Written By Sierra Perrin Hee
With the changing of the presidency, came a changing of the economy. As President Trump stepped back into office, he immediately set the goal of prioritizing “American made” products, leading to a slew of tariffs on imported goods, many of which will negatively impact the fashion industry. President Trump’s goal is to help American producers by making imports more expensive and allow goods made in the United States to prosper. However, according to Monica Miller of NPR news, “only 3% of clothes today are made in America” and the introduction of these tariffs will cause many companies to redistribute their resources and factories to countries other than China, Canada, and Mexico (Miller 2025). Still, President Trump intends to continue to impose tariffs in hopes of making American products more competitive.
For small brands, these tariffs are extremely detrimental to their business. Since smaller brands have a smaller customer base, they have no bargaining power when it comes to supplier relationships. Paying more to suppliers raises costs, a situation that is only exacerbated by tariffs. Also, smaller brands tend to employ lower prices in order to attract buyers and build customer base, so tariffs put additional pressure on the business to be profitable. Therefore, every cent a producer can save in production is extremely important for revenue. For instance, as Chris Gentile, Pilgrim Surf + Supply owner stated “The tariffs ‘would be devastating… I don’t know how we could function’” (Gallagher 2024). For Gentile’s products, work coats and fleece zip ups, the material is very important to the product for providing both warmth and comfort. It would be very difficult for many producers to switch both from a cost perspective, and also to build a relationship with suppliers in other countries to begin producing the fabric.
In addition to difficulties related to changing supplier countries, imported items are likely to be of lesser quality and produced less efficiently. “‘The best cut and sew in the world comes from China,’ Mr. Gentile said. ‘China is so advanced in that space that there’s really no place to go and pick up that slack from’” (Gallagher 2024). Finding fabrics and production as efficient as China is going to be very difficult. As Naika Colas said “Thirty-plus percent of all fashion brands are producing in China currently” so the switch is going to be a large one (Miller 2025). To produce goods domestically or in non-tariff countries will require a delay in production, an increase in production costs and likely result in lower quality, more expensive products.
Brands may have to switch production to countries with cheap labor, such as Venezuela, to help maintain profitability. Interruptions negatively impact production and revenues. As the tariffs are still new, the likely solution for brands to maintain profitability is to pass the increasing costs from tariffs onto the consumer. According to the National Retail Federation, tariffs imposed by President Trump may result in increases of apparel prices by up to +12.5% and those of footwear by +18.1% (Gallagher 2024). For consumers, these prices will prevent many from buying these clothing items and most likely many consumers will exit the market. If consumers do exit the market, producers may be hit even harder than they already are as both production costs will increase and sales may fall.
Possibly the most detrimental effect of Trump’s tariffs is the elimination of the “de minimis” exemption. The de minimis exemption allows Americans, either individuals or businesses, to buy up to $800 worth of goods each day duty free (Hadero 2025). The de minimis exemption was introduced to increase efficiency and affordability of imported goods, but it also supports American small business owners who often rely on e-commerce such as those found on Etsy and other websites. According to the National Foreign Trade Council, “the savings these businesses get through the tax exemption are passed on to consumers and allow businesses to hire and expand”(National Foreign Trade Council 2025). Therefore the elimination of de minimis is hurting business owners as costs of imported goods increase and the company is unable to grow in ways the exemption had supported.
Although some tariffs are currently suspended, sellers are beginning to look for possible alternatives in manufacturing their products to limit their exposure to import tariffs. One possible solution is tariff engineering. Rather than companies sourcing all the components of a good from countries with large tariffs, tariff engineering splits up the source of product components among various countries. For instance, if the fabric from China is a necessity, the company may import this fabric but save costs in other areas by obtaining the zippers, buttons, and other details from other countries (Zwieglinska 2025). Tariff engineering provides a way to lessen the impact of these new tariffs without completely changing product makeup. However, this process is likely not possible for small business owners, at least not quickly, as it is much more difficult for small brands to build relationships with producers and be able to outsource different aspects of production as easily and efficiently as large brands can.
The fate of American tariffs this early on is somewhat unclear, but one thing is for sure, if the tariffs stay, our exports will begin to face retaliatory tariffs when entering the borders of Canada, Mexico, China, and any other countries whose goods face tariffs when entering U.S. borders. As China’s Ministry of Commerce has already publicly stated, they plan to file a legal case against the United States at the World Trade Organization and ‘will take corresponding countermeasures to firmly safeguard its rights and interests,’ but they have yet to confirm what these countermeasures are (Bradsher 2025). It seems that the tariffs may lead to larger problems with international trade as barriers likely will arise in other countries.
Although primarily these tariffs will hurt small business owners as large brands can much more easily switch modes of production, very few brands are still “American made.” For instance, the infamous all-american Levi Strauss Co. in the early 2000’s shut down its U.S. factories and now sources its denim across the world in many developing countries (Ortiz). In general, it is just too expensive to source and produce clothing within U.S. borders when labor is cheaper and more efficient abroad.
From the fashion industry’s standpoint the tariffs appear to be benefitting large American companies that can more easily outsource from countries other than China, Canada, and Mexico. Small businesses will have more difficulty changing supply chains and are going to take a hit to their profits. If the tariffs continue it appears that companies will be impacted further by having to face tariffs on the back end when selling to consumers outside U.S. borders. Either way, both consumers and producers will be hurt as prices will inevitably rise. Many consumers will leave the market, once again negatively impacting sellers. Nevertheless, the few brands left that are truly “made in the USA” will continue to prosper without facing much impact from these tariffs. Consumers should prepare to pay higher prices, but can take solace in the fact that they will be doing their part to support the U.S. economy.
References
Bradsher, K. (2025). China Assails Trump Tariffs and Threatens ‘Countermeasures’.
The New York Times.
https://www.nytimes.com/2025/02/01/us/politics/china-trump-tariffs.html
Gallagher, J. (2024). The Fashion World Fears High Tariffs. The New York Times.
https://www.nytimes.com/2024/11/13/style/fashion-tariffs.html
Hadero, H. (2025). Fast fashion, laptops and toys are likely to cost more due to US tariffs on
Chinese imports. American Post.
Miller, M. (2025). How Trump tariffs will affect U.S. fashion. National Public Radio.
https://www.npr.org/2025/02/13/nx-s1-5293434/how-trump-tariffs-will-affect-u-s-fashion
National Foreign Trade Council. (n.d.) De Minimis: A Vital Tax Exemption. National Foreign Trade Council. https://www.nftc.org/de-minimis-a-vital-tax-exemption/
Ortiz, G. (2019). Levi’s is No Longer Producing Any 501 Jeans in America. Heddels.
Shlabotnik, J. (2016). Give Work Buy American Made Goods [Photograph]. Flickr. https://www.flickr.com/photos/joeshlabotnik/26624255444
Zwieglinska, Z. (2025).Fashion’s new trade crisis: How brands are scrambling to navigate Trump’s tariffs. Glossy.