Amazon sellers are opting out of this year’s Prime Day, a significant shopping event typically marked by steep discounts. This decision comes as many sellers face uncertainty due to President Trump’s tariffs, particularly a hefty 145% tariff on products imported from China. As a result, many merchants are choosing to skip the mid-July event, which usually attracts a lot of customers.
According to a Reuters report, sellers who manufacture their goods in China are feeling the financial strain. The tariffs are squeezing their profit margins, making it challenging to offer the discounts that Prime Day is known for. Arun Sundaram, an analyst at CFRA Research, noted that while Amazon itself is likely to be fine, third-party sellers are the ones who will suffer the most from this situation.
Steve Green, an Amazon vendor who sells bicycles and skateboards made in China, mentioned that this is the first time he is skipping Prime Day since 2020. He explained that the tariffs would more than double his costs, making it impossible to participate in the discount event. Similarly, Kim Vaccarella, CEO of Bogg Bag, has decided to hold back her inventory for retailers like Macy’s and Bloomingdale’s instead, where she can sell her products at full price.
The ongoing trade tensions have forced some sellers to halt production and consider relocating their manufacturing to countries like Cambodia and Vietnam, which currently face lower tariffs. While these nations are subject to a 10% levy, it is significantly less than the rates imposed on Chinese goods.
Despite the challenges faced by sellers, Amazon reported a strong response from other partners looking to participate in Prime Day. They noted that prices for many items on their platform have remained stable, aside from typical fluctuations. However, the participation of third-party sellers is crucial, as they accounted for nearly 62% of units sold on Amazon in the last quarter.
The Prime Day event is optional for vendors, but Amazon invests heavily in promoting it, providing sellers with a chance to reach a larger audience. However, the requirement for significant discounts can cut into profits. Many sellers are now uncertain about their pricing strategies and whether they can afford to participate.
Jon Elder, who advises over 100 Amazon sellers, shared that nearly all of his clients are reducing their Prime Day deals due to the tariffs. Michael Slate, who runs a home goods company, echoed this sentiment, explaining that the uncertainty around product costs has disrupted his usual preparations for the event.
Rick Sliter, CEO of MedCline, which sells therapeutic pillows, also expressed his concerns. He noted that last year, Prime Day was a major success for his business, generating sales significantly higher than average. However, with ongoing tariff issues, he feels that discounting is no longer a viable option.
As the situation develops, it remains to be seen how many sellers will ultimately participate in Prime Day. Amazon has yet to announce the specific dates for this year’s event, but the impact of tariffs on sellers is already shaping the landscape of this popular shopping holiday.