President Trump's tariffs could change one of the most booming sectors of retail: fast fashion.
Tax taxes on imports from the largest trading partners in the United States were averted at least temporarily by Mexico and Canada, but not by China, which received an additional 10% tariff for its goods this week. Trump's aggressive step that triggered a measured reaction from China showed immediate concerns about a potential trade war and higher costs for consumers.
In Trump's China Gambit, it was a decision to close a decades of trading gaps that made it possible to rock existing tariffs. This could change the landscape of online purchasing, especially for the Chinese e-commerce companies that have changed wildly successful websites such as Shein and Temu, which US buyers have tempted with bargain prices.
The brands, which are sometimes referred to as ultra-fat fashion, react immediately to trends and attract customers with almost incredibly low prices a two-part women outfit for Temu for $ 3.19 and a package with seven bras on Shein Sells for $ 12.69. They often send directly from the manufacturer to the consumer, cut middlemen and offer you an advantage over other retail giants such as Walmart and Target.
But this advantage could shrink now.
“It takes a little bit of your competitive advantage,” said Neil Saunders, a retail analyst at Globaldata Retail that studied fashion. Companies not only have to pay taxes for these articles, as it stated, but also subject their packages to a stronger examination of customs agents, which could lead to delays when shipping.
“You either have to be affected,” said Saunders, “or you have to use the prices for the consumer and since your entire business model is low prices, it can reduce sales.”
The influence was immediate. The US mail service announced on Tuesday that it would stop accepting packages from China and Hong Kong. But the agency had resumed the operation by Wednesday morning, In a statement The fact that USPS officials and customs agents were working on implementing “an efficient collective mechanism for the new China tariffs” and at the same time trying to minimize the delivery disorders.
Shein and Temu, whose representatives did not respond to inquiries about comments, had expected Trump's decision and has been working in diversifying their supply chains in the past few months, including the expansion of networks in the USA
The gap from the 1930s called the de -minimis – Latin for something that is so small that it is insignificant – the liberation enabled the programs that were evaluated below a certain threshold to avoid customs tasks. This threshold, which started at 1 US dollar, was collected over the years at 800 US dollars.
US customs and border protection that regulates the import of goods, estimates that in 2023 a billion packages were imported with the method report From the congress research service. The value of these packages was more than 54 billion US dollars.
The gap became a “main path” for online purchases from China in the US market, and the financial effects were large-fashioned from packages with low value from China in 2023 to $ 66 billion, a drastic increase of 5 , $ 3 billion in 2018.
“Many inexpensive products from China that depend on de Minimis may no longer be available on the market” Price hikes for US consumers.
The closure of the gap, added LU, could also destroy the hundreds of thousands of small e-commerce companies in the United States, which often rely almost exclusively on procurement from China, while larger companies often have more diversified procurement bases. However, Lu emphasized that many details of the change remain unclear, including the enforcement of customs agents such an arrangement in view of the short -term and high products.
The Decision of the President has been praised by groups to prevent drug abuse in the last few days sent him a letter The gap was used last month to flood the US market with Fentanyl and the forerunner chemicals that are required to manufacture the drug.
“The only way to divid this large artery for the flow of fentanyl and other illegal and harmful products into our country,” says the letter, “to end the entire performance that an importer by breaking out programs into smaller valued packages Inspection, tariffs and taxes can dodge. “
Despite the increasing international concerns regarding rampant waste, working injuries and carbon emissions, the world of Rapid fashion has continued to show its exponential growth.
The trend of European retail giants such as Zara and H&M has increasingly dominated by Shein in recent years, which is now headquartered in Singapore Target income For the year, $ 50 billion exceeds. And in recent times, Beforewhose parent company moved her headquarters from China to Ireland, quickly went from a relative who was unknown, the most downloaded app in the USA
Saunders, the retail expert who studies a quick fashion, said that he concerns companies while closing the gap, he does not expect to make them unnecessary. Since the items you sell are cheap, he found that it was added to the dollar between 10 or 20 cents.
“You won't disappear,” he said. “It won't make them expensive, it only makes them a little more expensive.”
Bloomberg contributed to this report.