🔒Survival tactics: How small Maine businesses are navigating the rising cost of everything

Fuel and utilities. Raw materials and packaging. Payroll and benefits. Real estate. Rising costs of everything are eating into the bottom line of small businesses across Maine’s economy. Veronica Stubbs in Belfast is feeling the pinch on several fronts at the Scone Goddess, a small manufacturer she owns with her son. In the past few months alone, she has been paying three times as much for cocoa from Holland, 72% more for gluten-free flour from Denmark and close to 50% more for candied ginger. She’s also paid as much as $1,300 per 20 pounds of freeze-dried raspberries from Florida, up from $880 at the end of 2025 and constantly in short supply. Packaging from Pennsylvania is 10 cents higher. All that adds up quickly for a seven-person team with a monthly production capacity of 40,000 mixes. Yet Stubbs, still foregoing a paycheck six years after launching the business in nearby Northport, feels guilty about raising her wholesale price by 15 cents a bag this year for the first time since 2024 and upping her retail price by 10 cents a bag. “The hardest part of running the Scone Goddess,” she says, “is staying ahead of costs.” On a self-proclaimed mission to “change the world one scone at a time,” the former bed-and-breakfast owner aims to keep prices low as long as possible. “We do not want to be a brand that is so expensive that it prices out our fans.” That’s the dilemma facing small businesses everywhere, squeezed between rising costs and reluctance to pass those costs on to customers. Even those that aren’t tracking economic indicators face daily reminders every time they drive by a gas station or buy groceries. Nationwide, annual wholesale inflation was 4% in March, the highest rate in more than three years, driven by a 15.7% jump in gas prices as the Iran war curbs global crude oil supplies. Diesel fuel, jet fuel, home heating oil, meats and basic organic chemicals all rose as well. For small businesses, “it’s all those things hitting at once that makes it unique,” says Brien Walton, a business professor at Husson University in Bangor. “It’s almost as if a lot of businesses are afraid to hear the next bit of financial news.”

Double whammy

Rising inflation pressures and broader uncertainty are taking their toll on small business confidence, as shown in the latest quarterly barometer by the U.S. Chamber of Commerce. Out of 751 small business owners and operators surveyed between Feb. 15 and March 11, more than half cited inflation as their biggest concern. While that’s been the top challenge for more than four years, worries over the cost of employee benefits are also rising. As businesses grow more cautious, significantly fewer plan to add staff or ramp up investments in the year ahead — a trend that raises red flags with Tom Sullivan, the chamber’s senior vice president for small business policy, pointing to worries about consumer spending drying up.

While Sullivan doesn’t expect that to happen as long as the job market stays tight, he views rising gas prices as a double whammy for small business owners — driving up input costs and dampening their expectations. “You’ve got the spreadsheet impact and the emotional impact,” he says. “Those things can be pretty devastating for a small business outlook.” As small businesses face price pressures from larger suppliers, their ability to adapt quickly — evident in the surge of startups launched after the pandemic — is a strength, he says.

‘Adapt or die’

For many businesses, small changes can go a long way to boost efficiency. At Graze in Northport, owner Kate Hall reduced the size of bottles for cold-press juices to save $15,000 a year. “Adapt or die” is the guiding principle for the former fashion designer, who started growing microgreens for health reasons and launched her juice business in 2018. To save money on distribution costs, she joins other small businesses on co-shipping across Maine, sharing delivery runs with the Blue Hill Co-op about an hour away and Tortilleria Pachanga, a wholesaler in Scarborough about two hours to the south. “That’s been really helpful, saving on operating costs,” says Hall, who plans to soon source ginger from a grower instead of importing the spice from Peru. She currently has 11 employees on staff, with plans to add six part-timers this year as she develops a shelf-stable product; that would have higher profit margins than the current lineup of juices that stay fresh only for three weeks.

Seeking to stay ahead of broader market pressures without getting overwhelmed, Hall says her goal is to “focus on my job and not be consumed by all of the noise.” Estabrook’s, a Yarmouth-based operator of garden centers with 30 employees year-round and more than 100 in the busy season, is also expanding while seeking to keep a lid on costs through a combination of measures, including targeted price increases in line with inflation over the past five years. On the operational side, the company aims to save on energy costs at its 55,000-square-foot state-of-the-art production greenhouse in Pownal completed last year. The complex is equipped with natural ventilation, shade curtains to protect plants in the summer with irrigation from a pond that collects water from rain and snow. While it’s too early to quantify the cost savings from the new facility, co-owner Tom Estabrook says that “we’re very happy and pleased with the efficiencies we’ve gotten there.”

