Editor’s note: This story is part of the annual Mosaic Journalism Program for Bay Area high school students, an intensive course in journalism. Students in the program report and photograph stories under the guidance of professional journalists.
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Inflation is putting pressure on small businesses as owners face rising costs, supply shortages and difficult decisions on pricing.
For many small business owners, inflation has turned expenses into challenges. Rising costs for ingredients, packaging and supplies are forcing entrepreneurs to rethink pricing and operations while trying to keep customers.
Mike Louie, chief financial officer for Cauldron Ice Cream on Brokaw Road in North San Jose, said inflation drives up the cost of his rent, utilities and supplies.
“It affects everything,” he said.
When he and his wife, Susan Louie, took over the store in 2019, a case of 210 eggs cost $60 to $65.
“Within three months, that skyrocketed to $125 a case,” Louie said. “It has come back down to roughly $90 a case.”
Four gallons of ice cream base cost around $37 when the shop first opened in 2018. By the time he took over a year later, the price was about $75. Louie said he was able to lower the cost to between $55 and $60 by measures such as changing the shipping company.
“I can’t absorb all the costs, but I can’t pass all of it on to customers,” Louie said. “There’s going to be a portion of my customer base that can’t pay the higher price.”
The shop’s signature nitrogen ice cream scoop now costs $9.25. Similar products previously sold for around $7 eight years ago.
Like many food industries, Cauldron Ice Cream faces the challenge of perishable ingredients. Products that are not sold within a few days must be thrown out, creating losses that Louie has to absorb. Louie said that of the six Cauldron franchise shops, his is the only one still open.
Similar obstacles have affected other local entrepreneurs.
Alaiyah Holland, 21, said she sometimes pulls strawberry items from her custom dessert business menu when the cost rises too much or the quality of the strawberries isn’t up to her standards.
Dippalicious, a custom dessert business she started in May 2024, began as a hobby, then sprouted into a business catering to birthdays, anniversaries and events on San Jose State University’s campus.
Customers are familiar with Holland’s regular chocolate dip, but with the rising prices, she has to switch brands to maintain financial stability. Other ingredients such as Rice Krispies, pretzel rods and decorating ingredients have all become more expensive over the past year.
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“It’s really hard being a food business and dealing with inflation because I feel we get hit the hardest,” she said.
By establishing a loyal customer base, Holland said raising prices requires careful consideration. She wants to remain affordable while making sure the business is profitable.
Entrepreneur Safiya Jawad, 15, a rising sophomore at Santa Clara High School, experienced similar challenges with her custom press-on nail business, Nails by Safiya, that started in 2025.
Jawad originally underestimated how much packaging and shipping supplies would affect her expenses. Those materials have become some of the largest costs she faces.
“Packaging supplies increased the most. It’s difficult for me to know my future or order volume, so I always order packaging supplies in smaller units,” Jawad said. “Buying smaller quantities definitely plays a role in inflation because the price keeps on rising.”
Jawad initially charged $15 to $20 for nail sets, but later increased prices to roughly $20 to $35.
The increase affected the flow of customers, so she introduced reward programs. Repeat customers can earn discounts and eventually receive free nail sets.
Jawad views inflation as an unexpected benefit. Rising costs taught her the importance of budgeting and carefully monitoring expenditures.
She now compares suppliers, tracks purchases, and organizes her business using spreadsheets, encouraging smarter financial decisions.
Holland and Jawad believe flexibility is necessary during today’s economy. They encourage business owners to adjust prices and business practices when necessary.
“Don’t be afraid to pivot, especially when it comes to your pricing,” Holland said. “If you have a specific clientele that you’re looking for, those people will find you no matter what.”
Chloe Dao is a member of the class of 2029 at Santa Clara High School.
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