How can Amazon sellers react to US tariffs? Strategic guide for European sellers

With the introduction of US tariffs, international trade is experiencing a situation with few precedents for European sellers who sell in the United States through Amazon.

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The tariffs imposed by the Trump administration have in fact reached high levels, starting from a base rate of 10% applied to almost all imports into the States, and reaching even stricter thresholds.

As a result, the pressure on margins has become unsustainable for many traditional business models. A product that previously cost $10 in import can now cost between $12 and $15, excluding shipping and Amazon fees. It is certainly not a marginal increase, but rather a real attack on the sustainability of entire product lines.

Amazon itself is actively monitoring the impact on sellers. And it is no coincidence that it has sent out emails to assess how tariffs are affecting sourcing, pricing, and logistics strategies. This attention, once again, shows how the platform is aware of the seriousness of the situation and the potential consequences on marketplace competitiveness.

But how can European Amazon sellers react to these new challenges?

We tried to take stock of the different alternatives available.

> Also read our article FBA or FBM, how to calculate the optimal stock quantity  <<<

Supply strategies: China and beyond

The first strategy many operators are pursuing is to review their supply chains, with diversification becoming in some cases a necessity. Several sellers are already building modular supply chains that combine components from different countries to optimize costs and risks. Vietnam, India, Mexico, and Turkey have long been valid alternatives to China, each with specific competitive advantages.

Vietnam, for example, is well positioned as the new manufacturing hub for electronics and textiles. It also offers a good balance between production costs and political stability. India, Mexico, and Turkey are consolidating as manufacturing centers with competitive prices. Eastern Europe, on the other hand, offers opportunities for high-quality products with shorter delivery times.

In this context, hybrid production is a potentially very smart strategy. Importing components from China and assembling them in countries with lower tariffs such as Mexico or Vietnam can significantly reduce the impact of tariffs while maintaining production efficiency.

All of this makes transition times crucial. Building new supplier relationships, verifying production quality, and restructuring logistics require time and significant investments. Therefore, it is better not to expect immediate results, although it is still advisable to start the diversification process right away if this is considered the most useful path.

Naturally, it is important not to lose sight of the qualitative aspect. Reviewing the supply chain, favoring markets with lower costs, must certainly not undermine the value of the original proposition but, on the contrary, should be the right opportunity to improve it further.

Customs consulting to use the right codes

Another often underestimated aspect is the need to resort to the correct classification of products, an element that can make the difference between profit and loss. A single product can often fall into multiple codes depending on how it is described, and a small change in wording can reduce the tariff burden by 20–40%.

This is why investing in professional customs consulting is essential. Working with customs consultants can lead to reclassifications that drastically reduce the tariffs applied. In short, an investment that pays for itself quickly through the savings obtained.

In this regard, it is always good to keep accurate documentation. With Amazon requiring ever greater precision in product classification, errors or inaccuracies can lead to costly delays, shipment rejections, and potential penalties. Every detail in the product description must be strategically designed to optimize tariff classification.

Pricing strategies: a gradual approach

We thus come to pricing strategies, among the easiest for sellers to review. Increasing prices—as the temptation goes—is not always the right answer. On Amazon, higher prices can exclude us from the Buy Box, drastically reducing visibility and sales speed. The goal is therefore to find the right balance between profitability and competitiveness.

In this context, the gradual approach generally works better. Instead of drastic increases, it is preferable to implement 2–5% increases, constantly testing Buy Box performance and conversion rates. Justify the increases with product improvements, brand value, or superior customer experience.

Thus, product differentiation becomes crucial. If your product looks identical to every other option on Amazon, you have no pricing power. And when tariffs hit, margins will vanish because you will not be able to raise prices without losing sales.

Working on strategic bundling and optimized packaging can help distribute fixed costs over a higher selling value. In some cases, you can bundle a €20 product with a complementary €10 product and sell them for $35 with new packaging to improve the margin by absorbing the impact of tariffs.

>>> You can also read our article VAT territoriality and international Amazon sales rates <<<

Advanced inventory management

To complicate matters, there are Amazon’s new limitations. In the US, the marketplace applies a 90-day inventory limit per ASIN in fulfillment centers, based on days of supply calculated from the last 7–14 days of sales. A system that often, however, does not reflect recent restocks or product launches.

In this scenario, inventory planning requires greater sophistication. With frequently changing tariffs and stricter storage limitations, you will need to better manage the balance of carry costs, stockout risks, and cash flow optimization.

Conversion optimization: how to maximize every visitor

When costs rise, every visitor becomes even more valuable. You can no longer afford to lose potential customers due to unconvincing pages or confusing descriptions. Instead, you need to convert more visitors into buyers, working on what you already have.

Your path in this sense must begin with product descriptions. The title must immediately communicate the value: what the product does and why it should interest the customer. When writing details, it is better to focus on the problems the product solves rather than its technical features. A customer does not buy “Bluetooth 5.0.” Rather, they buy a “stable, uninterrupted connection”! Every word must bring the reader closer to the purchase decision.

