Question

How has amazon been affected by the US-China trade war, other than new imposed tariffs.

Answer 1

The Trump tariffs are a series of tariffs imposed during the presidency of Donald Trump. In January 2018, Trump imposed tariffs on solar panels and washing machines, and in March 2018, he imposed tariffs on steel and aluminium.

The case the White House is making is that the tariffs necessary to protect vulnerable American industries.

President Donald Trump had said that the US which has nearly USD 800 billion deficit with other countries is ready for a trade war with them if they retaliated against his decision to impose 25 per cent import tariff on steel and 10 percent on aluminium.

On March 7, US President Donald Trump announced 25% tariffs on imports of steel and aluminium from China.

China responded by saying it would impose duties on $3bn worth of US products, announcing tariffs of up to 25% on imports of food including frozen pork, wine and some fruits on April 1

Stockmarkets across the world have fallen anticipating a full-blown trade war between the United States and China.

The tariffs measures were poorly received by the vast majority of economists; almost 80% of 104 economists surveyed by Reuters believed that imports on tariffs on steel and aluminum imports would be a net harm to the U.S. economy, with the rest believing that the tariffs would have little or no effect; none of the economists surveyed believed that the tariffs would benefit the U.S. economy.

On the other hand, the trade war can badly affect China too. If China’s exports suffer from President Trump’s upcoming trade actions, and any copycat barriers elsewhere, domestic consumption hardly looks robust enough to carry growth.

Should a trade war escalate between the US and China, consultancy Wood Mackenzie estimates that global economic growth could slow from 2.9% to 2.2% over the next four years.

The small, open economies in the eastern part of the European Union will suffer disproportionately if the global trade war currently brewing extends to Europe, analysts have warned.

Amazone impact
It may be less expensive in the short-term to stock up on inventory ahead of the threatened January tariff increase, even if you have to look to third party logistics providers. Switching to Seller Fulfilled Prime may be another option that ends up cheaper now than paying the higher tariffs later. For FBA sellers, know that Amazon now determines your FBA capacity based on the sell-through rate of each individual SKU. This means that slower-moving items may end up with a cap on inventory levels. You may want to create an FBA shipment now to test those waters.

The Trade War may make for uncertain times in business, but, as usual, the one constant seems to be change. A business’s ability to roll with the punches makes all the difference going forward. With little way to predict the future of trade relations with China right now, it’s time to develop a plan B that takes into account the complexity of dealing with Amazon. According to experts like Thomson, preparing ahead for a lengthy conflict, developing new product lines and sourcing alternate suppliers are among your next best moves.