Overview

Recent adjustments to import duties in key global markets are reshaping cost structures for sellers on Amazon, Shein, and Temu. The lack of clarity around tariff rates has forced platforms to modify order handling and prompted sellers to rethink pricing, inventory levels, and profit strategies. Understanding these ripple effects is essential for maintaining competitiveness and protecting margins.

Key Points

• Tariff volatility — New duty hikes on Chinese‑origin products have lifted landed costs across multiple categories, compelling sellers to revisit their pricing formulas.
• Platform response — Amazon now cancels vendor‑generated purchase orders when tariff outcomes remain uncertain, while Shein and Temu keep orders open but extend shipping windows.
• Margin compression — Combined increases in import fees and freight charges are eroding profit margins, especially for low‑priced items.
• Inventory risk — Stockpiling inventory before a tariff announcement can create excess that becomes costly to move if duties rise.
• Consumer price sensitivity — Shoppers are reacting to higher retail prices on staple goods, pushing sellers to balance cost recovery with competitive pricing.

How Tariff Changes Affect Sellers

1. Cost recalculation — If a 10% duty is announced on a product line, a seller importing 1,000 units at $5 each sees landed costs climb from $5,000 to $5,500. The seller must decide whether to absorb the $500 increase or pass it to buyers.
2. Order‑level adjustments — Amazon’s system now flags purchase orders tied to goods under pending tariffs. When the duty rate is not finalized, the platform may automatically cancel the order, as occurred with several vendor‑managed inventory (VMI) shipments in Q1 2024.
3. Pricing strategy shift — On Shein and Temu, where orders continue, many sellers raise list prices by 5–8% to offset higher landed costs, while closely monitoring conversion rates to avoid traffic loss.
4. Supply‑chain re‑routing — Some sellers diversify sourcing to nations with lower or zero tariffs—such as Vietnam or Mexico—adding lead time but reducing duty exposure.