Tariffs and Toys: Why US Manufacturing Nearly Failed

Last Updated on July 25, 2026 by Fiza Khurram

One Entrepreneur’s Tariff Workaround

As tariffs on imported goods have climbed sharply in 2026, small businesses across the consumer goods sector have faced a stark choice: absorb higher import costs, pass them on to customers, or attempt the difficult and often costly process of reshoring production to the United States. WS Game Company, a small manufacturer that produces licensed and specialty board games including special editions of Monopoly, chose the third pat and the experience offers a revealing, on-the-ground case study in just how difficult that transition can be.

After being hit with new tariffs on the imported components used in its board games, company founder Jonathan Silva decided to explore whether a U.S.-made version of a special-edition Monopoly game could be produced domestically, sidestepping the tariff costs entirely. What followed was, in his own account, an experiment that almost didn’t succeed a reminder that reshoring manufacturing involves far more than simply relocating a supply chain.

The Hidden Complexity of “Made in America”

Board games might seem like a straightforward product to manufacture domestically, but they involve a surprisingly intricate supply chain: printed game boards, molded plastic pieces, dice, cardboard packaging, and assembly each component often historically sourced from specialized overseas manufacturers who have built decades of expertise and cost efficiency in producing these specific items at scale. Finding domestic manufacturers capable of matching that quality and cost for each individual component proved far more difficult than anticipated, and several attempts reportedly required significant trial and error before a workable domestic production process was found.

Why This Matters Beyond One Toy Company

WS Game Company’s experience is a microcosm of a much broader trend playing out across small and mid-sized manufacturers this year. As tariffs have made imported components and finished goods significantly more expensive across categories from toys to apparel to home goods, thousands of small businesses have faced similar decisions about whether reshoring is a viable path or whether absorbing tariff costs and the accompanying margin compression is the more practical near-term option.

The Cost-Benefit Reality

For many small businesses, the math on reshoring is genuinely difficult. Domestic labor and production costs are typically higher than what companies paid overseas, even after accounting for new tariff costs on imports. That means reshoring doesn’t guarantee lower total costs it can simply shift where the additional expense shows up, from a tariff line item to a labor and manufacturing-cost line item. Businesses considering the move must weigh not just tariff avoidance but also lead times, quality control, minimum order quantities, and the capital investment required to establish new domestic supplier relationships or in-house production capacity.

What Small Businesses Are Learning

Entrepreneurs who have gone through reshoring attempts this year emphasize that success often depends on finding the right niche domestic manufacturing partners rather than attempting to replicate an entire overseas supply chain domestically in one step. Government and industry groups have also pointed to growing interest in domestic manufacturing capacity for specialty and small-batch production runs, a segment underserved by large-scale contract manufacturers historically focused on bigger orders.

Broader Implications for Consumer Prices

Whether through absorbed tariff costs, higher domestic production expenses, or some combination of both, the end result for many consumer goods categories has been rising retail prices a dynamic that ties directly into the broader inflation and Fed-policy debate playing out this year. Small businesses, lacking the negotiating leverage and diversified supply chains of larger competitors, are often among the first to pass these costs directly through to consumers, making them a useful early indicator of how tariff policy is translating into real-world price pressure.

The Bottom Line

WS Game Company’s near-miss reshoring experiment is a small but illuminating window into the operational reality facing thousands of American small businesses in 2026: tariffs are reshaping sourcing decisions in real time, but the path to domestic production is rarely as simple as swapping one supplier for another.

Reshoring Trade-Offs for Small Manufacturers

Factor Overseas Production US Reshoring
Tariff exposure High under current policy Eliminated
Labor/production cost Historically lower Typically higher
Supplier availability for niche components Established, mature Limited, requires development
Lead time to establish N/A (existing) Often lengthy, trial-and-error

Leave a Comment