How retail brands are actually responding to tariff changes
There’s no one size fits all playbook.
It's no surprise that the tariff announcements coming out of the U.S. have turned into a genuine operational headache for brands. We’re talking to leadership teams every day who are deep in this: modelling, repricing, rethinking strategy, and trying to stay ahead of changes that are moving fast.
We’ve been inside the rooms where these conversations are happening. And while the commentary online is loud, the reality for most leadership teams is quieter, more complex, and more personal.
This isn’t about headline hot takes. It’s about unpacking how real brands are making decisions, and what we’re seeing across the board and in the boardroom.
What’s Happening (Latest Updates)
Here’s the short version of what’s changed:
Universal Tariffs: A flat 10% import duty now applies to all goods entering the U.S., with higher rates for 57 countries.
China Tariffs: Raised from 20% to 54% in April.
China’s Response: China has responded with a 34% tariff on all U.S. goods and export restrictions on rare earth minerals.
Trump now escalating further: With a now effective 104% tariff on China.
De Minimis Rule Change: From May 2, all shipments from China and Hong Kong, regardless of value, are subject to full tariffs and inspections.
More to Come: The U.S. government has signalled this could expand to other countries once admin systems are in place.
Markets have responded sharply. So have trade partners. But this piece is about the brand-side view.
104% Tariffs Are Wild
Let’s talk about that 104% tariff for a second.
It came in practically overnight. One day, brands were scrambling to deal with 20% or even 54% tariffs. The next, they were facing an effective doubling of landed costs on Chinese imports.
For many, it’s not theoretical. Imagine buying a ton stock from a Chinese manufacturer 6 months ago, negotiating hard to get your margins right, planning inventory around peak season, and then that stock arrives today. Surprise: the import cost has doubled. No time to reprice. No time to reroute. Just a new bill you hadn’t planned for.
It’s especially brutal for:
Brands with pre-sold wholesale contracts. Those deals were signed months ago, with fixed margins. There’s no wiggle room to pass costs on.
Retailers with poor cashflow. Paying 104% on top of your original invoice? That’s a death knell if you don’t have the reserves.
Investors and lenders. This changes the risk profile instantly. Products that were safe bets six months ago now look like liabilities.
And it’s throwing revenue-backed lenders into a difficult spot. Forecasts are destabilised. Confidence in repayment cycles drops. For brands relying on these types of solutions to fund inventory or growth, it could mean capital gets pulled or paused at the worst possible moment.
We’re already seeing cashflow plans rewritten. Finance teams are calling emergency meetings. Founders are deciding which contracts to break and which stock to abandon. It's triage mode.
Brand Reality #1: No One Has a Full Picture Yet
We’re seeing a lot of listening and learning right now. Leadership teams are absorbing the information, assessing exposure, and asking questions. Few brands feel they have a complete picture of what this means for their operations.
Everyone is modelling the impact. Some are taking a cautious approach to avoid knee-jerk decisions, others are already mapping out operational shifts. There are no easy answers, just a lot of brand-specific trade-offs to weigh up.
There’s no copy-paste solution. Every business we’re speaking with is approaching it differently based on their product mix, operational setup, and stage of growth.
Brand Reality #2: CFOs Are Scenario Planning Like Never Before
This is quickly becoming a boardroom issue. What we’re seeing is:
Pressure on margin forecasts
Urgency around modelling different scenarios
Increased interest in nearshoring, dual sourcing, and U.S. warehousing
One common thread? Even brands that saw this coming haven’t necessarily quantified it properly. Many are only now realising how much exposure they have, and how fast that exposure could erode pricing power or demand.
We’ve had clients shift from “wait and see” to “plan and act” in under a week.
Brand Reality #3: Risk Appetite Is Increasing Behind Closed Doors
Quietly, some brands are exploring loopholes. Not because they want to, but because they feel they have to. We’ve seen strategy docs circulating that include:
Reclassifying goods under different codes
Splitting shipments to stay under customs thresholds
Exploring duty drawback schemes or relabelling in intermediary countries
There’s a belief forming that enforcement will be overwhelmed. That if enough people push the boundaries, it becomes hard to police.
