How Etsy and eBay Are Winning in the U.S.-China Tariff War
Last Friday, the United States officially ended over 100 years of duty-free clearance for postal parcels originating from China. Almost simultaneously, Temu suspended all listings under its fully managed model shipping from China to the U.S. Meanwhile, many American consumers noticed sharp price increases at checkout on platforms like Amazon Haul and Shein, leading to a geometric rise in cart abandonment rates. Many sellers reported a steep drop in order volume across major platforms.
On the B2B side, U.S. media revealed that Walmart and Target instructed Chinese suppliers to ship goods and agreed to cover the tariffs themselves. The reason: Trump reportedly granted special exemptions for these large retail chains to avoid tariffs on orders already placed with Chinese factories. However, for Chinese suppliers, this might be their last round of orders from American retail giants.
While U.S.-China trade negotiations have yet to begin, Trump publicly urged Americans not to waste money on cheap Chinese goods and called on recent U.S. college graduates to support domestic manufacturing and the real economy. Clearly, the U.S. is now fully prepared for a long-term and persistent trade cold war.
It is evident that China's e-commerce model based on low prices and high volume growth came to an end on May 2, 2025. While many sellers are feeling lost, U.S. tech media outlet TechCrunch reported on May 3 that eBay and Etsy are experiencing a surge in sales following the downfall of low-cost platforms. In this article, Hui Creative explores new opportunities for Chinese sellers through these less commonly used platforms and fresh e-commerce strategies in the high-tariff era in the U.S.
Part One: Why “Low Price + High Volume” Creates High Risk
The U.S. government has publicly stated multiple times that it is prepared to negotiate with China and reduce tariffs on Chinese goods. Here's a breakdown of the expected tariff strategy:
- Push for labor cost increases and open exchange between RMB and USD
- Bring high-end manufacturing back to the U.S.
- Shift low-priority industries to U.S. allies or neighbors
- Distinguish tariffs between Chinese-made and allied-made goods
- Implement quotas to prevent market flooding by Chinese products
Estimated tariff levels include:
- 200–3000% for industries like solar, chips, biotech, autos
- 30–70% for general consumer goods
- Minimum 10% for other countries, adjusted by trade surplus
With the tariff deal delayed until Q3 2025, American retailers are being discouraged from ordering China-made goods for the holiday season. For many manufacturers, cash flow will become an issue, and survival will depend on adaptation.
Part Two: Why Etsy and eBay Are Thriving
Chinese sellers and companies relying on China’s supply chain are under heavy pressure. Platforms like Temu, Shein, and Amazon Haul are seeing massive drops in listings due to the loss of T86 exemption. Amazon sellers are anticipating a weak Prime Day, and UPS is preparing for reduced order volume by laying off 20,000 workers.
Meanwhile, domestic U.S. sellers are gaining traction as Amazon and other platforms shift focus to local suppliers. Incentives are increasing for U.S.-based small businesses.
Etsy’s Comeback
Etsy, with over 90% local sellers, has become a safe haven during global trade shifts. Though its sales dropped 11% in 2024, it rebounded after Trump’s tariff announcements in March 2025.
eBay’s Resilience
eBay shifted toward refurbished and secondhand goods. Only 5% of its U.S. shipments originate from China, making it less vulnerable to tariffs. As a result, it is seeing renewed buyer activity.
Part Three: Etsy + Amazon Strategy for Growth
Hui Creative recommends testing new designs on Etsy before scaling across Amazon, Temu, Shein, and TikTok.
- Launch POD items on Etsy to gauge demand and product appeal
- Transfer best-performing SKUs to Amazon using Amazon listing optimization and local fulfillment
- If cost-effective, shift production to China and scale via FBA
What’s Next for Sellers
Succeeding in a high-tariff environment means being flexible, diverse, and local. Platforms like Etsy and eBay will continue to gain traction.
Want expert help? Contact Hui Creative or explore our complete growth services for Amazon and Etsy sellers.