Kinh Bac City in Vietnam claims 99% ownership of Trump International Vietnam through its subsidiary

Kinh Bac City in Vietnam claims 99% ownership of Trump International Vietnam through its subsidiary

In the ever-evolving landscape of international trade, the recent announcement of potential new tariffs on Vietnamese imports by former President Trump has sparked significant concern among ecommerce businesses and investors alike. Trump's proposal, if implemented, could have profound implications for both sectors, particularly for ecommerce brands that source products from Vietnam and investors with stakes in the country's manufacturing sector.

Trump's Proposed Vietnam Trade Policies

Trump's latest trade policy proposal, announced on July 2, 2025, involves imposing tariffs on Vietnamese goods. The proposed tariffs range from 20% to 40% depending on the origin of the goods. In exchange, Vietnam is expected to open its market to U.S. products at zero tariffs. However, the Vietnamese government has yet to formally accept these terms, raising questions about the agreement's validity [2].

Impact on Ecommerce Brands

Ecommerce businesses that rely on Vietnamese manufacturers for sourcing products are particularly vulnerable to these potential tariffs. According to the U.S. Census Bureau, U.S. imports from Vietnam have more than doubled since 2018, reaching over $127 billion in 2022, indicating the country's growing importance in global supply chains, especially for ecommerce businesses seeking competitive manufacturing costs [1].

The impact of these tariffs could be significant for different types of ecommerce operations:

1. Dropshipping Businesses: Dropshippers who source products directly from Vietnamese manufacturers or suppliers would likely see reduced profit margins as suppliers pass along tariff costs. Additionally, potential shipping delays due to new customs regulations could disrupt operations.

2. Inventory-Based Retailers: Businesses maintaining inventory would face higher carrying costs and potential cash flow challenges when pre-paying for tariffed goods. Stocking up before tariff implementation could be an option, but recalculating optimal inventory levels based on new cost structures would be necessary.

3. Private Label and Custom Product Brands: These brands may face the most significant challenges, including renegotiating manufacturing contracts, reformulating products to reduce costs, and considering manufacturing relocations to other countries.

Preparing for Potential Tariffs

While the outcome of the 2024 election and subsequent trade policies remain uncertain, prudent ecommerce operators should begin considering contingency plans now. Strategies include:

1. Diversify Supply Chain: Developing relationships with manufacturers in multiple countries to reduce dependency on any single source.
2. Build Tariff Costs into Pricing Strategy: Examining current pricing structures to determine how much of potential tariff costs could be absorbed by margins and which product categories might need price adjustments.
3. Improve Operational Efficiency: Finding cost savings elsewhere in the business, such as optimizing fulfillment and shipping processes, reducing return rates, and implementing automation to reduce customer service costs.
4. Communicate Transparently with Customers: If tariffs materialize, transparent communication about price changes and product availability will be essential.

Investor Implications

For investors, the proposed tariffs could affect the valuation of companies with significant operations in Vietnam. The uncertainty surrounding the agreement and the potential for higher costs could lead to volatility in the stock prices of these companies. Investors should monitor the developments closely and consider diversifying their portfolios to mitigate risks.

Conclusion

The potential for new Vietnam tariffs in 2025 creates uncertainty for both ecommerce businesses and investors. However, proactive planning can help mitigate risks. Ecommerce brands should focus on supply chain diversification, flexible pricing strategies, operational efficiency, and transparent customer communication. Investors should closely monitor the situation and consider portfolio diversification. By staying agile and prepared, businesses and investors can navigate the uncertain trade environment effectively.

References

[1] https://www.trychad.com/blog/trump-s-vietnam-trade-deal-how-2025-tariffs-could-impact-ecommerce-brands
[2] https://www.politico.com/news/2025/07/10/vietnam-trump-tariff-deal-00447715