Trump’s Tariffs Hit Fast Fashion: What’s Next for Shein and Temu

A Tariff Wake-Up Call for Fast Fashion

Shein and Temu, two of the most dominant fast fashion platforms in the U.S., are warning that prices will soon rise. The reason? A wave of new tariffs that could upend their entire business model.

On April 2, 2025, President Trump signed an executive order ending the de minimis exemption for shipments under $800 and imposing new tariffs of up to 145% on imports from China and Hong Kong. Beginning May 2, these low-value shipments will no longer enter the U.S. duty-free. Platforms like Shein and Temu, which have built their business models around direct-to-consumer shipping under this exemption, will now face tariffs starting at 30% per item—significantly raising their operating costs and threatening their ultra-low pricing strategy.

The End of the De Minimis Advantage

The de minimis rule previously allowed individual shipments under $800 to enter the U.S. without duties or heavy customs scrutiny. In 2023, more than 1.4 billion packages entered the U.S. under this exemption, up from 140 million in 2013, according to Laufer Group International. A huge portion came from Shein, Temu, and similar platforms.

Now, this exemption is being phased out. As of May 2, these packages will face a 30% tariff or $25 per item, rising to $50 per item on June 1. With China retaliating and Trump responding by tripling tariffs to 90% or $75 per item, costs are quickly ballooning.

Shein and Temu Brace for Impact

Both companies have confirmed that customers will soon feel the impact. According to Bloomberg, in nearly identical statements, Shein and Temu announced they will raise prices starting April 25 due to "increased operating expenses." As a result, many shoppers are scrambling to place orders before the changes go into effect.

Will Fast Fashion Lose Its Edge?

The platforms’ success in the U.S. was built largely on the de minimis loophole. Without it, their cost advantage shrinks substantially. According to BBC News, nearly two-thirds of the 1.4 billion de minimis packages shipped to the U.S. in 2023 came from China and Hong Kong.

While larger competitors like Amazon may benefit, smaller fashion players could also gain ground if Shein and Temu struggle to maintain their razor-thin pricing strategies.

What Shein and Temu May Do Next

Temu and Shein operate on razor-thin margins, driven by scale, speed, and direct shipping from China. Without the de minimis exemption, their competitive advantage shrinks. Many analysts believe that:

Their ultra-low prices may no longer be sustainable

Fulfillment operations may need to shift to domestic warehousing

Diversifying into markets like Europe or Australia (which still offer de minimis exemptions) may become a focus

Opportunities for Resale and Sustainability

While ultra-fast fashion may slow down, other sectors could benefit. Platforms like ThredUp and The RealReal are positioning resale as a more viable and sustainable alternative, especially as new fashion becomes more expensive. ThredUp applauded the end of the de minimis loophole, calling it a step toward leveling the playing field.

What About TikTok Shop?

TikTok Shop is also expected to feel the impact. The platform has quickly grown as a competitor in the low-cost e-commerce space, often relying on the same direct-from-China shipping model. As tariffs rise and the de minimis rule disappears, TikTok sellers may face similar cost increases, slower delivery times, and higher scrutiny at customs.

How 3PL Center Helps Brands Adjust

For fashion brands navigating these changes, 3PL Center provides infrastructure and expertise to build more resilient logistics:

Warehouse locations near key U.S. ports to reduce customs delays

Support for high SKU count apparel fulfillment with size runs and seasonal variations

LTL and container solutions to manage bulk or replenishment shipments

Real-time inventory tracking and WMS tools to improve forecasting and speed

Rate shopping by speed, cost, and carrier to reduce shipping expenses

Whether you're an emerging DTC brand or an established retailer, 3PL Center helps you adapt to the shifting global trade environment.

Final Thoughts: The Fast Fashion Crossroads

The end of the de minimis rule marks a turning point for cross-border eCommerce. Shein and Temu may still survive—but not without major changes to pricing, operations, and logistics. In the meantime, U.S. consumers and retailers will feel the impact.

Need help building a more resilient, cost-effective ecommerce fulfillment strategy? Reach out to 3PL Center to learn how we support fashion brands in the new tariff era.