Ladders and fences

From humble roots in rural Brooks, a 1,000-population riverfront town in Waldo County, Baldwin Apple Ladders has quietly climbed into being a multistate wholesaler. Founded in 1984, the four-person operation supplies wooden ladders for commercial orchards across New England, New York state, North Carolina, Ohio, Pennsylvania and Virginia, working with dealers in each market; it also sells to a small number of walk-ins at its shop. “I grew up on a farm in New York state and I used to play on ladders,” says manager Peter Baldwin. The owners buy high-grade saw logs sourced from western and northern Maine, adding rungs from a small wood manufacturer about 40 miles away. Rectangular rails are made from bigtooth Aspen wood, while rungs are crafted from ash before the finished product is treated with nontoxic preservatives. With prices of energy as well as parts inching up, Baldwin says the ladder maker may raise its own prices at some point. “We’re holding off for the moment, but we’re considering it,” he says. About 100 miles down the coast, in Cumberland, the family-owned Main Line Fence Co. designs, installs and repairs fences for residential clients in Greater Portland and commercial clients from Kittery to Augusta. With 22 fence installers on staff, the company imports cedar from Canada and buys steel from local vendors that source materials from around the world. Both inputs are subject to tariffs, compounding an increase in freight charges this spring directly related to the cost of fuel that make it more expensive to operate 22 gas-powered trucks and six pickup trucks as well as two flatbed trucks and two guardrail pounding rigs that run on diesel. Loaders, forklifts and other machines are also powered by diesel. “It’s been a bit of a rollercoaster for us with all the different global headwinds and supply chain challenges,” says Andy Leconte, manager of Main Line Fence.

Balancing act

While there’s little small businesses can do to combat political trade tensions, Leconte says that Main Line Fence has tweaked its ordering approach in the wake of rising fuel prices. Instead of placing one order of steel guardrail materials at a time, for example, the company now places orders for at least two full truckloads every quarter, though the volume varies based on the types of jobs and work backlog. “It’s challenging from a scheduling perspective because jobs happen at different times … so we are finding ourselves sitting on material here on the ground longer in some cases,” he says.

Employee costs have also gone up. “When entry-level wages grow, we feel the need to increase the wages of our current staff,” he says. Juggling market rates, the cost of living, cost of benefits and overall labor rates “is a delicate balance.” Optimistic about future growth on the heels of investments in employees, equipment and facilities during boom periods, Leconte said the company is nevertheless “realistic to the fact that market conditions may change for the worse.”

Service firms shift gears

Firms offering services from cleaning to insurance are also adapting. Even with a contract workforce rather than in-house staff, labor is the biggest expense for Cleaners Joy, a Portland-based business that cleans private homes, Airbnb vacation rentals and businesses. “The cost naturally scales with the business,” says Hussein Adan, who founded the agency in 2022 after graduating from the University of Southern Maine with a marketing degree and some entrepreneurial experience. “The larger the home or job, the more staff is required.” He prefers the independent-contractor business model because of fewer administrative hurdles than direct hires. “It functions like a partnership where we and the cleaners complement each other’s businesses,” says Adan, who was born in a Kenyan refugee camp during the height of the Somali Civil War and grew up in Lewiston.

The 27-year-old runs the Portland-based business from Richmond, Va., working with 20 to 30 cleaners in Maine and about 15 in New Hampshire who clean homes and offices. The team includes fellow immigrants who were arrested in federal enforcement raids earlier this year. While Cleaners Joy charges customers a premium over the standard $25 to $40 hourly fee charged by solo cleaners, the agency recently added a $10 “convenience fee” to pay for higher software costs sparked by tariffs. Though some customers complained about the price hike, Adan says the majority have been understanding. With yearly billing rather than month to month, Adan saves around $200 annually on software to power his website, run background checks on contractors and to process payroll. But he still pays performance-based bonuses to cleaners, even though that cuts his 30% profit margin to 10% to 20% by the end of the month. Keeping abreast of the broader economy is a must for Adan in running his business. “Residential cleaning is essentially a luxury service, so any decrease in consumer spending on luxury goods directly affects our business,” he says. Payroll pressure is also weighing on Chalmers Insurance Group, a Bridgton-based agency with 94 employees and planning to hire more. To attract and retain commercial lines account managers, the family-owned firm recently raised the minimum compensation rate for that role by 22.5%. Even as insurance premiums rise, the company is leaning into technology and process improvements to streamline workflows and reduce manual tasks, according to Dottie Chalmers Cutter, a fourth-generation owner and chief operating officer who says her teenage daughter has an interest in becoming CEO one day. “We’re not simply absorbing rising costs — we’re rethinking how we operate,” Cutter says. Back in Belfast, at the Scone Goddess, Stubbs is looking at investing in automation. For now at least, she prefers to keep her business scrappy, like the chocolate factory immortalized in an episode of 1950s television sitcom “I Love Lucy,” where two friends gobble down sweets coming off the assembly line; hilarity ensues when the pace picks up with a frenzy. “I enjoy the Lucy and Ethel type of vibe we have with everyone pitching in, elbows deep in flour and pink raspberry dust,” she says.