How to Navigate the Impact of U.S. Tariffs on Amazon Sellers 

The global trade landscape is shifting again, and Amazon sellers are feeling the pressure. With new rounds of U.S. tariffs imposed or proposed on imported goods (especially from China and other key manufacturing regions), online sellers must reassess their sourcing strategies, pricing models, and revenue plans.

In this blog post, we’ll explore how U.S. tariffs are impacting third party sellers, how to mitigate risks, and more importantly, how to turn this disruption into an opportunity to diversify, globalize, and strengthen your business.

Understanding the Impact of U.S. Tariffs on Amazon Sellers

What Are Tariffs?

Tariffs are taxes imposed on imported goods, designed to make foreign products more expensive and encourage domestic consumption. In theory, collecting tariffs helps protect local industries. In practice, it often means higher costs for sellers who rely on overseas manufacturing, especially Chinese imports.

How Tariffs Affect Amazon Sellers

For Amazon sellers, tariffs have a direct impact, particularly those in private label, wholesale, or arbitrage models.

• Increased Cost of Goods Sold (COGS): Tariffs can raise your import costs by 10–25%, slashing your profit.
• Inventory Planning Disruptions: Tariff changes often occur with little notice, making it difficult to forecast demand and costs.
• Competitive Pressures: Sellers who source from low-tariff regions or domestic suppliers may undercut your prices.
• Supply Chain Bottlenecks: Customs delays, reclassification of goods, and tighter import regulations add complexity.

For many sellers, tariffs can be the difference between profitability and loss, unless you act proactively.

9 Strategies to Survive and Thrive Under U.S. Tariffs

1. Diversify Your Supply Chain

One of the smartest moves any Amazon seller can make today is to reduce dependence on a single country, especially China.

Tips to diversify sourcing:

• Explore alternative regions: India, Mexico, Turkey, Vietnam, and even Eastern Europe are growing as manufacturing hubs with competitive pricing.
• Work with sourcing agents: Hire professionals who can find trusted suppliers outside China and vet production capabilities.
• Use trade shows and sourcing platforms: Platforms like Alibaba now include suppliers from around the world. Consider regional expos like India Sourcing Fair or Mexico Connect.

Pro tip: Some sellers reduce tariffs by performing “light assembly” in a neutral country, such as importing parts to Vietnam or Mexico, assembling the final product there, then shipping to the U.S.

2. Renegotiate with Suppliers

If moving to a new supplier isn't viable in the short term, try to renegotiate pricing or terms with your current manufacturers.

Ask for:

• Volume discounts
• Shared tariff burden (some suppliers will absorb part of the cost)
• Extended payment terms
• Bundled shipping discounts

Suppliers are also under pressure due to reduced order volumes and will often be more flexible than you may expect.

3. Expand to International Amazon Marketplaces

If U.S. tariffs are eroding your margins, consider expanding to other countries where your goods may not face the same import duties—or where competition is less intense.

Top Amazon marketplaces to consider:

• Canada & Mexico: Easy entry for U.S. based FBA sellers via the North America Remote Fulfillment (NARF) program.
• European Union: Amazon UK, Germany, France, Italy, and Spain offer strong Amazon sales potential. Be mindful of VAT and compliance regulations.
• Australia, Japan, and UAE: Smaller but growing markets with less saturated niches.

Tips for international expansion:

• Use Amazon’s Global Selling resources to simplify registration and tax compliance.
• Start with one marketplace and build gradually.
• Consider third-party fulfillment centers to reduce shipping times and local taxes.

4. Develop Domestic or Hybrid Manufacturing

Domestic manufacturing may come at a premium, especially compared to Chinese manufacturing, but it eliminates tariffs and provides supply chain stability.

What to consider:

• Start small: Test the U.S. market with a limited batch made domestically to evaluate cost-effectiveness.
• Use U.S.-based assembly: Import components and perform final assembly stateside to avoid full tariffs.
• Partner with small U.S. manufacturers: Many are open to low MOQs (Minimum Order Quantities) and can offer faster turnaround.

