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The update puts US tariffs on China more in line with existing global levies. The European Union is currently subject to 10 per cent tariffs; Mexico and Canada tariffs are both 25 per cent; the UK is also subject to 25 per cent (save for non-fashion-related exemptions). Former tariff rates revealed on 2 April, ranging from an additional 10 to 50 per cent and targeting Asian manufacturing countries, are currently on pause until 8 July. Investors may be excited about the China pause, but for brand owners, it’s not all happy news as the looming 90-day deadlines mean more changes could come, adding to previous whiplash. But this does give brands some breathing room. “Honestly, [it’s] a mix of relief and frustration,” says Georgia Cherrie, co-founder of ready-to-wear brand Paris Georgia. “Relief because it offers a momentary breather, but frustration because it still feels like we’re all caught in a game, and businesses like ours are being squeezed in the middle. The uncertainty is exhausting, and it’s already pushing some brands to the brink.” “The pause is helpful to brands as it buys them more time and gives them more flexibility. However, it does not stop the uncertainty as there is still so much upheaval and chopping and changing in tariff policy — and the current change is only a pause,” says Neil Saunders, managing director of retail at market research firm Globaldata. “I expect most brands will still explore moving to a more balanced supply chain with less reliance on China. But some will now adopt a wait-and-see approach.”Pimento Cheese 2028 Election Tee Shirt
Small to mid-size brands need to be careful about shifting strategy too fast, says Bernstein analyst Aneesha Sherman. “[They] will likely be pulling forward orders to get in before the 90 day mark and may end up with an inventory glut,” she cautions. Those who were already considering moving sourcing out of China are likely to continue on this path, says Jessica Ramírez, co-founder of retail consultancy The Consumer Collective. She recalls Trump’s last term, when many brands either moved operations out of China, or, at the least, diversified their manufacturing locations. “We will see the second wave,” she says of this moment. Paris Georgia, which was exploring shifting its China manufacturing elsewhere, is still planning to do so. If anything, this reinforces the founders’ plans, Cherrie says. “The landscape is so volatile right now that relying on a single region feels risky. We’re actively exploring alternative production hubs.” A 30 per cent tariff — though far better than 145 per cent — is not insignificant. But it’s much more manageable, Ramírez flags. This is top of mind for Cherrie. “Even if tariffs settle between 50 to 80 per cent, that level of increase fundamentally shifts the economics of running a fashion business,” she says. “It would force significant price adjustments, which goes against what we stand for.”
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