After fighting high import costs this year, many local small business are hoping for relief in 2025.

Retailer Reva Minors, of Loquat Roots, has seen mushrooming costs to import herbs and spices for her tea crafting business. Just in the last year, total freight and duty costs for a 4lb box rose from $50 to $130.

“That includes 25 per cent duty, package tax and the cost of the courier,” Ms Minors said.

She has found that total import costs are sometimes more than the item itself.

Hair extension specialist Samaela Cannonier, of Certified Crowned Experience, said the cost of importing goods is “killing” her business.

“It is causing us to raise the price of merchandise, impacting the customer,” she said.

She is worried that her price point will get so high, people will simply buy the products online.

The beauty expert said small businesses do not have the same resources as larger corporations to defray expenses.

“The big local supermarkets can lower costs by bulk shipments in containers,” she said. “We cannot do that.”

Ms Cannonier was considering freight shipping. “It is cheaper, but unfortunately, it takes much longer.”

Courier Kenny Thomson, president of Mailboxes Unlimited, blamed the cost on their aircraft.

“The reason all couriers are expensive is because the jet that flies into Bermuda is super expensive, and it increased its rates drastically in September 2022,” he said. “As far as I know, all couriers had to respond to this cost increase with outward price increases. Nobody wanted to, but the couriers’ own costs increased so there was no choice but to absorb as much as possible, then pass on the rest.”

Glen Smith, of courier company ZipX, said they have not increased their rates, recently.

“In 2022, we received a fuel increase from the air charter company to which we leased space on the aircraft five days a week, which was 25 cents per lb and that is it.”

Kelly Sullivan, owner of the About Face Aesthetics and Wellness clinic, said the Government should consider helping new businesses for their first five years.

“A lot of the shipping costs are controlled by independent corporations,” she said. “The Government can’t do much about that, but they could give a break on duty. The retail sector is struggling quite a bit.”

Small businesses are not the only entities impacted. Bermuda Aviation Services Limited reported this month that higher material and shipping costs were impacting their gross margins.

Jamillah Lodge, director of communication and development at the Bermuda Economic Development Corporation, said the rising cost of fuel, logistical disruptions in global supply chains, and limited access to goods are all contributing to increased import expenses.

“Couriers may be seeing higher operational costs, which may be passed down to consumers,” she said. “While BEDC cannot directly control shipping costs, we actively work to provide solutions that mitigate the financial burden for small business owners.”

Since October 2023, the Israel-Hamas war has caused many ships travelling from Asia to the United States to bypass the Red Sea, and take a longer route around the Cape of Good Hope in South Africa, increasing shipping times by at least 9 per cent.

As a result, there has been more pressure on air freight, with some sea freight shippers moving goods by air to avoid the delays.

However, Bermuda Worldwide Shipping clearance officer Isobel Correia did not believe the issue faced by Bermuda importers is linked to the Red Sea shipping issue.

“Nothing about the shipping industry has slowed down in Bermuda, as far as I can see,” she said. “We are in the crazy season right now.”

The BEDC has several programmes that can help local small businesses with import costs.

Ms Lodge said they have a partnership with ZipX to offer discounts to new small business owners on shipping services to provide some relief for entrepreneurs needing to import products.

The organisation said their letter of credit programme, done with the support of customs, also helps small businesses reduce duty-related costs.

Businesses in the Economic Empowerment Zone can get customs duty deferment and improve cashflow.

“Another way to reduce costs could be to explore collective shipping models,” Ms Lodge said. “Consolidating shipments or establishing a shipping co-operative could reduce individual costs by sharing expenses among multiple businesses.”