According to the White House, the tariff rate in the US is currently 145%.
Spencer Platt Getty Images News Getty images
While the last news about the President of the United States Donald Trump in the first place Tariffs He led to wild swings on markets and shocked companies around the world, companies that rely on open trade between China and the USA, are among the most susceptible to security Pity.
Ago And Shein are not the only companies that will be disturbed by the trade war between the USA and China. Imports also on many other small and medium -sized companies, such as those involved in dropping.
“At the moment we see a 33% decrease in revenues,” said Kamil Sattar. The 25-year-old runs Dropshipping in online stores that sell items such as outerwear, mobile accessories and many others.
Dropshipping It is a kind of method of implementing electronic trade in which sellers process orders by providing them with suppliers who then send products directly to customers. This often includes buying items from Chinese suppliers or producers and sales to developed markets of the US or other. This ultimately eliminates the need to wear your own sellers.
“You can sell products online, but you don't have to pay for shares until the customer appears in the online store and makes a purchase,” said Sattar.
It is a popular business model among side hustners and entrepreneurs, because it requires small capital and can be built entirely online using platforms such as platforms Shopifyalong with marketing tools, such as paid advertising and creating content.
In the United States it becomes much more difficult, because many products from China are now stopped on the borders for control. So this is not even a loss of more money in terms of profitability. Store the product.
Kamil Sattar
E-commerce entrepreneur
Therefore, the current 145% accumulated tariff In the case of Chinese goods, it exerts pressure on many companies with droplets.
Dropshiping under pressure
Like many others, Sattar's Dropshipping Business most of their products from China – about 90%, most of which concern the American market.
In response to the tariffs, Sattar raised the prices of some of its products that are still sought after in the USA
“We don't sell the USA as much as they used to be … 60% (our products) was sold the USA, and now it has dropped to about 20 to 30%,” said Sattar CNBC Make It. “We are now releasing the US consumption and we focus on the European market.”
We know that if consumer trust is low, then (affects) our sales … it will negatively affect the expiry of the US.
Kamil Sattar
E-commerce entrepreneur
Dead de minimis
Trump's elimination de minimis The dismissal dealt the biggest blow in the Dropshipping industry. This recipe was historically brought by dropshippers and e-commerce retailers.
According to the official, which once was a gap that allowed shipments worth 800 USD or less, will end with goods from China and Hong Kong from May 2 announcement through the White House in April.
In 2024 more than 90% of all packages Entrance to the USA has arrived through de minimis or around 4 million shipments On average every day.
However, these goods will now “be subject to a mandatory rate of 30% of their value or USD 25 per item (increase to USD 50 for its position after June 1, 2025”), according to statement through the White House.
You will see large nasal divers of all Amazon (i) Shopify sellers … Many micro entrepreneurs with one source of delivery, one source of customer, will have deep trouble.
Yinglan Tan
Founder managing partner, Insignia Ventures Partners
The de minimis dismissal was temporarily suspended In February, which led to serious delays in shipping goods to the USA, because over a million packages gathered in American ports. A few days later, President Trump reversed the course and delayed Elimination of the rule until May 2.
“In the United States it becomes much more difficult, because many products from China are now detained on the borders to control. So this is not even a loss of more money in terms of profitability. Also get the product,” said Sattar.
“This is a serious part that people are not aware of … If your package got stuck on the border, your client will want to return. For some time we are dealing, so we do not want to sell (some) our Chinese products in the US,” added Sattar. “Profit margins have been reduced by this.”
In China, the influence of US tariffs also caused turbulence.
“We see that our small and medium -sized enterprises have been seriously injured in the cross -border electronic trade sector, especially some general products or low -added products, which currently have great difficulties in export”, on Thursday Xin Wang, on Thursday, the head of CNB Cannbc. Mandarin -speaking response.
“We conducted several surveys for about 228 companies and we found that very few of these companies are currently optimistic; everyone is very pessimistic,” Wang said. “60 to 70% of companies adopt an attitude of waiting, and some companies actively develop markets in other countries.”
Meanwhile, in the case of newly sent goods, tariff fees added will be transferred to American consumers, Wang added.
Is Dropshipping still profitable?
Industry experts agree that having a different set of markets for supplies and sales is crucial in navigation in the current commercial environment.
“I would say that especially if someone sends from China to us … and among all of them, small packages-as a business model of the shein type or this (gets) most, probably to the extent to which they simply can no longer conduct their business,” said Julia Xu, co-founder and general director of Wayo.
“You will see the great load -bearing divers of all Amazon (I) Shopify sellers … Many of the micro entrepreneurs with one source of delivery, one source of customer, will have deep trouble,” said Yinglan Tan, managing founder at Insignia Ventures Partners.
He added that Dropshippers, who diversify outside the USA and China, will be able to survive, added Sattar.
“At the moment it is very difficult to develop a real plan until everything calms down (because) things change every day,” said Sattar. “Those who hold on and are smart, earn the most money because they will see hidden possibilities … and these possibilities – do not come too often.”
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