Wang Xin, the head of the Shenzhen Cross-Border E-Commerce Association, points out that the rising tariffs are not just a tax issue but will disrupt the entire business structure. Xin stated, "It will be difficult to operate in the U.S. market," also noting that customs delays and rising logistics costs are contributing to the growing problem. Shenzhen is home to about half of Amazon's Chinese sellers, with over 100,000 sellers in the city generating annual revenues of $35.3 billion. Additionally, major e-commerce platforms like Shein and Temu also have their manufacturing bases in China.
While many sellers plan to raise prices, others are looking for new markets. Dave Fong mentioned that he has increased prices by up to 30% in the U.S. and is cutting back on Amazon advertising costs. Brian Miller, on the other hand, intends to stop product production and implement steep price hikes.
This crisis is likely to severely impact China's small enterprises and manufacturers, potentially leading to an increase in unemployment within the country. The likelihood of Chinese manufacturers leaving the U.S. market and shifting production to countries like Vietnam and Mexico is rising.
