How Tariffs Are Impacting B2B Sales on Amazon
- daniel64901
- May 5
- 4 min read
Note: This blog post discusses a topic that is changing on a nearly daily basis. All information included here is up-to-date as of April 30, 2025. We will include updates as the topic evolves over time, either here or in subsequent articles.
Perhaps the most pressing issue that’s on the mind of B2B manufacturers these days is the impact recent tariffs are having on their business. The on-again off-again nature of the policy has created a sense of uncertainty among businesses, upending the way companies are sourcing products and materials.
Tariffs on imports like steel, aluminum, and critical minerals (e.g., rare earth elements) are driving up costs for industries reliant on these materials. For example, the unilateral 25 percent tariff on steel and aluminum imports has already raised production costs for manufacturers. And the hefty 145 percent base tariff on Chinese goods (with additional tariffs being applied based on sector) has led to a number of supply chain challenges, likely prompting firms to seek out alternative suppliers in other countries.
Current U.S. Tariffs against Its Top 5 Trading Partners (as of April 30, 2025)
Country | Tariff Rate (%) |
China | 125% (Additional tariffs apply in certain sectors) |
Mexico | 10% (Exemptions for select products under USMCA) |
Canada | 10% (Exemptions for select products under USMCA) |
European Union | 10% (20% additional tariff temporarily paused) |
Japan | 10% |
Despite the economic and financial uncertainty these tariffs have created, there may be opportunities for B2B manufacturers looking to bolster their bottom line. There is evidence that suggests that the tariffs may, in fact, have a material impact on the competitive landscape on Amazon.
But before we can make that case, it’s important to understand the pre-tariff competitive landscape. Particularly as it pertains to China-based sellers on Amazon.
China-based Sellers Flood Amazon
Chinese manufacturing has been providing the world with affordable products and raw materials for several decades now. Free trade agreements and other policies have dramatically bolstered China’s manufacturing sector, which today produces nearly 1/3 of all manufactured products in the world, nearly double what the U.S. produces.
Although Amazon had been open to third-party sellers since the early 2000s, it wasn’t until the 2010s when many China-based manufacturers started to sell directly to customers on Amazon while still providing manufacturing services to brand names. As of 2024, approximately 50 percent of the top Amazon sellers were based in China.
Using the Seller Central selling method, China-based sellers have been very good at competing against and winning market share from well-known brands. In many cases, the same factories that make products for U.S. brands also sell similar products under unknown brand names on Amazon. A prime example of this is the power bank manufacturer Anker. Founded in China, the company now brings in more than $2 billion in revenue, almost entirely through Amazon (though not exclusively).
While this trend has played out largely in B2C categories, the same dynamic has more recently heated up competition in B2B sectors on Amazon such as safety equipment, medical devices, industrial products, and others. Sadly, many B2B manufacturers have been asleep at the wheel and have lost significant market share on Amazon as a result. While Amazon doesn’t publicly share figures, one estimate puts China-based sellers at about “11 percent of enterprise brand revenue.”
New Opportunities on Amazon for U.S.-based Manufacturers
Consequently, the tariffs are likely having a major impact on these China-based sellers, both in terms of the revenues they generate for themselves as well as the advertising revenue they generate for Amazon.
The tariffs will force these sellers to make a choice: Either raise prices or pull out of Amazon altogether.
For those remaining on the platform, raising prices will have implications for sales. Remember that Amazon’s algorithms are weighted heavily to show lower priced items first. Raising prices will likely limit the visibility of China-based sellers’ product listings, causing fewer sales. What’s more, changes to pricing can reset a product listing’s standings in Amazon’s Buy Box on product listing pages, which contains the “Buy Now” and “Add to Cart” buttons that drive sales.
Beyond that, we believe that higher prices for Chinese manufactured products will also drive buyers to select products made by U.S.-based manufacturers. Although some China-made products will still be less expensive even with the tariffs, it’s important to keep in mind that buyers don’t only buy on price; they also consider factors such as quality, product and seller reviews, accompanying services, among others.
Finally, advertising on Amazon is another area where tariffs may give U.S.-based sellers an advantage. Amazon ads are similar to other cost-per-click advertising, such as Google AdWords. And because these ads are sold as a reverse auction, lower demand caused by fewer advertisers will likely reduce both prices afs well as competition to win higher search rankings in coveted categories.
A Window of Opportunity for Traditional Brands
The tariff situation is constantly evolving on a daily basis. Things are shifting quickly, which means the opportunities they create won’t last forever. That said, for now, U.S. sellers whose products are made in the U.S. have a significant opportunity to gain market share on the platform. At Enceiba, we're already seeing small bumps from our US-based clients as competition starts to thin.
If you’re a U.S.-based B2B manufacturer who’s been on the fence about selling on Amazon, now’s the time to act. Putting a successful Amazon program in place takes some strategic planning and expert execution, something that many firms don’t have in house. Turning to a top B2B Amazon consultant like Enceiba, though, can get you up and running faster, helping you to take advantage of the temporary advantages these tariffs are providing.