USPS resumes package delivery from China and Hong Kong after a brief suspension, to collaborate with Customs to collect the new China tariffs efficiently and minimize delivery delays.
U.S. Postal Service (USPS) briefly suspended package acceptance from China and Hong Kong after a 10% tariff hike and the removal of the “de minimis” tax exemption. This threatened e-commerce sellers relying on low-cost shipping.
The ban risked higher costs, shipping delays, and price hikes for businesses and consumers, impacting platforms like Shein, Temu, and Amazon.
A day later, USPS reversed course, confirming it would continue accepting packages while working with Customs to implement a tariff collection process, helping sellers maintain stable supply chains.
USPS lifts suspension on packages from China and Hong Kong
The Associated Press reported that the USPS has reversed its decision to halt inbound packages from China and Hong Kong just one day after announcing the ban.
The initial suspension followed the U.S. government’s move to impose a 10% tariff on Chinese imports and eliminate the “de minimis” exemption, which previously allowed packages valued under $800 to enter the country tax-free.
Policy Reversal and Tariff Implementation
An article on The Hill noted that In a statement released Wednesday, USPS clarified that it is working with U.S. Customs and Border Protection (CBP) to implement a tariff collection process while minimizing disruptions to package delivery.
The brief suspension raised concerns for online retailers relying on USPS for affordable shipping, including Amazon sellers and platforms like Temu and Shein. Without USPS handling these shipments, businesses faced potential delays and increased costs from using private carriers like FedEx and UPS. The resumption of service helps ensure:
- Steady Inventory Flow – Sellers sourcing from China can continue restocking without major disruptions.
- Cost Control – USPS remains one of the most affordable shipping options for low-value imports.
- Business Continuity – Amazon FBA sellers and independent e-commerce businesses can maintain fulfillment efficiency.
Ongoing Challenges and Adjustments
Although USPS has resumed package acceptance, the new Trump tariffs and the removal of de minimis benefits will likely impact costs for both sellers and consumers. Amazon sellers may need to adjust pricing, explore alternative shipping options, or optimize their Amazon marketing funnel to maintain profitability.
With trade policies shifting, e-commerce businesses must stay informed and adapt to regulatory changes that could affect international shipping and product pricing.
What it Means to Amazon Sellers and E-commerce
With the end of the de minimis exemption and new 10% tariffs on Chinese goods, e-commerce sellers face major changes. Many businesses that relied on cheap imports will now need to adjust their pricing strategies, optimize supply chains, and explore new sourcing options.
Steven Pope, founder of the Amazon agency My Amazon Guy, weighed in on the impact, stating, “Amazon sellers will need to rethink their sourcing strategies. The closure of the de minimis loophole significantly changes the cost structure for many e-commerce businesses. While some sellers may shift to U.S.-based manufacturing, it won’t be an easy transition.”
Amazon’s Response and the Future of U.S. Manufacturing
Amazon, which has long paid internet sales taxes and import duties, is expected to benefit from this policy shift as its competitors, particularly Temu and Shein, face rising costs. The removal of the de minimis loophole could accelerate a trend toward domestic manufacturing, as businesses look for ways to reduce reliance on Chinese imports.
Reducing Reliance on Chinese Manufacturing: Key Strategies
The pandemic revealed America’s heavy reliance on Chinese manufacturing, but the need to diversify and strengthen supply chains remains crucial. Outlined in IndustryWeek, here are five key strategies to reduce dependency on China:
- Diversify Supply Chains – Source from multiple suppliers and consider “friendshoring” with countries less affected by geopolitical risks.
- Strengthen Cybersecurity – Secure both IT and operational systems to protect against rising cyber threats from China.
- Reshore and Nearshore Production – Move manufacturing back to the U.S. or nearby countries like Mexico to reduce risks.
- Invest in Advanced Technology – Use automation and AI to increase production efficiency and reduce foreign reliance.
- Develop Flexible Production – Build agility to quickly pivot in response to disruptions or government mandates.
Challenges of US Manufacturing
However, manufacturing in the U.S. comes with challenges. High costs, labor shortages, and infrastructure needs make large-scale production difficult in the short term. Sellers considering local manufacturing will need to weigh the benefits against the investment required to make it viable.
Let’s look at the challenges in reducing its reliance on Chinese manufacturing, as outlined by the Stanford Center on China’s Economy and Institutions. Key points include:
Slow Reshoring Progress – While reshoring efforts have increased, manufacturing employment has grown slowly, and the sustainability of these trends remains uncertain.
Rising Trade with Vietnam and Mexico – Imports from Vietnam and Mexico have increased, but these countries still rely on China for parts, keeping China involved in U.S. supply chains.
Supply Chain Complexity – Indirect links between China and U.S. suppliers persist, making it difficult to fully decouple.
High Costs of Shifting Production – Moving production away from China is costly, and tariffs have led to higher prices for U.S. businesses and consumers, complicating the shift.
Dave Evans, Co-Founder of Fictiv. Stanford MechE. Ford Alum."U.S. manufacturing faces other key challenges that can impact overall growth, competitiveness, and sustainability..."
There are other difficulties that US manufacturers are facing, according to a Forbes article:
- Labor Shortages and Skills Gaps – A shortage of skilled workers, especially in engineering and tech fields, is growing as the workforce ages.
- Regulatory and Environmental Pressures – Strict regulations and sustainability demands increase operational costs, putting U.S. manufacturers at a competitive disadvantage.
What Amazon Sellers Should Do Next
As these changes take effect, sellers should focus on:
- Optimizing Costs – Analyzing profit margins and adjusting pricing to account for new tariffs.
- Exploring Alternative Sourcing – Considering suppliers outside of China or moving some production to the U.S.
- Strengthening Amazon Listings – Improving Amazon SEO, PPC campaigns, and conversion rates to maintain profitability despite rising costs.
- Leveraging Brand Registry and Storefronts – Protecting intellectual property and enhancing brand presence to stand out in a competitive market.
With trade policies evolving rapidly, Amazon sellers must stay informed and adapt to ensure long-term success in the shifting e-commerce landscape.
