Las Vegas small businesses report fewer customers and higher costs as tariffs and a tourism slump take a toll

What happened

Small business owners across Las Vegas say they are selling less and paying more, according to a Spanish-language report from the Las Vegas Sun. Owners told the Sun that fewer visitors, tariffs on imported goods and rising fuel prices are cutting into thin profit margins.

At Brew Tea Bar, sales are down between 20% and 30% from last year, owner Sou Ngo told the Sun. Ngo founded the boba shop in 2015 with two of his best friends, and it has since opened four more locations.

Why tourism matters for local shops

Frank Fossen, an economics professor at the University of Nevada, Reno, told the Sun that economic pressure hits Las Vegas small businesses harder because the city depends on tourism. He said there has been a large drop in tourism, especially international visitors, who tend to spend the most.

International and Canadian visits fell

International visits to Las Vegas fell 4.8% in 2025, according to the Las Vegas Convention and Visitors Authority, the Sun reported. Tourism from Canada, the largest foreign market for Las Vegas, dropped 17.4% from 2024 to 2025. Fossen pointed to damage to the reputation of the United States tied to tariffs, especially among Canadians.

The Sun reported that President Donald Trump, who began his second term in January 2025, has imposed shifting tariffs, including a 10% global tariff, a 25% tariff on many goods from Mexico and Canada, and fluctuating tariffs on China. Local tourism leaders have also been working to bring in business travelers, as covered in our look at the Vegas Effect campaign aimed at meeting planners.

Restaurants closing and cutting staff

An estimated 78 family restaurants closed in Clark County in the first half of 2026, according to RestaurantData, the Sun reported. Ngo said he recently learned two other boba shops had closed, and that many owners he talks with describe the Strip as empty.

John Simmons, owner of Firefly Tapas Kitchen and Bar, told the Sun he had to cut staff last year when business fell 15% from the year before. He said the restaurant is operating at a loss this year.

Costs keep rising

Ngo said the plastic cups his shop buys from China rose from 10 cents to 35 cents this year after conflict in the Middle East disrupted oil supplies. The price of the Japanese matcha the shop uses has doubled, which he attributed partly to the 15% U.S. tariff on Japanese imports and partly to the drink's growing popularity.

Higher prices for customers

Ngo has raised prices twice since Trump's second term began, the first time in June 2025, and a regular tea now costs about $1 more. He said the shop is pressing managers to track costs and labor closely. The owners considered replacing workers with touchscreen kiosks but decided against it.

Juanny Romero, chief executive of Mothership Coffee Roasters, told the Sun her company runs on margins of about 5%. A 12-ounce vanilla latte there now costs $7, up from $5.25 four years ago, a period that began before the current tariffs.

Fuel adds to the burden

The Sun reported that the U.S. war in Iran has disrupted global oil supplies and pushed up gas prices. AAA reported Monday that the national average was $4.33 a gallon, up about $1.30 from last year.

At a roundtable with U.S. Sen. Catherine Cortez Masto, D-Nev., Ricardo Corral, owner of Best Landscape LLC, said fuel costs at his company have climbed from $400 to $600 per vehicle each week. He said he is working long hours just to cover expenses and has sometimes covered costs himself to keep his employees working.

Uncertainty makes planning harder

Fossen told the Sun that the combination of higher costs and fewer customers squeezes profits and makes it harder for businesses to stay open. He said closures also hurt the businesses that remain, because nearby shops help draw customers to an area. He added that owners are reluctant to take on new costs or risks when they cannot tell whether they will be able to afford them.

What to watch next

• Whether business closures have peaked: Fossen told the Sun the peak may have passed if conditions hold steady, but things could get worse and lead to more closures.
• Tariff levels, which the Sun describes as volatile, including fluctuating tariffs on China.
• Gas prices, which the Sun ties to oil supply disruptions from the U.S. war in Iran.