She launched her Korean skincare brand just as tariffs hit. These are the lessons she learned about owning a business.

Irene Ham launched a South Korean cosmetics brand called Poom Cosmetics amid tariffs.Irene HamIrene Ham purchased $62,250 in inventory for her new Korean skincare brand when the Liberation Day tariffs hit.She didn't end up being subject to the tariffs, but she had to pause her skin cleanser product.Ham learned valuable lessons about owning a business as she navigates a challenging launch period.30-year-old Irene Ham had just poured $62,250 of savings into inventory for her new Korean cosmetics brand when President Donald Trump's Liberation Day tariffs were announced on April 2.The shipment had been ordered but hadn't arrived yet. She said her heart sank when she heard the news."When the tariffs hit, it obviously was such an emotional piece of news for me," Ham, who recently launched Poom Cosmetics after working on it for two years, told Business Insider.Ham said she had ordered the bare minimum the South Korean factory would allow — and even that pushed her financial limits. Then came the news of a 10% baseline tariff and a 25% "reciprocal" tariff, which she said would have made it impossible for her to move forward with her business. Ham was facing the possibility of over $21,000 in added expenses for the inventory shipment from South Korea. On top of that, her product packaging was sourced from China, which was set to be affected by a 54% tariff rate.Because she paid customs before the tariffs went into effect, Ham avoided having to pay the tariffs on the South Korea shipment. However, she said the ongoing tariff uncertainty has led to setbacks.She decided to pause launching a new face cleanser product line due to "unforeseen costs," though she had already finalized the formula, approved it, and completed the packaging design with her manufacturer.Ham said she's been told she picked the "worst time" to start a business. Along with tariffs, the looming possibility of a TikTok ban poses a threat to her marketing efforts as she's built a following on the app by documenting her entrepreneurial venture.Despite the challenges, Ham said that after reading up about the tariffs and learning they could be used as a negotiation tactic, she realized the situation wasn't all doom and gloom."I think if I started a business when it was all easy, everything was in my favor, then I don't think I would have the resilience to make it last," Ham said. "So, a part of me is actually a little thankful that it's the worst time to start."The art of the pivotHam said she initially panicked about the newly announced tariff rates. But then she realized that she wouldn't necessarily have to raise her prices by 25% overall. The cost to manufacture her foundation would end up raising the price by $3 or $4 per bottle."So, adding that to the price instead of making it a huge astronomical number increase," Ham said, adding that it was more manageable.Ham also realized that she could survive without getting packaging materials like boxes and logo stickers from China, so she started looking into US-based suppliers like Uline and Sticker Mule, which didn't increase their prices.While that meant her products don't look as refined or custom-made as originally planned, she said sacrifices were needed if she didn't want customers to pay even more.There was even a perk from making the switch. Ham said the turnaround time is faster, and there's no bulk order requirement.Getting more confident in negotiatingAs a result of navigating the tariff impact, Ham told BI that she's gained more confidence negotiating with manufacturers, particularly on the minimum order quantities.Ham said some factories require 5,000 to 10,000 units per shade per product, which leads to a high order quantity and overall price."In future orders, I plan to negotiate that down to a number that feels fair for both me and the manufacturer," Ham said.The next time she negotiates a new order, she'll be able to test her theory — that manufacturers could be more understanding and open to negotiating, given the changes happening in the US.Keeping costs downAfter initially thinking she had to pay thousands of dollars extra after spending her savings on her first batch of inventory, Ham said she's learned to cut expenses wherever she can."I've been very lean on my startup costs because of the tariffs," Ham said, adding that she's looking for ways to keep healthy product margins so she can "better absorb future curveballs."For example, Ham said she has to pay for her Shopify account every month if she wants to have a preorder app. She decided that she just doesn't want those expenses to go up.Now, whenever she feels tempted to spend more on custom packaging or other extras, she asks herself if it will lead to more sales or if it's merely a "vanity metric."That mindset helps her make more cost-effective decisions, she said.Read the original article on Business Insider

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