Navigating the New Tariff Landscape: Smart Strategies for E-commerce Retailers

The e-commerce world is buzzing with concern over recent tariff changes and the upcoming modifications to the de minimis threshold. If you're feeling confused or worried about how these changes might impact your business, you're not alone. We're sharing our insights to help you not just survive but thrive in this evolving landscape.

What's Changing in the Tariff World?

Two major shifts are reshaping the e-commerce shipping landscape:

1. Expanded Tariffs: The US has reinstated and increased tariffs on many goods coming from different regions, including China.

2. De Minimis Threshold Changes: Starting May 2025, the current $800 duty-free threshold for imports will likely be reduced or eliminated specifically for shipments from China and Hong Kong.

These changes represent a significant shift from the environment many e-commerce businesses have operated in for years. However, with proper planning and the right logistics partner, they also create opportunities for savvy retailers to gain competitive advantages.

The good news? These challenges aren't insurmountable with the right approach.

Strategic Solutions for Forward-Thinking Retailers

1. Leverage Regional Advantages Through Direct Injection

One of the most important aspects to understand: the de minimis changes primarily target China and Hong Kong, creating opportunities for retailers willing to pivot to alternative regions.

What is Direct Injection?

Direct injection involves establishing mini-fulfillment centers in unaffected regions that receive bulk shipments from manufacturing origins. Products are then repackaged and shipped to US customers under the continuing de minimis threshold from these locations.

Prime Regions for Direct Injection:

• United Kingdom: With strong intellectual property protections, established e-commerce infrastructure, and an English-language business environment, the UK offers a compelling alternative shipping point.

• Australia: Political stability, robust trans-Pacific shipping infrastructure, and multiple free trade zones make Australia an excellent option for certain product categories.

• Other Viable Regions: Canada and select EU nations also present opportunities for creating "tariff firewalls" between Chinese manufacturing and US customers.

2. Consider a "Raw Materials" Approach

For brands that use raw materials to create their products (like supplements, cosmetics, or food items), there's another strategic option worth exploring:

• Ship raw materials to the US as B2B imports

• Complete manufacturing and packaging domestically

• Benefit from lower tariff rates on raw materials compared to finished goods

This approach not only helps mitigate tariff impacts but can also be marketed as "Made in USA" – an increasingly valuable selling point for many consumer segments.

3. Diversify Your Supplier Network

Now is the time to expand your manufacturing relationships beyond China. Speak to your suppliers about manufacturing regions including:

• Vietnam

• Indonesia

• Malaysia

• Mexico

Each offers specific advantages in terms of manufacturing capabilities, costs, and existing trade agreements with the US. Our team can facilitate introductions based on your specific product requirements and volume needs.

4. Optimize Your Inventory Distribution

As the economics of small-package direct shipping changes, consider shifting to a more distributed inventory model:

• Strategic regional distribution centers

• Bulk shipping to domestic warehouses

• Last-mile optimization from US-based fulfillment centers

Our network of fulfillment centers can help you maintain rapid delivery times while navigating the new tariff realities.

5. Leverage Expert Classification & Compliance Support

With thousands of HTS codes and frequent regulatory changes, professional classification services can identify opportunities for duty reduction that in-house teams might miss. Our customs compliance experts provide:

• Documentation preparation and validation

• HTS classification optimization

• Automated duty calculation

• Customs audit preparation assistance

Your 90-Day Action Plan

Partner With Experts to Navigate the New Normal

While these tariff changes present challenges, they're also creating opportunities for retailers who can adapt quickly with the right partners. Our team of logistics experts is ready to help you transform these regulatory shifts from potential obstacles into strategic advantages.

The retailers who will thrive in this new environment are those who view these changes as catalysts for building more resilient, diversified supply chains – and we're here to help you become one of them.