MEGAPRO has always been proudly made in North America. It has been one of the pillars of our business since the very first screwdriver came off the assembly line (or assembly person). Our commitment to local manufacturing has helped us build the reputation for quality we have become known for and contribute to local economies in more ways than one. The screwdrivers we make have helped trades workers and homeowners build and maintain the world we live in for the last 30 years.
As a company that manufactures in the USA, MEGAPRO is part of the domestic industry that intersects with tariffs, which are traditionally used to protect local businesses. In the reality of today’s distribution of resources, even locally made companies recognize that you can’t get EVERYTHING you need (materials, parts, packaging) from the country you operate in while offering both quality and affordable products. As a “North American” company, MEGAPRO also manufactures products north of the border, in Canada, which is where you'll find our head office. Canada is where our MEGAPRO ADVANTAGE’s inventor, Hermann Fruhm, grew up, raised his children, and cherishes his grandchildren. In recent years we also brought in 5 products that are manufactured in Taiwan as part of our dedication to offer premium tools to customers at fair and achievable prices (Our VDE line, and the PRECISION).
This means we have a group of passionate people in Niles, Michigan, in Langley, British Columbia, and across the Pacific Ocean who are dedicated to getting you tools that you can count on. This also means we are watching discussions about tariffs closely because we want to keep offering you quality tools at fair prices. Depending on how tariffs are rolled out in the coming weeks and months, a lot of local to US small business will be crunched. How so can vary as it is highly dependent on individual circumstances, but for the most part they can, and in many cases will have the following effects:
1) INCREASED COSTS OF RAW MATERIALS
One of the most immediate and visible impacts of tariffs on small manufacturing companies is the increase in the cost of raw materials. Many manufacturers rely on imported components or raw materials to produce their goods. As an example, tariffs on steel or aluminum imports can lead to higher costs for manufacturers in industries like automotive, construction, machining, and tool manufacturing. These increased expenses often squeeze profit margins, forcing businesses to either absorb the costs or pass them on to customers through higher prices. For small businesses, which typically operate with tighter budgets and less financial cushion, these cost increases can be more challenging.
2) REDUCED COMPETITIVENESS
Tariffs can also affect the competitiveness of small manufacturing companies in both domestic and international markets. Higher production costs resulting from tariffs may make locally produced goods more expensive compared to foreign competitors not subject to the same taxes in the same ways. When you’re manufacturing a premium item with intent of being affordable this is a challenge. There becomes a point where increased costs can force a company to have to raise their MSRP’s which can lead to them pricing themselves above what some customers are willing/able to pay regardless of the quality.
3) SUPPLY CHAIN DISRUPTIONS
Tariffs often disrupt established supply chains, forcing small manufacturers to seek alternative suppliers of materials or components. This can sometimes lead to innovation and diversification, but it more often results in higher costs and longer lead times. We can tell you after 30 years of being in business, including some serious supply-chain restraints on our ratcheting mechanism between 2020 and 2022, the process of identifying and setting up new suppliers can really strain resources, delay production schedules and allow for gaps in quality testing, impacting customer satisfaction and overall business operations. And in a world where people expect things they’ve ordered to arrive at their doorstep quickly (thanks Amazon!) every little delay can prove costly.
4) OPPORTUNITIES FOR DOMESTIC GROWTH
In some cases, tariffs can present opportunities for small manufacturers by encouraging domestic sourcing and production. Policies that prioritize local goods can create a more level playing field for domestic producers, potentially increasing demand for their products. For small manufacturers that can pivot to use domestic materials or cater to new market niches, tariffs can serve as a benefit. There may be a local supplier that better suits your company’s operations and having to re-evaluate your supply chain could allow you to discover that new business partner.
However, seizing these opportunities requires strategic planning and investment, which may not be realistic for all small businesses. In addition, potential business opportunities created by tariffs are often unevenly distributed across industries, leaving some sectors struggling while others thrive. Sometimes it’s impossible to source what you need locally, so you’re stuck importing goods that will be subject to tariffs.
WHAT THIS MEANS FOR THE FUTURE
It's impossible to predict exactly how these new tariffs will shape business moving forward, but it isn’t difficult to see that things are about to change. If these tariffs become a long-term condition, then companies, big and small, will have to do their best to adapt. The more agile and proactive you can be as a manufacturer, the better you’ll be able to handle any large-scale change to the business landscape in general. MEGAPRO has had its share of challenges to meet over the years and this will be no different. We are committed to making our customers lives easier and so we’ll be looking for all the opportunities we can to help our commitment to domestic production flourish while also meeting our commitment to offering premium and accessible products.