Tariffs can sneak up on your business – through rising import costs, disrupted exports or shifting supply chains. And depending on where and how you ship, the impact isn’t always obvious.
Learn what tariffs really mean for your business, get practical insights, tips from experts and clear actions you can take to stay ahead.
Tariff updates (As of May 13, 2025)
- US is lowering its tariffs on China from 145% to 30%
- China is lowering its tariffs on the US from 125% to 10%
- Trump drops reciprocal tariffs to 10%, pauses higher tariffs for 90 days
- Steel/aluminum tariffs (25%) in effect since March 12.
- De minimis ends May 2, adding duties for US retailers importing cheap Chinese goods, raising prices.
Tariff meaning explained:
Definition, what’s changing – and why it matters for retailers
Tariffs are taxes on imported goods. They’re designed to drive up prices to support local industries and generate government revenue – for example, tariffs were once responsible for roughly 95% of US income before 1913. For retailers today, tariffs mean higher costs on imported stock and a supply chain that’s harder to predict.
Understanding the role of HS tariff codes
So, how do governments decide what gets taxed and by how much? That’s where HS tariff codes come in. These are standardised numbers assigned to every type of product – like a global ID for trade. They tell customs authorities what your goods are, where they’re from, and what tariffs should apply. Getting them right is crucial, because a mix-up can mean overpaying duties or facing delays at the border.
Tip: Read more about HS tariff codes in our article here.
And what about de minimis?
One policy that’s helped eCommerce retailers? The US de minimis exemption. It’s let shipments under $800 enter duty-free, ideal for those shipping low-cost items at scale.
This loophole helped surge Chinese businesses like Temu and Shein in the US, but that’s set to change. When the exemption ends, those parcels will face tariffs, pushing up costs for businesses built on lean, fast fulfillment.
Here’s an overview of the before and after of this change:
- Before (Pre-May 2, 2025): A $30 shirt from China shipped to the US cost $35 ($30 shirt + $5 shipping), qualifying for the $800 de minimis exemption with no duties or fees.
- After (Post-May 2, 2025): With the de minimis rule ended for China and a 20% tariff applied, the same shirt now costs $50.95 ($30 shirt + $5 shipping + $10.95 duties + $5 processing) or $60 via postal entry ($25 flat duty), rising to $85 after June 1, 2025.
As of now, the de minimis exemption has only been removed for goods from China and Hong Kong (effective May 2 this year), meaning all shipments from those origins, regardless of value, are subject to tariffs and formal customs entry. For other countries, like Australia and the UK, the situation is trending toward broader restrictions.
Regardless, it’s time to plan ahead. Tariff shifts can hit margins hard, but knowing what’s coming means you can adjust and keep things moving.
Tariffs and US retailers: Higher prices, tighter margins, and a shifting supply chain
Tariffs aren’t just about policy; they’re hitting retailers where it hurts: the cost of goods.
If you import from China or other tariff-affected markets, you’ve likely seen your landed costs go up. That puts pressure on pricing, squeezes margins, and forces tough calls, like potentially dropping product lines or passing costs to customers. Categories like electronics, home goods and apparel are feeling it most.
And it’s not just finished products. Components and raw materials are getting more expensive too, especially when alternatives are limited. That’s pushing up production costs and adding complexity to already tricky fulfillment processes.
Even if your direct suppliers aren’t in tariff-affected countries, you’re not off the hook. Global manufacturers are passing on their own tariff costs, and that trickles down.
For retailers, that means the real challenge isn’t just absorbing cost, it’s deciding how to respond. Do you renegotiate with suppliers? Shift sourcing? Raise prices and risk churn? There’s no one-size-fits-all playbook – but ignoring it isn’t an option.
Tariff FAQs
Who pays tariffs?
US retailers, as the importers, pay tariffs directly to the government. While the cost originates with the retailer, it’s often passed on to consumers through higher prices or absorbed, squeezing profit margins.
How do tariffs affect US retailers?
Tariffs, especially China tariffs, raise the cost of goods from key suppliers. Retailers face tighter margins, potential price hikes for customers, and the challenge of rethinking sourcing – particularly under Trump’s 2025 policies.
What are the current tariffs on China?
As of April 2025, tariffs on Chinese goods include a baseline 20% rate, with an additional 34% reciprocal tariff announced by the Trump administration, totaling 54% on many products. These apply to major retail categories like toys, footwear, and tech.
