In a major policy move, the Trump administration announced a new tariff plan last week, claiming the measures would strengthen the American economy.
The strategy includes a universal baseline tariff, targeted rates for key trading partners, and a steep new levy on foreign-made automobiles.
In this article, we’ll explore the main impacts of the tariff plan, and how ecommerce brands can react.
While updates to these tariffs are changing daily, here are the critical details to know:
Starting April 5, 2025, a 10% tariff will apply to nearly all goods imported into the U.S. The tax is paid by companies importing foreign products, though the costs may eventually trickle down to consumers.
Some nations will only face this base rate, including:
The White House has paused the customized tariffs imposed on roughly 60 countries previously labeled as the "worst offenders." While most nations will now face a flat 10% tariff on all U.S.-bound exports, China — which had retaliated with an 84% tariff on the U.S. — will see its duties increase to 145%.
The 10% baseline tariff does not apply to Canada and Mexico, as both countries were already subject to earlier tariffs under Trump’s previous policies. Instead, trade relations will continue under existing frameworks, including a 25% tariff on certain goods tied to border security and fentanyl concerns.
While some of these announcements may seem impactful, it's important to remember that the situation is fluid. Many knowledgeable insiders suspect this is the opening gambit of an "Art of the [Tariff] Deal" negotiation that will lead to lower tariffs with countries that are willing to cooperate. For example, see Israel's recent announcement that they have removed all tariffs on US goods; expect to see more such announcements. In other words, it is not recommended to make any major changes to your factory mix or countries of origin just yet, as the situation may quickly change.
The Trump Administration’s move to close the de minimis loophole by May 2nd has U.S. retailers cheering - with headlines declaring, 'Shein and Temu’s unfair advantage is finally over’.
But the truth is: de minimis was never really their unfair advantage.
While the de minimis loophole was the original advantage for ultra-fast, duty-free shipping, China-based brands (and U.S. DTC brands smart enough to follow their playbook) have already moved on to an even bigger financial advantage: tariff deferment.
Traditional retailers pay duties upfront, as soon as their container of goods enters the US - even if they don’t sell the goods for weeks, months, or ever! But brands like Shein and Temu use a direct supply chain model, which means they only pay tariffs after an item is purchased.
That means:
This isn’t just about fast fashion. Any U.S. DTC brands using the direct supply chain model will keep thriving while old-school retailers struggle under the weight of upfront duties.
Portless helps American brands to adopt the same efficient direct supply chain model used by Shein and Temu. Learn how their model can help with tariff deferment, simplified logistics, and improved cash flow.
Did you know that adjusting your product’s classification could significantly reduce the tariffs you pay? Sometimes, even a slight modification can shift your product into a lower-duty category.
Imagine you sell garbage cans. A basic step-open model falls under standard metal tariffs. But if you upgrade it to a motion-sensing, hands-free model, it may now qualify as a "mechanical device" rather than just a steel/aluminum product—potentially bypassing a 25% tariff.
Review your product classifications carefully. Could a small tweak in design or functionality move it into a better tariff category?
The First Sale Rule allows importers to base tariff calculations on the initial purchase price — not the final retail value. Here’s how it works:
If a manufacturer sells you a product for $5 and you later sell it for $10, customs duties can be assessed on the $5 transaction (not the higher resale price).
Now, this won’t eliminate tariffs, but it can substantially reduce what you owe.
Just make sure you have the proper documentation. You’ll need airtight paperwork (invoices, contracts) to prove the first-sale value. While complex, this strategy is a powerful tool.
Are you using the correct Harmonized System (HS) codes for your products? If not, you could be overpaying for no reason.
For example, we know a brand that started by selling microwaves. Over time, they added new technology and functionality, essentially transforming the product into an air fryer. As it turns out, air fryers fall under a different HS code that carries a lower import tax. That one change made a meaningful difference to their bottom line.
While we don't recommend switching manufacturing countries yet, if you have any production in Vietnam, you can utilize the Portless Vietnam fulfillment center to get de minimis benefits for as long as those are in effect.
Changes to product costs due to additional tariffs can obviously impact your bottom line. These changes will continue to be in flux, and you will need to ensure you have accurate and clear data to make quick decisions.
Luckily, there’s an agent for that. Triple Whale’s Revenue Insights Agent consolidates all of your product and margin data into easily digestible insights, allowing you to make informed decisions about merchandising and inventory.
This AI agent provides detailed breakdowns of gross profit and contribution margins so you can stay agile and operationally efficient, focusing your marketing efforts on the products that generate the most revenue during this highly volatile time.
The new tariffs announcement doesn't have to sink your margins — they can be managed, minimized, and maneuvered with the right strategy. But you don’t have to navigate this alone.
Portless helps American e-commerce and DTC brands to ship directly from China while legally deferring import taxes - keeping more cash in your business and improving cash flow.
And with Triple Whale, you can track the real-time impact of tariffs on your profitability, dynamically adjust marketing efforts, and stay on top of the one thing you can control: your own data.
Book a demo to see how agent-powered intelligence for your entire brand will have you operating ahead of the curve.
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