Shein raises US prices by up to 337pc as e-commerce giants face price pressure

SINGAPORE: Fast-fashion giant Shein Goup Limited, raised US prices of its products from dresses to kitchenware ahead of imminent tariffs on small parcels in an early sign of the potential effect of the trade war on American consumers.

Most of the hikes in US prices came on Friday, with markups significantly higher in some categories than others. The average price for the top 100 products in the beauty and health category increased by 51 percent from Thursday, with several of the items more than doubling in price. For home and kitchen products and toys, the average jump was more than 30 percent, led by a massive 337 percent increase in the price of a 10-piece set of kitchen towels. For women’s clothing the rise Is 8 percent.

E-commerce shopping platforms like Shein and Temu face a 120 percent tariff on many of their products due to the US government’s decision to end the ‘de minimis’ exemption for small packages from mainland China and Hong Kong. Exporters in recent years had capitalised on the exemption, which allowed goods valued at under $800 to enter the US without tariffs or customs duties. Washington will also increase the per-postal-item fee on goods entering after May 2 to $100 and even higher after June 1.

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As recently as April 21, Trump in a social media post that “there is virtually no inflation” because of falling energy and grocery prices. But Shein’s price hike reflects the latest effort by Chinese online retailers to pass at least some of the extra import costs onto US consumers.

Back in February, in order to seek cover from Trump’s tariff policy, Shein offered incentives to some of its Chinese suppliers to set up production capacity in Vietnam. Temu wanted Chinese factories to ship their own wares in bulk directly to American warehouses, adopting what it called a “half-custody” framework.

Temu and Shein saw sales rebound in March and early April as American shoppers stockpiled everything from makeup brushes to home appliances before tariff-led price increases set in, Bloomberg data shows.

Both companies announce earlier this month that they would raise prices in the US.

In general, prices rose by about 10 percent for Shein in the US from April 24 to 26 based on a sample shopping cart, with 50 items from a range of categories. During the period, 7 out of 50 sampled items were delisted in the US. In contrast Shein’s prices in the UK stayed mostly unchanged and no items were delisted.

Of the 43 items still available in the US cart, 30 had a price hike of more than 10 percent in the two days.

While broader price adjustments came on Friday, some goods had already become more expensive. The prices of dozens of top products in the Women’s Clothing category on Shein increased on April 22, pushing the average price for the top 100 products in the category to $9. 06. from $8.68, an increase of more than 4 percent.