Feature Illustration image by Abubacar Keita
Thinking of buying that t-shirt from Shein? Think twice, as tariffs on China may impact the price.
Nearly 65% of clothing is manufactured in China. Taking into account President Trump’s tariffs on China means that there will be challenges for not just the United States, but also for an industry that is a major player in the apparel manufacturing industry.
A tariff is a tax charged on goods bought from other countries and is typically a percentage of a product’s value. The president’s motivation for imposing these tariffs is to boost American manufacturing and generate jobs, but as it so happens, the implications of this executive order are throwing the fashion industry and its consumers for a loop. Now, economists expect spiked prices on goods ranging from clothes, coffee, alcohol and even electronics.
The United States more than doubled the cost of importing Chinese-made goods, with the tariffs reaching as high as 145% in the last week. In response, China created a whopping 125% tariff on American goods. Amid this trade war, it is clear that neither side is backing down anytime soon.
Starting May 2, companies that ship directly from China to their US consumers will not have “de minimis,” the loophole that allows them to ship packages duty-free if they have a value under $800. No de minimis means that US consumers will have to absorb these tariff costs by paying higher prices on their everyday fashion purchases.
With this issue in mind, fashion companies are actively looking for solutions to reduce dependency on China and avoid its heavy tariffs. One of these solutions includes companies moving their production out of China and into other countries with less harsh tariffs, such as Vietnam, Turkey and Italy, which have only experienced a 10% tariff increase.
The fashion industry is expected to take a big hit in this trade war, as more than half of the world’s clothing is manufactured in China for its inexpensive labor costs and ability to scale quantities with its state-of-the-art equipment. In any case, the fashion industry and the billions of lives that it touches are rooted in the business of trade.
From gathering raw materials from suppliers, employing factories to manufacture your favorite designs, paying duties to come to a final sample that is in line with the brand image and reaching the final consumer. Even just operating as a direct-to-consumer business, the fashion industry has layers that rely on each other to create a product that will be bought and used as long as the supply chain can sustain its production.
The billions of lives that are impacted in the making and buying of fashion are no frivolous matter. Making sure that companies and industries can sustain the costs can mean the difference between laborers and executives being employed, businesses generating enough revenue and consumers being able to afford a new first-day-of-school outfit, just to name a few.
In light of these issues, as global trade will inevitably fall due to the likes of spiked tariffs, fashion companies will be forced to re-navigate their supply chains in terms of planning, sourcing, quality assurance and pricing as they aim to make the most profit without sacrificing quality and affordability.
In response to these issues, as consumers of fashion, we can mitigate the impact of these tariffs by focusing on sustainable consumption practices and supporting businesses that prioritize ethical sourcing and manufacturing. This includes buying less, buying secondhand and choosing quality, durable garments over fast fashion.
You can also look for opportunities to buy local or support businesses with a flexible supply chain. As these tariffs brew changes in consumer dynamics and behavior, international relations, and business transactions, time will only tell how tariffs will be handled in this capitalist nation under the Trump administration.