Images must also work in an integrated way with the text to create trust. Sharp, well-lit photos are essential to convey clarity and a perception of reliability. But what really makes the difference is showing the product in action, using the images following the main one. Customers must imagine using the solution you propose in their daily life. A video can explain in seconds what would otherwise require paragraphs of text.

Finally, it is worth remembering that the product page becomes the space to build credibility:

• telling the brand story
• comparing features with competitors
• proving why we are the best choice.

Renegotiation with suppliers

Tariffs have changed the rules of the game and created an opportunity that did not exist before. Many suppliers are seeing orders from the US decrease and know that market uncertainty could further reduce demand. A situation that, paradoxically, can put you in a stronger negotiating position.

The best approach is to present the current situation as a shared challenge to be solved together. Explain to your suppliers that tariffs are squeezing margins and making future volume decisions more difficult. It is therefore a matter of finding a solution that works for both. Suppliers could absorb part of the additional cost in exchange for larger orders or a more stable long-term collaboration.

If reducing the unit price is not possible, other ways can be explored to lower total costs. More favorable payment terms provide more liquidity, improved packaging reduces transport damage, and faster production times allow better response to demand fluctuations.

Meanwhile, you can obtain quotes from alternative suppliers, both in China and elsewhere. Even if you do not actually intend to switch, having concrete alternatives strengthens your credibility at the negotiating table and gives you the confidence to make decisions based on real options, not hopes.

Smart advertising in times of crisis

When costs increase, the temptation to cut advertising investments is strong. However, this is also one of the most expensive mistakes you can make. Advertising is not just an expense. It is the fuel that keeps the product visible and drives sales. Cutting it drastically means entering a dangerous spiral where less visibility leads to lower rankings, which in turn generate even fewer sales.

The secret is not to spend less, but to spend better. You need to become even more specific in campaign analysis, eliminating keywords that bring clicks but no sales, reducing spending on everything that does not generate real profit, and concentrating every euro on channels and strategies that deliver concrete results. The goal is no longer to generate maximum volume, but maximum profit for each euro invested.

Here comes into play an often overlooked element: the improvement of product pages, which amplifies the effectiveness of every advertising euro. When the product listing converts better, every visitor arriving through ads is more likely to buy. With the same budget, you can generate more sales, creating a virtuous circle where investment in optimization pays off by multiplying the effectiveness of ad spending.

>>> Also read our guide Amazon inventory management: guide to warehouse optimization <<<

Expansion into international marketplaces

When US tariffs begin to erode margins, looking beyond national borders can be a profitable path. Other markets could indeed offer more favorable conditions, with lighter tariffs or less fierce competition. In short, they allow you to recover the profitability lost in the United States.

For those already operating in the US, Canada and Mexico are the first natural step thanks to Amazon’s North America Remote Fulfillment (NARF) program, which greatly simplifies entry. The European Union offers even greater potential. Mature markets like Germany, France, Italy, and Spain, in addition to the UK, represent millions of consumers ready to buy products that may be saturated or too competitive in the US market.

Other international markets like Australia, Japan, and the UAE may seem smaller, but they often hide less crowded niches where it is easier to stand out and build a significant presence. Moreover, one of the advantages of these emerging markets is that they often allow you to test strategies and refine the offer before facing the tougher competition of the main markets.

In other words, global expansion has become a survival strategy because it diversifies risk. When one market becomes difficult, others can compensate for the losses and often become the springboard for growth beyond what you would have ever achieved by staying in one country.

Building a tariff-proof brand

While many sellers focus only on numbers and costs, those who build a strong brand have a crucial advantage. Loyal customers are willing to pay more for products they perceive as superior. The additional margin becomes the cushion that allows you to absorb tariff increases without having to sacrifice profitability or lose price competitiveness.

Differentiation does not happen by chance. It develops through a coherent strategy that touches every customer contact point, such as:

• the packaging they receive at home
• the descriptions they read online
• the way their problems are solved.

Every element must be geared toward one goal: telling convincingly who we are and why we deserve to be chosen over competitors. And for this, it is not enough to have a good product. Customers must immediately understand why we are the right choice for them.

The secret is to identify what truly makes our offer special. It could be a more elegant design, a feature solving a specific problem, superior materials, or simply a more pleasant shopping experience. What matters is that this difference is clear and important to target customers. When you can communicate this value clearly and consistently, tariffs become a problem only for competitors who compete solely on price.

Financial and operational management

When external shocks like tariffs arrive, often the difference between those who survive and those who fail comes down to how solid the company’s foundations are. That is why you need to know your numbers perfectly: how much each product really costs once it arrives, what the real margins are, how fast inventory turns, and how money flows in and out of the company.

Higher tariffs mean that every inventory order will cost more, tying up greater amounts of capital in goods. At the same time, if sales slow due to higher prices, that money stays tied up longer. Having sufficient cash reserves or access to reliable credit means being able to operate when margins are tight.

At the same time, every operational inefficiency that was once affordable now becomes a burden. Excess inventory means capital tied up unnecessarily. Unoptimized shipping costs further erode margins. Inefficient processes waste precious resources. Instead, operations must be kept lean, where every euro invested works at its maximum capacity, creating the flexibility that allows quick adaptation to market changes.

