As the new US tariffs begin to shake up Amazon, we look at what brands relying on China can do to stay resilient…
President Trump’s decision to raise China import tariffs to 145% has seen many Chinese Amazon Sellers begin to reconsider (aka raise) their pricing, or even to exit the US market completely – and in response, Bloomberg reported that Amazon has cancelled orders from suppliers in China and Southeast Asia to avoid rising costs, leaving some Amazon brands stuck with unsellable inventory and intensifying supply chain uncertainty.
While things may still change again, and while the policy technically targets China alone, there’s no doubt that this is a situation where the impact will be felt much further afield.
And indeed those effects are already being reported by some vendors, with reports of everything from cancelled POs and squeezed margins to vanishing Amazon support.
So, amidst all this uncertainty, what can your Amazon brand do to stay resilient through the storm? We asked our experts for their advice.
1. Reassess your cost structures
- Start by mapping out your full supply chain – from raw materials to manufacturing, freight and import duties – so you can pinpoint where the tariff increases might hit you hardest. This will help you understand which SKUs are most exposed.
- Next, model out your revised landed costs and assess the knock-on effects on your margin and retail pricing. Will certain products still be profitable under the new cost structure? If not, you’ll need to decide whether to reprice, delist or find efficiencies elsewhere.
- It’s also worth having honest conversations with your suppliers. Can costs be shared? Are there alternative suppliers outside the affected regions? Some may be open to renegotiating if it means preserving long-term relationships.
2. Get ahead of pricing strategy
- Don’t panic and apply sweeping price hikes across the board. Instead, review your pricing and see where you can be flexible. Can you absorb some cost increases? Where could price rises damage your conversions?
- Rethink how you communicate value. If cheaper alternatives are gaining ground, now’s the time to double down on differentiating your products with stronger messaging around trust, Prime eligibility, delivery speed and product quality – all things that matter to Amazon customers, especially in a market that’s volatile.
3. Review your market priorities
- If selling into the US is becoming unviable? It might be time to shift your ad spend and catalogue focus elsewhere – say the EU or Canada – choosing markets that offer less volatility and stronger currency performance for some.
- Look for the opportunities. If Sellers are leaving the US because of the tariffs, is there potential for your brand to exploit a new gap? If your cost base is more favourable, now’s the time to step up visibility and market share as competition shrinks.
4. Protect your Vendor or Seller relationship
- If you’re a 1P Vendor, cancelled orders could impact everything from your forecasts to your inventory management and cashflows. Make sure to monitor your POs closely and flag any irregularities early.
- In times of uncertainty, communication with your Vendor Manager is crucial. But it’s equally important to have a plan B. A hybrid selling model (Vendor and Seller) can help brands stay agile, balancing risk and retaining more control over pricing and stock in unpredictable markets – speak to our experts if you want more advice.
The Bottom Line
Yes, we’re in a period of unpredictability – but this is no time for your brand to sit still.
The best-prepared Amazon brands are the ones who understand their exposure, actively model their risks and adapt their strategies to stay resilient in the face of changing economic realities.
Whether you need to reshape your international strategy or want to look for new opportunities, our award-winning team is on hand to help – get in touch today.