We’re not here to say whether that’s right or wrong. Just that it’s happening, and it’s a signal of how strained the situation is becoming.
Brand Reality #4: The De Minimis Change Isn’t Just a Fast Fashion Problem
Yes, low-value parcel importers (especially in fast fashion) will be hit hardest at first. But any brand sourcing from China and shipping DTC to the U.S. is now in the crosshairs.
We’re advising clients to treat this as a precedent, not a one-off. If you rely on de minimis today, and aren’t based in China, don’t assume you’re safe. UK and EU brands could be next.
What Brands Are Actually Doing
We're hearing similar themes echoed across different sectors. One brand contact summed it up like this:
"US distribution centres are quickly becoming a no-brainer, but the real blocker is cash. Can you afford the hit to move all your stock there at speed? For some, yes. For others, it’s forcing a rethink on whether the US is even viable right now. That’s triggering big pivots back to EU expansion."
We’re also seeing sourcing shifts playing out in real time. Brands heavily reliant on Southeast Asia are suddenly flying to Morocco to explore low-duty manufacturing options. At the same time, many are reworking their RRP structures in the US, benchmarking an average 10% price increase without losing conversion.
One other thread: UK-based brands are quietly pulling back from large US wholesale orders. If you’re filling a UK container for a wholesale partner, you’re now getting stung by duties calculated off wholesale prices, not cost price. That’s making some deals unworkable.
Here’s what we’re seeing from clients and partners:
Strategic shifts in manufacturing. Moving final assembly or labelling to tariff-friendly regions. Hard to execute, but already happening.
Opening U.S. distribution centres. Especially for UK-based brands with growing U.S. demand. The business case just changed.
Repricing SKUs. Some are adjusting their pricing architecture to absorb or pass on added costs.
Pushing shipping partners harder. Brands are asking for more flexibility, better customs clearance options, and faster insight on landed cost implications.
We're also seeing knock-on effects in the investment space. Traditional investors and revenue-backed finance providers are under pressure. For investors, it's a confidence issue, uncertainty around pricing strategy, margin erosion, and shifting market priorities make it harder to assess risk and growth potential.
For revenue-backed finance providers, the pain is even more immediate. Some of the most tariff-exposed brands have seen their forecasts destabilised almost overnight. There are reports of facilities being paused or scaled back as lenders reassess exposure. It's also forcing conversations about whether brands can and should use financing to fund stock migration or major operational shifts.
But brands are asking for more cash. They’re going back to investors, back to lenders, and saying: if we’re going to move fast, into U.S. distribution centres, into relabelling, into building regional supply chains, we need help funding it. That cash is now make-or-break for a lot of these strategies.
Is There a Silver Lining?
Maybe. But it’s too early to be definitive. Some U.S.-based brands are accelerating international expansion plans to avoid inflated local costs. We’ve had early conversations about U.K./EU entry strategies.
There’s talk that Trumpenomics might push the U.K. and E.U. into a tighter alignment. But we’re cautious on that narrative. It sounds tidy, but the politics rarely are.
Final Thoughts: Plan for Pain, Stay Agile
Some see this as Brexit 2.0, a self-inflicted wound that will hurt more than help. Others are holding out hope for policy reversals. But here’s our read:
Trump is unlikely to roll this back quickly. He’s surrounded by deal-makers, not diplomats.
Retaliation from China and others will probably entrench this direction, not reverse it.
Brands need to act as if this is here to stay.
So the advice we’re giving is simple:
Model harder. Act faster. Build agility into every part of your supply chain.
No one has a crystal ball. But the brands who come out of this ahead won’t be the ones who guessed right. They’ll be the ones who prepared for all the wrong turns and still found a way through.