Budget e-commerce giants Shein and Temu are set to increase prices on their platforms from April 25 in response to a crackdown by Trump on low-value imports from China and Hong Kong which are adding significant cost pressures to their operations.
The two Chinese-founded retailers have confirmed the hike in nearly identical customer messages this week.
“Due to recent changes in global trade rules and tariffs, our operating expenses have gone up. To keep offering the products you love without compromising on quality, we will be making price adjustments starting April 25, 2025,” the companies said in statements to customers.
Both Shein and Temu have built massive customer bases in the US and abroad by taking advantage of a long-standing trade loophole known as the “de minimis” rule.
This exemption allowed parcels valued under US$800 (A$1,260) to enter the US duty-free – a crucial part of their low-cost, high-volume business model.
But that model is now under fire. A new executive order signed by Trump will close the loophole effective May 2, meaning imports under that threshold will now be subject to tariffs and duties. The move is part of the Trump administration’s broader push to reduce reliance on Chinese goods and bolster domestic manufacturing.
The fallout is already being felt on the ground. Shein’s so-called ‘Shein villages’ – factory hubs in China’s Guangdong province – are reporting steep order drops as the company begins shifting production to alternative locations like Vietnam.
However, Chinese suppliers warn that Vietnamese factories are slower and less scalable, threatening the lightning-fast turnaround times Shein and Temu are known for.
The pivot to Vietnam may help the companies maintain access to the US market at lower tariff rates, but industry analysts have warned that a shift in supply chains will not come cheap or fast.
For now consumers are being urged to “buy now at today’s rates” before the April 25 hike hits.
