Shopping has become a trade war zone, and consumers are caught in the crossfire.

On May 2, US president Donald Trump’s administration is set to eliminate the tax loophole known as de minimis, which exempts packages under $800 from duties, on goods from China and Hong Kong. A target of bipartisan legislators for years, de minimus has been particularly beneficial for Chinese e-commerce giants Shein and Temu, and the seismic shift would put a serious strain on their bottom lines. Already, both warned customers price hikes were coming April 25 due to rising operating expenses.

Of course, nothing is yet final; Trump’s trade policies are prone to rapid change. This week, the president suggested he would bring tariffs on China down substantially, saying: “We’re going to be very nice and they’re going to be very nice, and we’ll see what happens.”

But if the plan goes forward, the resulting pain will be felt beyond the two ultra-fast fashion leaders, with the potential to impact third-party sellers on Amazon and Walmart, other smaller online retailers that source from China, as well as “dupe” brands like Quince.

Still, the likes of Shein and Temu will feel its impact most acutely. It comes at an already precarious time for the two: Amid its ongoing fight to IPO, Shein’s annual profit slid by more than a third in 2024, the Financial Times reported in February, while in March, Temu parent company PDD announced it missed revenue estimates. Both rely on a constantly expanding customer base to grow, meaning they have to spend to recruit shoppers — but both slashed digital advertising spend last week.

The next few months will put their futures — and consumers’ appetite for ultra-cheap goods that are suddenly less ultra-cheap — to the test.

“A lot of companies will be impacted, but they are most impacted because deep discount is their biggest value proposition,” said Michael Maloof, growth strategist at Earnest Analytics.

What is happening now?

Shein shoppers are scrambling. The e-tailer’s Reddit page is brimming with questions about tariffs and how they work. Shoppers have become overnight logistics experts, documenting their packages’ every move, watching whether it will slip through before tariffs set in. Reactions range from mourning the last few hauls to calls for action: “Call your senators and representatives … they need to hear from us,” said a commenter.

“I guess we have to go back to Forever21,” said TikTok user @rachelandc, upset she missed her window for one more haul. (It’s too late for Forever21, too — the mall staple of yore filed for bankruptcy last month, unable to keep pace with Shein and Temu.)

Another TikTokker, @princessakaren, summed up the mood of the moment: “I don’t understand any of this. I just want to shop.”

Even Shein appears to be confused. Temu’s and Shein’s statements on price hikes last week were identical, puzzling because the two are competitors: “The Shein team is curious too. This was not coordinated, and the Shein customer notice posted first,” a source close to Shein told BoF. (Temu did not respond to a request for comment.)

Should prices jump and high tariffs be tacked on, there’s a real chance shoppers may cut back on Shein and Temu purchases in particular, because being super cheap is their main differentiator, whereas Quince, which takes advantage of the same loophole, has more of a value-for-money proposition, for example, said Maloof.

Spending on Shein and Temu decelerated in February, when Trump announced de minimis would close, but rebounded shortly after, according to Earnest Analytics credit card data. Shoppers appeared to begin stocking up again at the beginning of the month; Shein’s US revenue growth accelerated to 38 percent in the first 11 days of April while Temu saw 60 percent growth, Bloomberg reported. But over the past two weeks (April 8 to 21), Shein’s and Temu’s daily active users fell 5 percent and 25 percent respectively, according to intelligence firm Sensor Tower.

Many shoppers are likely taking a wait-and-see approach, said Katie Thomas, Kearney Consumer Institute lead. With the memory of TikTok’s near-shutdown still fresh, some may not believe change is coming.

“Consumers have gotten used to operating at this level of stress and uncertainty and these ongoing, unprecedented times,” said Thomas.

What’s next?

There’s evidence appetite for Shein is already waning. Purchase consideration, a measure of whether it’s top of mind for shoppers, dipped between March and April, according to intelligence company Morning Consult.

As tariff talk rises, TikTok views of content featuring thrifted fashion are up 375 percent compared the start of the year, and growing 8 percent per week, suggesting shoppers are pre-emptively seeking out other options as they ready for rising costs, said Michael Appler, communications director at analytics firm Trendalytics. Downloads of secondhand apps in the US jumped 18 percent on average quarter-over-quarter in the first quarter of 2025, according to Sensor Tower.

What comes next is a matter of how real things get for consumers, and some are bracing for the worst, said Thomas. As profits are pinched in the face of rising costs, layoffs could follow, which would dramatically impact spending. Though the labour market has held steady, Meta, Google, Intel and Coty have already culled their workforces this year.

Whether shoppers keep turning to Shein and Temu depends on how expensive things get and whether the value proposition stays intact for shoppers as prices and duties rise, said Maloof.

Caitlin Tetrault, a Florida-based TikTok Shop seller, said price isn’t the only motivating factor for buying from e-tailers like Shein and Temu; they have “cute things,” and stock them faster than anyone else. But she predicts there will be less of buying “18 outfits for Coachella that you don’t care if you leave in a tent behind you,” and she plans to cut frivolous spending, like buying and tossing extra sizes, herself.

Even if prices rise, the calculus for shoppers might be the same: “Until people decide Amazon is as expensive as Temu, Temu has some edge [because] the edge is just so big,” said Maloof. Same for Shein. “For a foreseeable amount of runway they’re still the best offer, as long as people are still shopping for it.”