This also helps with branding and marketing. “Made in USA” still carries strong value, especially in certain categories (e.g., tools, apparel, health products).

5. Reprice Your Products Intelligently

It’s completely understandable that many sellers are hesitant to raise prices right now. It feels risky—and no one wants to drive away loyal customers. But here’s the reality: if your costs have increased and you’re not adjusting your prices accordingly, you’re cutting into your own profits.

Things to consider:

• You’re not alone. Third party sellers across the board are feeling the same pressure from tariff rates, and today’s consumers are more aware than ever.
• Most consumers understand that rising costs from inflation, supply chain disruptions, and higher tariffs are pushing prices up and causing price hikes globally.
• A well-reasoned, transparent price change likely won’t catch shoppers off guard.
• Strategic repricing is more critical now than ever.

Pro tip: Use Aura, an automated Amazon repricer that adapts to market changes fast while following your minimum and maximum prices. Aura makes it easy to set prices that protect your margins. When your data is clear and organized in one place, confident pricing decisions come naturally.

6. Know Your New Landed Costs

If you’re not accurately calculating your full landed cost, with the new costs associated with tariffs, you’re essentially operating in the dark. Failing to properly account for your new landed costs - down to the penny - can mean you’re unknowingly selling at a loss.

Your landed cost should include:

• Product cost
• Freight and shipping
• Duties and customs fees
• New tariffs and existing tariffs
• Taxes
• Insurance and handling fees
• Any other expense tied to getting your product into inventory

This total reflects the real cost of getting your product into your fulfillment center or warehouse.

7. Optimize Product Portfolio and Packaging

With tariffs raising costs, it’s crucial to analyze your inventory mix and optimize for profitability.

Audit your product line:

• Cut underperforming SKUs with thin margins or high shipping charges/tariff costs.
• Increase focus on high-margin or tariff-exempt items.
• Use third-party Amazon data and sourcing tools to find low-competition, low-duty niches.

Packaging optimization tips:

• Reduce size and weight to lower costs on shipping and FBA fees.
• Consider switching to more compact designs or collapsible formats to reduce costs.
• Use dual-purpose packaging for international compliance and branding.

Every ounce and inch counts when tariffs, FBA costs and shipping rates are rising.

8. Diversify Revenue Streams Beyond Amazon

Relying entirely on Amazon leaves your business vulnerable—not just to tariffs, but to algorithm changes, policy suspensions, and platform fees.

Build alternative revenue channels:

• Shopify store or WooCommerce: Own your audience and data while controlling pricing.
• Wholesale/B2B sales: Sell to retailers or corporate buyers who purchase in volume.
• Social commerce: Use Instagram, TikTok, and Pinterest to drive DTC (direct-to-consumer) sales.
• Subscription models: Offer replenishable items via monthly boxes or recurring delivery options.

Don’t wait for your Amazon account to face trouble. Start building external channels now.

9. Hedge Against Future Risks

Tariffs may be today’s concern, but geopolitical risk, supply chain disruptions, and regulatory shifts will always be part of the game.

Future-proof your business by:

• Staying informed: Follow trade news, USTR announcements, and Amazon seller updates.
• Stocking critical inventory: If you anticipate tariffs rising, front-load inventory to lock in lower costs.
• Automating and streamlining operations: Use AI tools and software to reduce labor costs and improve forecasting.
• Creating contingency plans: If your top-selling product were suddenly hit with a 25% tariff tomorrow, what would you do?

Smart sellers treat uncertainty as a trigger to innovate—not to panic.

Final Thoughts: Turn Tariffs Into Opportunity

Yes, tariffs create hurdles. But, they also weed out complacent sellers, making space for the agile, informed, and strategic entrepreneurs to rise.

