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Trade war

Amazon sales data shows tariffs hit US vendors harder

Supply chain flexibility gives Chinese sellers easier time amid trade war

U.S.-based Amazon sellers are seeing weaker sales than their Chinese counterparts amid the trade war.   © Getty Images

NEW YORK -- U.S. tariffs have cost American vendors on Amazon more than their Chinese counterparts as a bitter trade war drags on between the two countries, a new analysis has found.

U.S.-based Amazon sellers, compared with those in China, are seeing a steeper tariff-correlated slowdown -- and more recently, decline -- in sales volumes, according to SellerMotor, a data analytics company servicing vendors on the American e-commerce site. 

The data, sampling over 2 million Amazon sellers' U.S. sales, gives insight into the trade war's effect on small and medium-sized businesses in both countries, as Washington and Beijing this month returned to another round tit-for-tat tariffs.

In the month ending July 18, 2018, Chinese and American sellers logged a 174% and 124% increase, respectively, from the year before. As the Trump administration implemented the first few rounds of tariffs against China starting early July, Chinese vendors managed to maintain a 111% growth rate in the month ending September 18, while U.S.-based vendors' growth rate fell more than half to just 54%.

As more rounds of American tariffs were added on, U.S. sellers recorded lower sales volumes compared with the year before for the most of 2019, while Chinese sellers grew sales volumes at a moderate pace.

While both sides are affected by U.S. tariffs, Chinese sellers "usually have better control over their supply chain," Sibiao Chen, COO of SellerMotor, told the Nikkei Asian Review. 

"They have better relationships with their suppliers," Chen said. "They can get more flexible account periods. They might get better prices. I have seen a lot of cases where our clients were able to persuade their supplier to take on 50% of the tariff."

While some of SellerMotor's Chinese clients have found supply chain alternatives in countries like Vietnam and Cambodia, those that distribute less fungible goods are mostly staying put, he added.

U.S. President Donald Trump has repeatedly said that China is paying "billions of dollars" in tariffs to the American government. Research from organizations including the International Monetary Fund suggested that the levies were "almost entirely" borne by U.S. importers and consumers.

Early this month, Trump slapped additional tariffs on the remaining $300 billion of Chinese goods, blaming Beijing's slowness to fulfill promises to buy agricultural goods among other issues. Beijing retaliated by announcing tariffs on $75 billion of American imports. Trump last week said the U.S. will further raise tariff rates on both existing and planned levies on Chinese goods.

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