Apéro, a Brisbane-based maternity clothing label, has recently decided to halt shipments to the United States, which historically accounted for a significant portion of its revenue. This decision follows U.S. President Donald Trump’s implementation of steep tariffs on imported goods, particularly affecting companies that manufacture clothing in China. As co-founder Laz Smith notes, the tough choice emphasizes the uncertainty facing many Australian businesses in the evolving trade landscape.
Since Trump’s “Liberation Day” announcement of global tariffs, the situation has only worsened. While Australia faces a baseline tariff rate of 10%, goods made in China encounter much higher rates, currently hovering over 40%. This has sparked what Smith describes as a “quasi-global trade war,” where Australian companies are left unsure of future conditions as negotiations between the U.S. and China continue to be delayed.
A particularly impactful change is the end of the “de minimis” exemption, which previously allowed packages valued under $800 to bypass import taxes. Starting August 29, this exemption will be terminated for all countries, including Australia, potentially imposing fees of up to $80 on Australian goods sold in the U.S. This transition adds to the chaos faced by retailers trying to adapt to an unstable environment.
Data from tech company Shippit indicates a 36% decrease in shipments from Australia to the U.S. since April, emphasizing the practical effects of the tariffs. Retailers are being forced to reevaluate their strategies, with some, like Nashie, relocating their logistics to the U.S. to mitigate tariff impacts. While this may provide some insulation against fluctuating rates, it adds additional costs for those importing goods in bulk from China. Nashie’s founder, Tom Wilson, describes having to pay significant tariff bills, adding pricing pressure on U.S. customers.
The broader concern affects not only retailers but also consumers in Australia, who may soon see rising prices as brands adjust to higher operational costs dictated by tariffs. Smith highlights the ongoing need for support from Australia’s trade department, citing a lack of guidance in navigating these challenges. Although the Australian government has pledged financial assistance for affected businesses, details are still pending Parliamentary approval.
Overall, businesses like Apéro and Nashie are at a crossroads, forced to adapt to volatile international trade conditions while hoping for clearer direction and support from their government as they navigate this tumultuous landscape.