What are Trump China tariffs?
Trump China tariffs refer to import taxes imposed during Donald Trump’s presidencies. In his first term (2017–2021), he targeted $380 billion in Chinese goods; in 2025, he’s escalated this with broader, higher rates to protect US industries.
What the experts are saying
Insights from leading business experts reveal the complex impact of tariffs on retailers, global trade and economic growth.
Tariffs on the import of foreign goods, including from China, Mexico, and Canada, could over time make manufacturing in the US more economic than importing goods from abroad.
Tariffs can squeeze your margins, but they also reveal who’s adaptable. Watch your costs, know your origins, and shift lanes fast – staying nimble is how you turn a trade barrier into a sales edge.
As with any challenge, small businesses need to be creative about how they respond to tariffs. Looking for alternative suppliers, both domestically and internationally, can offer improved pricing once tariffs are factored in. It makes particular sense to explore suppliers in tariff-free or lower-tariff countries.
Tariffs are a stress test for supply chains. The sharpest retailers will see past the price tags – hunting down tariff-light regions, optimising last-mile delivery, or building resilience locally. They’re not focused on the barrier; but outmanoeuvring the pack.
Tariffs on the import of foreign goods, including from China, Mexico, and Canada, could over time make manufacturing in the US more economic than importing goods from abroad.
Tariffs can squeeze your margins, but they also reveal who’s adaptable. Watch your costs, know your origins, and shift lanes fast – staying nimble is how you turn a trade barrier into a sales edge.
As with any challenge, small businesses need to be creative about how they respond to tariffs. Looking for alternative suppliers, both domestically and internationally, can offer improved pricing once tariffs are factored in. It makes particular sense to explore suppliers in tariff-free or lower-tariff countries.
Tariffs are a stress test for supply chains. The sharpest retailers will see past the price tags – hunting down tariff-light regions, optimising last-mile delivery, or building resilience locally. They’re not focused on the barrier; but outmanoeuvring the pack.
What can businesses do about tariffs?
Here’s how to stay ahead as tariffs shift.
Tariffs aren’t just policy changes – they impact your bottom line. Higher import costs and tougher exports mean it’s time to get smarter about how you manage shipping, suppliers and landed costs.
Here’s what you can do right now.
Get a handle on total costs
Tariffs, duties and fees can sneak up and eat into margins. Tools like Global-e can help you calculate true landed costs – so there are no surprises.
Be prepared to diversify supply chains
If you’re shipping into the US, explore options beyond tariff-impacted countries like China. Sourcing from countries with lower or no tariffs could keep costs down.
Where feasible, direct fulfilment from your origin country might make sense too, cutting out middlemen and tariffed regions. Or, take it a step further: setting up US-based warehousing or fulfilment could mean avoiding import duties altogether and speeding up delivery. Even shifting to US-based suppliers might reduce exposure if the numbers work.
Stay flexible with your carriers
New rules may mean new suppliers or markets. Use multi-carrier tools like Starshipit to compare shipping costs from your different integrated carriers and easily switch carriers if required.
Make sure your data’s right
Tariff rates depend on the country of origin and the product’s HS tariff code – standardised IDs that tell customs what you’re shipping. Get either wrong, and you could overpay or get fined.
Starshipit can pull COO and HS codes straight from your platform – or let you add them manually via the Product Catalogue – automatically ensuring customs gets the right info before your shipment arrives.
Tip: Read more about HS codes in our blog, and learn more about the Product Catalogue.
Stay in the loop
Above all, keep up to date on tariff changes. This is the best way to mitigate any uncertainty and, potentially, seize opportunities when they pop up.
Take control of your shipping today
Tariffs can change quickly, but you can stay ahead. Starshipit provides smart shipping with multi-carrier flexibility, plus tools to manage COO and HS codes effectively.
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Dive deeper into the world of tariffs with our curated collection of insights, featuring expert blogs from Starshipit, partner content, and more:
- From Katana MRP: Guide to Managing Tariffs for SMBs
- Starshipit: Your ultimate guide to HS tariff codes
- Starshipit: Learn about the Product Catalogue feature
David Renwick
David is Starshipit's Product Marketing Lead. When he's not whipping up a fresh new product update or chatting to customers for a new case study, you'll typically find him scoping out coffee spots and talking about what's on at the movies. Connect with him on LinkedIn.
