The United States has increased trade tariffs, and Chinese cross-border e-commerce is turning to the "second market".

On April 8, The Science and Technology Innovation Board Daily reported (Reporter Xu Cihao) that on April 2 local time, the White House stated that Trump would impose a 10% "Benchmark Tariff" on all countries, which will take effect on April 5, Eastern Time. In addition, the country with the largest trade deficit with the United States will also face a higher personalized "Counter Tariff," which will officially take effect on April 9, Eastern Time.

Among the more personalized "reciprocal tariffs" list, China is included. It is reported that the US will impose a 34% reciprocal tariff on China, while Trump had previously announced a cumulative 20% tariff increase on China, bringing the total tariffs imposed on China this year to 54%.

At the same time, the "800 USD duty-free package treatment" enjoyed by goods from mainland China and Hong Kong will officially end on May 2. For overseas sellers, the era of small duty-free bonuses has also officially come to an end.

In the face of uncertainty, foreign trade professionals in China and globally are under certain pressure, but several practitioners from foreign trade and cross-border big brands stated in interviews with the "Science and Technology Innovation Board Daily" that they are looking for a "second market."

Cross-border e-commerce chooses "Second Market"

Shenzhen cross-border seller Xu Xiaoyong told a reporter from the Science and Technology Innovation Board Daily that he is currently operating 4 categories mainly on TikTok, Temu, and Walmart in the US and Europe. Currently, the category of fitness equipment priced over $80 has not been affected by tariffs, and the order volume remains stable.

"However, it has an impact on the categories priced between $30 and $50." Xu Xiaoyong told the reporter from the Science and Technology Innovation Board Daily. With the implementation of tariffs in the United States, to ensure profits, products can only be priced higher. After the price increase, it was found that the sales volume that was over 3,000 orders in the previous month has now dropped by about 20% in just one week.

Xu Xiaoyong has been continuously communicating with various cross-border takeaway companies. According to his understanding, different countries have different strategies in response to a series of tariff measures from the United States. Taking Vietnam as an example, it will discuss the possibility of zero tariffs with the United States. Next, he plans to use Guangxi to produce and then export to the United States through re-exporting to Vietnam.

The reporter from the Science and Technology Innovation Board Daily noticed that Trump's tariff policy not only affects sellers going overseas from the United States but also impacts freight forwarders.

Yu Haitao, the business manager of Shanghai Shuo Yu International Freight Forwarding Co., Ltd., told a reporter from the "Science and Technology Innovation Board Daily" that the current cargo must be shipped out before April 9, and they are currently hesitant to accept new cargo after April 9.

"After April 9th, there is too much uncertainty for the goods shipped. If, upon arrival at the port, an additional 50% tax is indeed imposed, the customer might very likely abandon the goods," Yu Haitao told a reporter from the "Science and Technology Innovation Board Daily." He noted that after the U.S. tariffs were announced, orders for shipments to the U.S. significantly decreased, while clients from Africa, Latin America, the Middle East, and Europe slightly increased. "There are also some customers who want to ship after April 9th; generally, we advise them to consult other freight forwarders."

The founder of Youzi Chuhai, Ji Lei, stated in an interview with the "Science and Technology Innovation Board Daily" that, as he understands, many Chinese merchants will choose the Mexican market as a springboard to connect with the U.S. market, given the unstable situation of e-commerce in the United States.

"This option presents certain opportunities, but a series of difficulties need to be overcome. It is recommended to prioritize entering offline." Ji Lei told the reporter from the "Science and Technology Innovation Board Daily" that the Mexican e-commerce market is still in its early stages of development. For newcomers to cross-border trade or small to medium-sized businesses with lower risk tolerance, it is advisable to temporarily avoid entering new markets such as Mexico and instead prioritize mature, already validated markets.

The fluctuations in U.S. tariffs are "forcing" foreign trade personnel to transform and upgrade.

However, Zhao Jia (pseudonym), a Chinese American seller, revealed that products that are 100% processed and produced in the United States have costs that are approximately 5-7 times that of those in China.

"In fact, American consumers have become reliant on Chinese products; many Americans just refuse to acknowledge this. Even if tariffs increase to 100%, Chinese products remain competitive," Zhao Jia told a reporter from the Science and Technology Innovation Board Daily. He stated that after the tariffs are imposed, consumers will have to pay higher prices, and the profit margins for retailers will also be squeezed, "because not all consumers can fully accept price increases triggered by rising tariffs."

"Today, a U.S. client asked me to draft a new contract, and I feel that in the end, they will have to compromise and accept the price increase," a seller from Shandong told a reporter from the Science and Technology Innovation Board Daily. After the introduction of the tariff policy, he communicated with his old customers in the U.S., and initially, this client was not accepting. This seller told the reporter that many products that were not produced in the U.S. market before may still be unable to be produced independently in the near future. "Ordering earlier is cheaper than the increased tariffs and future costs."

Cross-border seller Liu Zheng (pseudonym) told the reporter from the Science and Technology Innovation Board Daily that under the new tariffs in the United States, the profit margin for his products may be thin, and he might even incur losses. According to Liu Zheng, he has gradually started to shift from the U.S. market to other markets such as Europe, the Middle East, and Latin America since 2023. Last year, his total revenue was around 100 million yuan, and currently, the U.S. market accounts for less than 40% of his business.

When talking about why he shifted to markets outside of the United States, Liu Zheng told the reporter from the Science and Technology Innovation Board Daily that the U.S. market is actually very "competitive," with terminal prices continuously declining while costs keep rising, resulting in profits not being able to increase. Therefore, more energy and resources were invested in other markets.

"We started operating in the U.S. market in 2021, but by 2024 there have been no new products launched, and we have been maintaining old links and old products." Liu Zheng stated that although the order volume in the U.S. is large, if the return on investment is too low later, we may completely withdraw.

For the European market, according to Ji Lei, the founder of Youzi Chuhai, the level of development in European e-commerce is quite high. Similar to how TikTok initially formed a closed loop in the UK, "therefore, for cross-border merchants concerned about the stability of the American market, the European market will also be a relatively good opportunity."

"The fluctuations in U.S. tariffs are forcing the foreign trade industry to upgrade, with a clear trend towards branding." Gong Zhihao, Vice President of Yicang Technology, stated in an interview with the Science and Technology Innovation Board Daily that tariff pressures are driving foreign trade from price competition to value cultivation.

"Foreign trade merchants can leverage cross-border e-commerce to accurately acquire customers, accumulate private traffic, or use independent sites to face consumers directly through the DTC model, strengthening the penetration of brand stories while focusing on high-margin products, thereby solidifying differentiated competitive advantages through design and technology." said Gong Zhihao.

Source: Science and Technology Innovation Board Daily

Author: Ke Chuang Ban Daily