Temu and Shein to Rethink Supply Chains During Temporary Lowering of US Tariffs

Temu and Shein reportedly have an opportunity to restock their U.S. warehouses during a temporary reduction in tariffs.

An agreement between the U.S. and China that was announced Monday (May 12) lowered tariffs on most Chinese imports from 125% to 30% for 90 days and lowered the tariffs on low-value packages from 120% to 54%, CNBC reported Tuesday (May 13).

This temporary reprieve gives Temu and Shein a chance to adjust their supply chains while still fulfilling orders, according to the report.

When the previous, higher tariffs were implemented, Shein raised prices on goods bound for U.S. consumers, while Temu stopped shipping goods directly from China to the U.S., the report said.

The companies are now likely to resume sending bulk shipments to the U.S., despite the 30% tariff that remains in place, per the report.

Shein has already begun to expand its supply chain, building manufacturing facilities outside of China in order to avoid the new tariffs, according to the report.

When announcing the changes to the tariffs in an executive order issued Monday, President Donald Trump said the modifications reflected U.S. discussions with the People’s Republic of China (PRC).

“Since I signed Executive Order 14266, the United States has entered into discussions with the PRC to address the lack of trade reciprocity in our economic relationship and our resulting national and economic security concerns,” Trump wrote in Monday’s executive order. “Conducting these discussions is a significant step by the PRC toward remedying non-reciprocal trade arrangements and addressing the concerns of the United States relating to economic and national security matters.”

The National Federation of Independent Business (NFIB) said Tuesday that uncertainty around tariffs contributed to a decline in optimism among small businesses in the U.S.

It was also reported Tuesday that a group of five American small businesses is suing Trump over his tariffs, arguing that the president overstepped his authority in declaring a national emergency to impose the levies last month.

Simon Property Group Chairman, CEO and President David Simon said Monday that he applauded the Trump Administration’s elimination of the de minimis exemption, which allowed packages worth less than $800 to enter the U.S. without paying a tariff.

Speaking during the company’s quarterly earnings call, Simon said the rule hurt retailers that were not able to avoid paying the tariffs and benefited Chinese retailers that ship directly to U.S. consumers.