E-commerce
October 1, 2026
Are you wondering how the trade war is disrupting supply chains? The announced tariff increases between the United States and China, coupled with political tensions, are pushing many e-commerce brands to completely review their sourcing strategy. For a merchant, the challenge is twofold: preserving margins on private label products and ensuring reliable delivery to customers.
Concretely, these changes are not limited to a simple increase in costs. They force a rethinking of the origin of products, the diversification of suppliers, and sometimes even the relocation of production. Brands that adapt quickly can turn this constraint into a competitive advantage, while others risk seeing their prices rise and their delivery times lengthen.
So, how is the trade war disrupting supply chains? On the agenda:
Why are e-commerce brands particularly exposed to customs duties?
What are the announced tariff increases that worry importers?
How are brand managers reacting in concrete terms to the uncertainty?
What are the alternatives to Chinese sourcing to diversify your supplies?
How does Qstomy help secure your operations despite the disruptions?
Let's get started.
Summary
Why are e-commerce brands particularly exposed to customs duties?
Own-brand products and direct-to-consumer offers often represent a merchant's highest margins. By cutting out the middleman, these products can sometimes double profitability compared to third-party brands. A pet food retailer, for example, can make 25 margin points on a premium brand and 55 points on its own version, even if both are made in the same factory with similar recipes.
This reliance on imports makes e-commerce brands vulnerable to fluctuations in trade policies. Every tariff increase directly impacts the cost of goods sold, and thus the margin or the final price. For a Shopify merchant, understanding this exposure is essential to anticipating the impacts on profitability and adjusting their sourcing strategy before costs soar.
Convert over 2,000 customers on average per month with Qstomy.
The world’s 1st Shopify AI dedicated to customer conversion
Empowering 200+ e-commerce merchants
What are the announced tariff increases that are worrying importers?
Several recent measures have put importers on alert. In May 2024, the US administration announced an increase in customs duties on certain strategic Chinese products: steel increased from 7.5% to 25%, semiconductors from 25% to 50% by 2025, and electric vehicles to 100%. These increases target specific sectors but signal a broader trend.
At the same time, proposals for general customs duties of 10% to 20% on all imports, and up to 60% on Chinese products, have been discussed. Tariffs of 25% to 100% on Mexican imports are also under discussion. Finally, a bill aimed at revoking China's permanent normal trade relations status was introduced in November 2024. These combined measures create a climate of major uncertainty for brands that rely on importing.
What is the estimated financial impact on consumers and retailers?
The National Retail Federation estimates that these tariff increases could cost consumers between $46 billion and $78 billion in purchasing power each year. According to Jonathan Gold, the federation's vice president, a customs duty is a tax paid by the U.S. importer, not by the foreign country or the exporter. This tax ultimately ends up in the prices paid by consumers.
For an e-commerce merchant, this means that the additional costs cannot be fully absorbed without impacting competitiveness. Raising prices can drive away customers, while reducing margins weakens the business. This difficult equation explains why brands are actively seeking alternatives to Chinese sourcing, not only to reduce costs but also to stabilize their supply chains.
Will Chinese manufacturers absorb the new tariffs?
Some experts remain optimistic. Jan Kniffen, a retail investment consultant, recalls that during the 2018 tariffs, Chinese manufacturers, eager to access the US market, absorbed some of the costs. He notes that the Chinese economy is in a much more difficult situation today than it was six years ago, which could encourage factories to lower their prices to retain their customers.
However, this assumption is far from guaranteed. Unpredictable trade relations and concerns over supply chain stability are prompting many brands not to take this risk. Relying on suppliers to absorb costs is a passive strategy that exposes the merchant to unpleasant surprises if the situation unfolds differently.
How do brand managers concretely react to uncertainty?
During a November 2024 meeting, a group of private label managers representing 30 brands and hundreds of products sold in 800 stores and 30 e-commerce sites made their desire to move away from China clear. It is not just a question of tariffs, but also of unpredictable relationships, supply chain stability, and the pursuit of better margins.
These managers are exploring manufacturing options in other Asian countries, partnerships in Europe and South America, as well as American suppliers. The group even acquired its first production facility in the United States, taking control of its destiny while improving profitability. This proactive approach illustrates a broader trend toward diversification and nearshoring.
What alternatives to Chinese sourcing can help diversify your supply chain?
Diversifying supply sources has become a strategic priority. Options include other Asian countries such as Vietnam, India, or Bangladesh, which offer competitive production costs. Partnerships in Europe and South America can also reduce delivery times and geopolitical risks.
