Fast fashion giants Shein and Temu are hiking prices as a key U.S. trade exemption expires Friday, and shoppers are already feeling the impact.
The long-standing “de minimis rule,” which has allowed imported goods valued under $800 to enter the U.S. without duties or customs paperwork for years, will no longer apply to goods from mainland China and Hong Kong — home to most of the inventory sold by the two companies.
Several popular items on Temu have seen steep price increases in recent days. A 3-in-1 portable air conditioner that was $21.47 now costs $30.67, while a men’s graphic tennis T-shirt jumped from $9.93 to $14.43. Even basics like girls’ hoodies and power strips have doubled in price.
Josh Levine, director of tech policy at the Foundation for American Innovation, which promotes limited regulation in the technology sector, told The Washington Times the loophole closure is likely to change things for poorer and younger shoppers who might have relied on the cheaper clothes the Chinese companies offer.
“I can’t say that it’s bad that people are wearing fewer clothes infected with lead. But at the same time, it’s hard to generalize that across every single purchaser and every single person. It’s a personal issue,” Mr. Levine said, citing research from Seoul’s government trade agency that found lead, formaldehyde and phthalate-based plasticizers in Chinese fast fashion last year.
Shein told The Times last year that its clothing has no illegal levels of toxic chemicals.
Kate Nishimura, features editor at Sourcing Journal, told New York Magazine that “de minimis is the backbone of [Shein and Temu’s] business model.”
Now, all de minimis shipments from China and Hong Kong will be assessed at 30% of their value or $25 per item, whichever is higher, by the weekend. That figure reflects an across-the-board tariff hike.
Commercial carriers like FedEx and UPS will now be required to collect duties at a rate of 145% on declared item value, while the U.S. Postal Service will charge either a 120% tariff or a flat fee of $100 per package, rising to $200 on June 1.
Freight traffic between the U.S. and China is already declining, with logistics experts warning that new rules could add pressure to ports and shipping systems still recovering from post-pandemic disruptions.
Kristen Classi-Zummo, an apparel industry analyst at the market research firm Circana, told The Associated Press that economists expect the market for resale items to grow in the midst of a declining market.
“What I think is going to continue to win in this chaotic environment are channels that bring value,” Ms. Classi-Zummo said.
Mr. Levine agreed. “Used [clothing] is just going to be safer and be worth more,” he told The Times.
Thrifty shoppers
Thrift stores, where shoppers can find equivalent, cheaply priced goods, have been quietly building a broad U.S. customer base for years.
According to ThredUp’s 2024 Resale Report, 58% of U.S. consumers shopped secondhand last year — the highest on record. This figure was even higher among millennials and Generation Z, at 68%, with nearly half saying they now check thrift options before buying new.
“Secondhand prices are going to be much more compelling in relative terms,” Alon Rotem, chief strategy officer at ThredUp, told USA Today. “In the era of tariffs, it’s an even more unique way to shop and get what you’re looking for, and see prices not rise.”
The expected growth in thrift won’t just be an American phenomenon. Fueled mostly by Gen Z’s thrift-loving habits, the global secondhand clothing market is on track to outpace the rest of the fashion industry threefold by 2027, according to resale site ThredUp.
Even thrifted products are expected to increase in price.
Kristin Langenfeld, CEO of baby gear resale platform GoodBuy Gear, said she’s bracing for price increases across dozens of brands her company works with.
“Every one of them that we’ve talked to has either already or is in the process of increasing prices on almost all of their products,” she told USAToday.
Babylist, a popular baby registry platform, reports that 67% of expectant parents now report secondhand as their primary savings strategy.
Kelsey Meyers, a mother of four in Minnesota who’s been thrifting since her teen years, told USA Today she’s seen prices tick upward at her local thrift stores as a result of the Trump administration’s recent tariff scuffles. But she prefers secondhand, anyway.
“You’re still getting a deal, but … it’s not what it used to be,” she said.
For more rural shoppers without nearby physical thrift stores, Mr. Levine said online thrifting platforms like eBay, ThredUp and Poshmark will step up to fill the gap. And their business model ensures that quality is more likely to be higher than what they were getting from China, he added.
“eBay, for instance, does a really good job of buying, selling and verifying the quality of clothes, quality of seller, ensuring that it protects you when you spend your money, that you’re actually going to get what you ordered, and if you didn’t — cover you,” Mr. Levine told The Washington Times. “These online stores sell real higher-end fashion stuff.”
Nevertheless, the rising demand for thrifted finds may stretch supply thin, online or otherwise. Sheng Lu, a fashion trade professor at the University of Delaware, said secondhand children’s clothing, for instance, could become harder to find.
“I’m afraid that the supply can be more limited,” Mr. Lu told USA Today, adding that poorer families may increasingly just have to “make do with less.”
De minimus reform
Chinese officials haven’t spoken directly about the de minimis closure, though the foreign ministry has expressed frustration with President Trump’s tariff strategy overall.
Foreign Ministry spokesman Lin Jian told China Daily earlier this year that the tariff measures “seriously undermine the principles of the market economy and international trade rules.”
In response to the U.S. crackdown, Beijing has imposed retaliatory tariffs of up to 125% on American goods, further escalating the trade standoff between the world’s two largest economies.
According to U.S. Customs and Border Protection, more than 70% of the 216 million packages entering the U.S. in January and February originated from China. Officials estimate that up to 4 million such low-value parcels arrive daily, most of them duty-free — until now.
And Shein and Temu have slashed their advertising budgets, cutting spending on Google by 31% and on Meta by 19%, according to Reuters.
A Shein spokesperson told The Washington Times last fall, however, that the company supports de minimis reform, even as the shopping giant faced continual accusations of loophole abuse.
“SHEIN makes import compliance a top priority, including the reporting requirements under U.S. law with respect to de minimis entries,” the spokesperson said in an email. “We reaffirm our executive chairman’s call for [de minimis] reform that ensures a level, transparent playing field where rules are applied equally.”
For now, retailers, families and policymakers alike are watching what happens next.
“Parents need to buy a stroller, they need to buy a bassinet, they need to buy a high chair,” Ms. Langenfeld said of products many new parents buy from Chinese manufacturers. “These aren’t optional purchases.”
Not every fashionista welcomes the lifestyle shift sparked by the loophole’s closure.
“I’m a naturalized citizen of immigrants and when we immigrated we absolutely had nothing for a pretty long period of time,” wrote a shopper on Reddit this week, insisting that Shein and Temu’s product quality is higher than is commonly reported.
“As an adult it took me a while to set myself up and have $ to buy nice new things that these Asian suppliers sell,” the Redditor added. “It finally made it feel like I get to have nice things too … I feel like all of this is basically punishing the low to middle income class in a very severe way.”
The Washington Times has reached out to Shein and Temu for additional comment.
