be some sort of affordability in our entire community.
And so it's striking a balance. And yes, you know, we're transparent with our customers. When we have to make a move like this, where we are legitimately asking for our customers to trade a little bit more of, of their precious resources in, in funds in order to make sure our business can continue to feed the community.
GILGER: So where do things stand now for you, John? Like the Supreme Court struck down the president's tariff structure, and it sounds like at this point at least, he's replaced him with a blanket 10% tariff across most imports that could go up.
But is this still impacting the business? Was the Supreme Court decision good news for you?
PRZYBYL: I think it's hard to really know what to, what to put faith in because the information sort of coming at us is, you know, different, depending on which, you know, government body. It's confusing and conflicting information. And so I suppose on this end, we just have to see what will shake out.
At Proof we have a core value of, one of our core values is resilience. And I think it's because since the beginning, we, you know, yes, we've experienced a lot of growth. Growth isn't easy. It comes at a cost. When you're growing from a hand mixed operation with very rudimentary tools to, you know, a bakery spanning multiple locations, there's a lot to buy along the way, a lot to invest in, a lot of new people to employ, new systems to create.
There's just a lot of problems along the way. And I think we treat this like the many problems we face on a daily basis, albeit, you know, it's it's an unfortunate instability that seems, from my lens, avoidable.
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