Working with American or local suppliers offers the advantage of bringing production closer to consumers, thereby reducing shipping costs and lead times. For a Shopify merchant, this diversification requires a rigorous evaluation of new partners: quality, reliability, regulatory compliance, and the ability to meet deadlines. It is an investment of time, but one that protects the business against future shocks.
Why is the nearshoring of production becoming a credible option?
Relocalization, or the repatriation of production, is gaining ground. The previously mentioned management group acquired a US production unit, a decision that allows it to control its supply chain and improve its margins. This approach reduces dependence on imports and fluctuations in trade policies.
For small brands, complete relocalization may seem out of reach. However, partnerships with local manufacturers or co-manufacturers can offer similar benefits without the upfront investment. Bringing production closer to consumers is a trend that is expected to accelerate in the coming years, as industry experts suggest.
How to assess the vulnerability of your current supply chain?
Before modifying your sourcing strategy, it is essential to assess the vulnerability of your current chain. Identify products that rely heavily on a single country or a single supplier. Analyze the potential impact of an increase in customs duties on your margins and prices. Also consider the risks of delivery delays or stock shortages.
This assessment must include the regulatory compliance of your suppliers and their ability to adapt to changes. A supplier who cannot absorb costs or meet deadlines becomes a risk to your business. Document these vulnerabilities and establish an action plan to diversify your sources before a crisis occurs.
What role do unpredictable trade relations play in this decision?
Beyond tariffs, it is the unpredictability of trade relations that is pushing brands to leave China. Sudden policy changes, threats of new taxes, and diplomatic tensions create an unstable environment. For a merchant, this instability translates into difficulties in planning, pricing, and guaranteeing delivery times.
Supply chain stability has become as important a criterion as cost. Brands are looking for reliable partners in countries with more predictable trade relations. This quest for stability partly explains the growing interest in local or regional production, which reduces exposure to geopolitical hazards.
How to anticipate future costs and adjust your pricing strategy?
Anticipating future costs is crucial for maintaining profitability. Follow trade policy announcements and assess their potential impact on your products. Model different scenarios: a 10%, 20%, or 60% increase in customs duties, and determine the impact on your margins. This analysis will allow you to decide whether you need to increase prices, absorb the costs, or change suppliers.
Communication with your customers is also important. If a price increase is inevitable, explain the reasons transparently. Customers are more understanding when they comprehend the causes. A flexible pricing strategy, with progressive adjustments, can help maintain trust while protecting your margins.
How does Qstomy help secure your operations despite disruptions?
Qstomy, the Shopify AI agent, helps merchants maintain a seamless customer experience even when the supply chain is disrupted. Thanks to its package tracking and customer account management features, Qstomy automatically informs your customers of their order status, thereby reducing support inquiries related to delays. This transparency builds trust, even in times of uncertainty.
Qstomy can also help you optimize your cross-selling and upselling, partially offsetting the impact of cost increases on your margins. By guiding customers toward complementary products or alternatives in stock, Qstomy maximizes the average value of each cart. Its customer support assistant, available 24/7, answers frequently asked questions and frees up your team for strategic tasks.
What is the checklist before reviewing your sourcing strategy?
Before modifying your sourcing strategy, follow this checklist for a smooth transition:
Audit: identify the products most exposed to customs duties and their share of your revenue.
Scenarios: model the impact of different tariff increases on your margins and prices.
Suppliers: evaluate the reliability and compliance of your current and potential partners.
Diversification: explore alternatives in other countries or local production.
Communication: prepare a plan to inform your customers of any price or lead time changes.
In brief
The trade war is disrupting supply chains and pushing brands to diversify their sources. Anticipating, evaluating, and adapting are the key words to protect your margins and your reputation.
FAQ
Should I immediately leave my Chinese suppliers? Not necessarily, but evaluate the risks and prepare alternatives to reduce your dependence.
How can Qstomy help during this transition? Qstomy maintains seamless communication with your customers and optimizes your sales to offset cost increases.
To go further: How to integrate Shopify with Amazon for products, stock, and reviews? - Qstomy, How to set up an AI chatbot for perishable products: conservation, delivery, and freshness? - Qstomy, How to use an AI chatbot to sell premium products without being pushy? - Qstomy, Can you sell Amazon products on Shopify? - Qstomy, E-commerce support policy: writing clear rules for customers and agents - Qstomy, What e-commerce marketing strategy without an advertising budget? - Qstomy, E-commerce SEO strategy for category pages - Qstomy.
Enzo
October 1, 2026
