RIP de minimis 🪦 What Amazon sellers need to do now [MDSR #45]

Hot Off The Presses 📰

We are gathered here today to mourn the May 2nd closure of the de minimis loophole — and of course, unpack the many implications this will have for ecompreneurs. 

Quick disclaimer though. Not even AI can truly predict the impact of these monkey wrenches in global trade. That being said, it’s pretty clear that tariffs aren’t saving American eCommerce apart from one unexpected benefactor: Amazon Haul. 

As for the rest of the world? Following the official tariff announcement, manufacturing activity in China plummeted to a new low. GMV on TikTok Shop fell 21%. Temu and Shein’s ad spending spree has come to an end — and Shein’s London IPO is officially in hot water. 

Now it’s on Amazon sellers to find ways to delay or reduce tariff costs — and resist the suspicious tariff-evasion offers pouring in on social media — as de minimis comes to an end. Even if that means hoarding goods in Canada. 

Just don’t hold your breath for Amazon to display the exact cost of tariff-related price increases alongside all its products. 

As it turns out, raising prices to absorb tariff costs isn’t a viable solution if doing so may or may not trigger Amazon’s algorithm to suppress the Buy Box… But even Amazon Basics seems to have increased some prices. 

Mind you, 65% of Amazon sellers raised their prices in 2024 — and shoppers noticed. Which might be why Amazon is queuing up more sales events and even faster delivery speeds to keep shoppers spending. 

On that front, maybe Amazon’s new AI-powered search bar — which serves up results based on what shoppers actually mean, not just what they type — is coming at the perfect time. Especially for sellers operating in a super niche category. 

Million Dollar Advice 💸 

If you’re one of the many sellers looking to pad your profit margins right now, do yourself a favor: Take a second look at your packaging. 

If you sell a bunch of bundled products or deal with high volumes period, there’s a good chance you’re spending more than you have to on fulfillment and operations due to packaging inefficiencies. 

Take it from Ro — shrink wrapping or revamping your packaging to be even <1” smaller can put that money you’ve left on the table back in your pocket. You’re welcome.

RIP de minimis 🪦 What Amazon sellers need to do now

ICYMI, the U.S. will eliminate the de minimis exemption for shipments from China and Hong Kong effective May 2nd, 2025. This exemption previously allowed imports valued under $800 to enter the U.S. duty-free. The change introduces significant cost implications for Amazon sellers sourcing products from these regions.​

Key Impacts for Amazon Sellers:

⚡️ Increased Import Costs: All shipments from China and Hong Kong, regardless of value, will now be subject to tariffs. For postal shipments under $800, a 120% ad valorem tariff or a flat fee of $100 per item will apply starting May 2, increasing to $200 per item on June 1.

⚡ ️ Competitive Advantage Shift: While platforms like Shein and Temu, which heavily relied on the de minimis exemption, will face significant challenges, Amazon may gain a competitive edge due to its diversified sourcing and fulfillment strategies.

⚡️Potential for Delivery Delays: With the removal of the exemption, U.S. Customs and Border Protection will need to process a higher volume of shipments, potentially leading to delays in delivery times.

Actionable Steps for Sellers:

☑️ Reevaluate Supply Chains: Consider sourcing products from countries still benefiting from the de minimis exemption or domestic suppliers to mitigate increased costs.​

☑️ Adjust Pricing Strategies: Review and adjust product pricing to account for the new tariffs, ensuring profitability while remaining competitive.​

☑️ Communicate with Customers: Inform customers about potential price changes and delivery delays to manage expectations and maintain trust.

Staying informed and proactive is crucial in navigating these changes. For a more in-depth analysis, you can watch the following video:​

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Did you see that post 📲

So many vessels… Just sitting there… ☠️

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Until next time ✌️

As always, thanks for sticking with us until the end. 

If you’d care to share your thoughts on this newsletter, we’re all ears. Just hit reply to sound off. 

See you next time with more of the latest and greatest content you need to succeed this year 🔥

Sincerely, 

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*To qualify, you must be a full-time seller or brand owner and do at least 1 million in verified annual revenue. Will Amazon’s Returnless Resolutions solve the returns debacle? [MDSR #30]