After 22 Years in Business, Tariffs Are Pushing This New Jersey Company to the Brink

Babco Foods International, a New Jersey–based company, has spent more than two decades building a stable business. This year, that stability has unraveled — not because of falling demand or mismanagement, but because of tariffs that have drained the company’s cash flow at an unprecedented rate.

Babco shared the reality they are facing:

“Babco Foods is suffering huge cash-flow issues as a result of paying 50% in tariff on goods imported from India. We are a 22-year-old company. This is the first time we are in such a dire situation. Most of our retained earnings of past 22 years are being used to meet tariff payments and to retain our staff. We will not be able to continue much longer.” 

In total, Babco has paid more than $400,000 in additional tariffs — an amount large enough to erase years of savings in a matter of months. For a long-standing small business, retained earnings are meant to support growth, stability, and employees during downturns. Instead, those reserves are now being used simply to keep the doors open.

This is what tariff policy looks like in practice: cash tied up at the border, operating funds depleted, and businesses forced into survival mode regardless of how responsibly they’ve operated for decades.

Babco Foods’ experience underscores a reality many small businesses are now confronting — that tariffs at this scale don’t encourage domestic investment or resilience. They exhaust it.

📢 If your small business has been affected by tariffs, add your name to our open letter. These stories help show how trade policy decisions are impacting real businesses, workers, and communities across the country.