Photo by Adrian Sulyok on Unsplash
Temu and SHEIN have established themselves as leaders in the ultra-low-cost online retail business, while upstart Amazon Haul has so far struggled to break the stranglehold that these entities — in tandem with TikTok Shop — have on the existing market.
But all of that could change in the near future, as Forbes contributor Kiri Masters detailed. With the de minimis exemption set to expire on May 2 as part of President Donald Trump's trade policy changes, and coinciding with the aggressive tariffs placed on Chinese imports, Temu and SHEIN face substantial headwinds should that eventuality materialize.
"The Trump administration's decision to end the de minimis exemption has sent shockwaves through the ultra-low-price shopping ecosystem. Starting May 2, packages from China valued at or under $800 shipped through the U.S. Postal Service will face a tariff equivalent to 120% of the goods' value or a fee of $100 per package, increasing to $200 in June. Items shipped through carriers like UPS will face tariffs as high as 145% of the goods' value," Masters wrote.
Amazon (and by Extension, Amazon Haul) May Have a Leg Up on Temu, SHEIN Due to Established Fulfillment Practices
While Temu and SHEIN have both enjoyed significant year-over-year sales growth in late March and early April, results that analysts suggest are due to consumers looking to beat the imminent price increases announced by both retailers, that window appears to be closing.
When it does, Amazon Haul could have a substantial advantage in the ultra-low-cost retail space as the de minimis loophole slams shut and increased tariffs take hold. Unlike Temu and SHEIN, Amazon has pre-existing (and massive) stateside warehousing, packing, and distribution capabilities — whereas the former pair rely largely on direct-to-consumer shipments that must individually clear U.S. customs.
"This distinction could prove critical in navigating the new tariff reality. While the specific implementation details remain unclear, Amazon’s domestic fulfillment network potentially shields Haul from the most severe impacts of the de minimis policy changes," Masters suggested.
"Products that have already been imported in bulk and stored in Amazon’s U.S. warehouses may face different, or at least more certain, tariff treatment than direct-to-consumer shipments where tariffs are calculated on an individual basis by U.S. Customs and Border Protection," she added.
The success of the Fulfilled by Amazon (FBA) system could potentially unlock Amazon Haul's potential, should Chinese retailers seeking to appeal to cash-strapped U.S. customers be hampered by protectionist trade policy.
Caveat: Trump's On-Again, Off-Again Tariffs Concerning China Could Be Subject to Renegotiation
There's one major "what if?" trailing this line of thinking, however: It appears that both the Trump administration and Chinese officials are signaling a return to the bargaining table.
According to an April 23 report from The Globe and Mail, representatives from both nations appear interested in some form of de-escalation of current trade tensions.
On April 22, U.S. Treasury Secretary Scott Bessent hinted at some form of economic rapprochement in the "very near future,” saying “neither side thinks the status quo is sustainable," to an audience at a private investment conference in Washington. Trump was quick to reinforce Bessent's remarks when asked about them later that day, suggesting that the current rate of Chinese tariffs would "come down substantially."
The following day, Chinese Foreign Ministry spokesman Guo Jiakun also appeared to offer something of an olive branch.
"There are no winners in a tariff war or a trade war,” Guo said.
“China’s attitude is very clear. We do not want to fight, but nor are we afraid to. If forced to fight, we will do so to the end. When it comes to talks, our door is wide open,” he added.
Bessent went on to suggest that although negotiations with Beijing could be difficult, a de-escalation was likely. Trump differed in his follow-up comments only inasmuch as he thought a deal could be struck "pretty quickly," adding that he would not "play hardball" at the bargaining table.