Here’s a quick recap of how to not just survive, but thrive:

• Diversify sourcing beyond China.
• Renegotiate pricing and terms with suppliers.
• Explore international Amazon marketplaces.
• Consider domestic or hybrid production models.
• Optimize your product mix and packaging.
• Build multiple revenue streams beyond Amazon.
• Hedge against future risks with proactive planning.

Change is coming—but so is opportunity.

The Amazon sellers who adapt quickly and invest in resilience will emerge stronger, leaner, and more competitive in both domestic and global markets.

Now is the time to rethink your strategy, diversify your risk, and unlock new growth in a post-tariff e-commerce era.

Want Help Building a Tariff-Proof Amazon Business?

If you’re serious about future-proofing your business, consider working with sourcing experts, expanding to global marketplaces, or consulting with FBA optimization professionals. You don’t have to navigate this alone. Tap into networks, masterminds, and mentors who’ve been through it.

Tariffs may be out of your control, but how you respond? That’s entirely in your hands.

FAQs: Amazon Sellers and Tariffs

What exactly is a tariff?

A tariff is a government-imposed tax or duty on imported goods. It increases the cost of bringing products into a country, which affects your landed costs and profitability. China tariffs impact many Amazon sellers who use Chinese suppliers and Chinese manufacturing facilities, and import their products to the U.S.

Which sellers are impacted by tariffs most?

U.S.-based sellers importing products from China (to stock in FBA warehouses or their own facilities) are directly impacted by U.S. tariffs on Chinese goods. They must pay additional duties and tariffs when the shipment goes through the U.S. Customs clearance process — adding to their landed costs and affecting pricing and profit margins.

What is the De Minimis Rule?

This rule sets a minimum value threshold below which imported goods can enter a country without being subject to duties and taxes. In simple terms, if your imported shipment is valued under a certain amount, it can clear customs duty-free and tax-free. For example, China-based sellers who ship individual orders directly to U.S. customers usually sidestep tariffs on low-value shipments because of the $800 de minimis rule. However, the de minimis rule has effectively ended for Chinese imports and will be fully phased out for all countries by July 1, 2027.

Do tariffs apply to all products I import for my Amazon store?

Not necessarily. Tariffs are often applied based on the product’s HS (Harmonized System) code and country of origin. Some goods might be exempt, while others carry higher duties.

How do I find out if my product is subject to tariffs?

You can check the U.S. Harmonized Tariff Schedule (HTS codes) or consult with your customs broker or freight forwarder. They can help classify your product and determine applicable customs duties and tariffs.

Who is responsible for paying tariffs — the supplier or the Amazon seller?

In most cases, the importer of record (usually the Amazon seller) is responsible for tariffs when goods enter the destination country. Clarify this in your supplier agreements.

How can I track and forecast the impact of tariffs on my Amazon business?

Use financial and inventory management tools that factor in landed costs and tariff expenses, such as ConnectBooks. Regularly review your profit margins, pricing strategy, and sourcing options.

Can I pass tariff costs onto my customers and charge higher prices?

Yes. Many third party sellers raise retail prices to offset tariff expenses. However, it’s important to balance price adjustments carefully to stay competitive on Amazon.

How often do tariff rates change?

Tariff rates can change due to trading partner negotiations, international disputes, or new trade agreements. It’s a good idea to monitor government announcements or stay in touch with a trade compliance specialist.

What happens if I under-declare or misclassify my product to avoid higher tariffs?

This is considered customs fraud and can lead to heavy fines, penalties, and the seizure of your goods. It’s essential to classify products accurately and comply with customs regulations.

What are reciprocal tariffs?

Reciprocal tariffs are tariffs that a country imposes on imports from another country in response to that country’s tariffs on its own exports. In other words, it’s a way for one country to “mirror” or match the trade barriers set by another country to level the playing field in international trade.

Is it possible to avoid tariffs altogether?

In some cases, yes — by:

• Sourcing from other countries not subject to tariffs
• Applying for tariff exclusions (if available)
• Shipping via alternative fulfillment methods like dropshipping from non-affected regions