Canadian businesses are facing major disruptions as tariff changes continue to destabilize their operations. With millions of dollars at stake and thousands of jobs in flux, companies large and small are caught in a cycle of indecision, unsure how to proceed in this climate of uncertainty.

For businesses ranging from global corporations to small enterprises, the constant shifts in tariff policies are causing more than just confusion—they’re affecting key financial decisions and stalling growth.

Small Business Struggles with Unpredictable Tariffs

One example of a business feeling the heat of these tariff changes is Kun Shoulder Rest, a well-known brand that manufactures ergonomic accessories for violins and violas, based in Ottawa. Despite its global recognition, Kun Shoulder Rest is struggling to adjust to the unpredictable tariffs placed on products sold in the United States, its largest market.

Juliana Farha, one of the company’s directors, explains that the U.S. accounts for roughly 35-40% of its global sales. With shoulder rests typically purchased once and kept for years, it’s difficult for the company to pivot to new markets when tariff policies change.

“The feeling of recklessness has created a lot of uncertainty for us,” says Farha. “Some of our international competitors aren’t facing the same tariffs, which makes our products even less competitive.”

For small businesses like Kun Shoulder Rest, it’s not an option to simply shift focus to other markets. There are only so many violinists globally, and the company has already expanded into regions like Europe.

Larger Companies Face Delayed Investments

But it’s not just small businesses that are struggling. Larger companies, with the financial resources to invest, are also holding off on making decisions due to the constant shifts in tariffs.

Take KP Tissue, part of Kruger—the largest manufacturer of toilet paper and tissues in Canada. Despite its financial capability, the company has postponed plans to build a new tissue plant due to the ongoing uncertainty surrounding tariff policies. Initially, Kruger planned to finalize its decision by early 2025, but now the company is delaying its investment.

The CEO of Kruger, François Paroyan, mentioned that the company needed additional time for due diligence because of unpredictable changes, including reciprocal tariffs from Canada, a weakening Canadian dollar, and fears of a potential recession. These factors have frozen their investment plans, and it’s unclear when the situation will stabilize.

Tariff Uncertainty Hits Steel Sector Too

The steel industry is facing similar turmoil. Algoma Steel, based in Sault Ste. Marie, Ontario, is also grappling with the unpredictable application of tariffs, particularly steel tariffs. Michael Garcia, CEO of Algoma Steel, says that every shift in policy forces the company to adjust on the fly.

“You have to keep your iPhone nearby,” Garcia quipped, explaining that even minor changes in tariff announcements could have a major impact. He noted that decisions are often unclear, such as when U.S. President Donald Trump announced a temporary suspension of some tariffs, which left many companies questioning whether steel-specific tariffs would still apply.

Garcia also shared that Algoma Steel is focusing heavily on preserving cash and reducing discretionary spending to weather the storm. For now, the company is avoiding investments until it has a clearer understanding of the tariff situation.

Widespread Economic Uncertainty Affecting All Businesses

Simon Gaudreault, chief economist at the Canadian Federation of Independent Business, points out that the uncertainty around tariffs is widespread, with both large and small businesses facing challenges. Companies struggle to adapt when policies are frequently reversed or changed, which is contributing to a broader sense of economic unease in Canada.

This environment of uncertainty has led to a reduction in hiring and investment, as businesses hold off on decisions until the situation becomes clearer.

“There’s so much fog right now,” Gaudreault said, explaining that businesses are avoiding market development and other investments until they have more predictable conditions.

Until the dust settles, the Canadian economy may continue to be plagued by inaction, with businesses of all sizes caught in a holding pattern.