The CEO and co-founder of the Ohio-based off-kilter pedal makers EarthQuaker Devices, Julie Robbins, has shared that the business is at risk of going bankrupt by the end of the year as a result of recently enacted tariffs, which have reportedly increased costs and slowed sales for the company.
Robbins faced federal lawmakers last week (on May 14) during a speech before the U.S. Senate Committee on Small Business & Entrepreneurship, stating (as reported by Akron Beacon Journal), “We have perfect credit and we’ve never missed a payment, but we’re rapidly running out of liquidity.”
Alongside her speech, she also provided written testimony showing that, over the course of 2025, the tariffs would result in the cost per pedal increasing from 2 cents on April 27 to $12.80 on December 28th – a 640% increase.
Exporting the pedals has also proved tricky, especially since the company depends on overseas sales. The company typically exported 30% to 40% of its finished pedals to foreign markets and even received the distinction of Exporter of the Year from the U.S. Small Business Administration in 2019. However, this level of export activity has been detrimental in the midst of the current trade war.
“This year our exports are down as much as 50% to 100% in some countries,” the written testimony continues. “Our customers say this is due to anti-American consumer sentiment and the global financial fallout from the chaotic rollout of U.S. tariffs. It is devastating to see America’s reputation fall so swiftly.”
And, in addition to increased exporting costs, nearly all of the raw materials needed to make the pedals come from abroad – with about 75% of the raw materials coming from China.
According to Brad Thorla, EarthQuaker Devices’s head of inventory systems management and purchasing, with the tariff percentages in flux, the company cannot effectively calculate what the actual costs of the raw materials will be once they arrive at American ports and go through U.S. Customs and Border Protection.
For Robbins and her husband, EarthQuaker president Jamie Stillman, losing the company is not an option – they have taken out $1.2 million across five loans for the company, along with putting their family home up as collateral.
Laying off any employees or cutting their pay or benefits is equally devastating. “My employees are so valuable to me,” she adds. “A lot of them have this institutional knowledge that will be so hard to replace. And they rely on their income from this job to support their families.” Robbins’ suggestion? To either reverse the tariffs or exempt small businesses.
Last week, President Trump hailed a “total reset” in U.S.-China relationships – with the two global superpowers lowering their respective tariff rates for 90 days. The United States has decreased the tariffs on Chinese goods to 30% from 145%.
While NAMM (The National Association of Music Merchants) President and CEO John Mlynczak has welcomed these changes, he asserts that the current “30-percent tariff on imports from China as well as the 10-percent tariff on imports from all other countries” will continue to negatively impact manufacturers and retailers across the country.
Alongside EarthQuaker Devices, other companies have voiced their concerns about the tariffs. Electro-Harmonix founder Mike Matthews has noted that the company has enough inventory to weather the storm for a short time but will nonetheless inevitably be affected by the increasing costs if the tariffs persist. Meanwhile, Morgan Amps has confirmed that the tariffs will have a noticeable knock-on effect on amp prices.
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