Monitoring and continuous adaptation

The tariff situation could change again. What seems insurmountable today could tomorrow become an opportunity—or simply disappear. Trade policies are notoriously volatile, often influenced by ongoing negotiations, political pressures, and changes in international relations. Reacting too quickly to every announcement can lead to decisions you regret.

Instead of rushing to adjust prices at the first sign of new tariffs, you can use this uncertainty period to strengthen your position. It is the ideal time to sit down with suppliers and negotiate better conditions, while they too are concerned about future orders. You can therefore focus on reducing real production and transport costs rather than automatically passing every increase on to customers, who might simply leave.

Think of this phase as a stress test for your business. Tariffs have the power to expose weaknesses: margins too thin, excessive dependence on a single market, inefficient processes that only worked when everything was smooth. But at the same time, they create opportunities for those flexible enough to adapt. While more rigid competitors struggle or quit, you can gain market share and emerge stronger than before.

>> Also read our article European production hubs: which are the best for your sourcing?  <<<

Long-term planning

Those who will not only survive but thrive in this period will be those able to see beyond the immediate crisis and seize the opportunities being created. While many sellers focus on problems, the more forward-thinking are using this phase to diversify income sources, expand into new markets, and build stronger foundations for the future. The difference lies in the approach. Instead of reacting emotionally, they develop strategic plans based on real data and build partnerships that make them stronger.

What we are experiencing is essentially an accelerated selection process. Tariffs are quickly bringing out all the weaknesses that previously remained hidden. Those who always relied on thin margins, low-quality supplies, or indistinguishable products are now in trouble. But this also means there is more room for those prepared to adapt and invest in resilience.

The market that emerges from this phase will inevitably be different, but also full of opportunities for those able to transform. Companies that use this moment to streamline operations, improve efficiency, and build stronger value propositions will find themselves in a position of advantage both in home and international markets. Change can be frightening, but it always brings the possibility to grow and become stronger than ever imagined.

The table with all strategies to adopt

STRATEGIC AREA	SPECIFIC STRATEGIES	ADVANTAGES	CONSIDERATIONS
🌍 Supplier Diversification	• Shift from China to Vietnam, India, Mexico, Turkey • Hybrid production (components from China + assembly in low-tariff countries) • Modular supply chains with multiple suppliers	• Reduced tariff impact • Lower geopolitical risk • Greater flexibility	• Long transition times • High initial investments • Need for quality checks
📋 Customs Classification	• Professional customs consulting • Product code optimization • Accurate documentation • Strategic reclassification	• 20–40% tariff reduction • Quick ROI • Amazon compliance	• Consulting cost • Regulatory complexity • Risk of penalties if incorrect
💰 Pricing Strategies	• Gradual increases (2–5%) • Buy Box performance testing • Strategic bundling • Product differentiation	• Maintained competitiveness • Absorption of tariff costs • Higher margins	• Risk of losing Buy Box • Need for continuous monitoring • Delicate balance
📦 Inventory Management	• Sophisticated planning (Amazon 90-day limit) • Carry cost balancing • Cash flow optimization • Lean inventory	• Lower storage costs • Better rotation • Less tied-up capital	• Stockout risk • Management complexity • Amazon restrictions
🎯 Conversion Optimization	• Surgical copywriting for listings • High-quality images • A+ Content as mandatory investment • Explainer videos	• Maximized traffic value • Higher margins per sale • Superior competitiveness	• Time/resource investment • Specialized skills • Performance monitoring
🤝 Supplier Renegotiation	• Strategic partnerships • Better payment terms • Larger orders for better prices • Multiple quotes as leverage	• Reduced unit costs • Better conditions • Strengthened relationships	• Possible supplier resistance • Need for guaranteed volumes • Time for negotiations
📢 Smart Advertising	• Audit of existing campaigns • Focus on converting keywords • Efficiency vs. volume • ROI-driven spending	• Maintained visibility • Better budget efficiency • Ranking preserved	• Risk of traffic reduction • Need for expertise • Constant monitoring
🌐 International Expansion	• Canada/Mexico (NARF) • EU (UK, DE, FR, IT, ES) • Australia, Japan, UAE • Geographic diversification	• New markets • Reduced dependence on US • Growth potential	• Initial investments • Regulatory complexity • Learning curves
🏷️ Brand Building	• Differentiation through branding • Unique product development • Consistent storytelling • Premium pricing capacity	• Resistance to price pressure • Customer loyalty • Higher margins	• Marketing investments • Time to build • Branding skills
💼 Financial Management	• Adequate cash reserves • Monitoring critical KPIs • Lean operations • Cash flow management	• Resilience to external shocks • Adaptability • Operational stability	• Need for capital • Financial discipline • Rigorous controls
📊 Continuous Monitoring	• Tracking tariff policies • Strategic adaptation • Business stress testing • Scenario planning	• Timely adaptation • Data-driven decisions • Anticipation of changes	• Dedicated resources • Information complexity • Expertise required