Christmas Shopping Season in Peril? US Retailers Sound Alarm
Panic! US Importers and Retailers Brace for a Christmas Without Presents?
Imagine a holiday season with bare shelves and inflated prices. That’s the chilling prospect facing American shoppers as retailers grapple with the fallout from potential tariffs on goods, particularly those from China. The uncertainty surrounding the trade landscape has thrown holiday planning into disarray, leaving businesses and consumers in a state of high anxiety.
For US manufacturers, importers, and retailers, strategizing for the first holiday season under the shadow of potential tariffs feels like navigating a minefield. Will tariffs be reduced by then? Or will they disappear altogether? The truth is, no one knows. This ambiguity is the only certainty as the crucial Christmas shopping season looms.
Industry executives and analysts are sounding the alarm, warning that America could be heading towards a Christmas with fewer goods, higher price tags, and potentially empty spaces where coveted gifts should be.
Even President Trump himself acknowledged the potential impact. Speaking to reporters after a cabinet meeting on April 30th, he suggested his trade dispute with China could lead to sparse toy store shelves. “Well, maybe kids will have two dolls instead of 30, you know?” he mused, adding, “And the price of those two dolls will be a couple of bucks higher.”
The Toy Association, representing 850 toy manufacturers, isn’t taking this lightly. CEO Greg Ahearn told The New York Times that the current supply chain freeze poses a significant risk to Christmas. “If we don’t get production back online quickly,” Ahearn stated, “there’s a very real possibility of toy shortages this holiday.”
Experts agree that the damage may already be done, even if tariffs were to be lifted immediately. “The supply loss has already occurred,” noted James Zahn, editor-in-chief of the industry publication The Toy Book. “You’re going to start seeing weird glitches in the supply chain.”
Holiday Orders Taking a Hit
American retailers are hitting the pause button on their usual holiday preparations, waiting to see how the tariff situation unfolds. This indecision is disrupting established timelines and creating a bottleneck in the supply chain.
Jonathan Gold, vice president of supply chain and customs policy at the National Retail Federation, warned in a statement that the impact on retail inventory could become apparent in the coming months as goods subject to higher tariffs begin to arrive. “The uncertainty surrounding tariffs is a challenge for businesses, particularly small businesses that are currently preparing for critical winter holiday orders.”
Companies heavily reliant on the holiday season, like toy manufacturers, face a potentially disastrous year if tariffs remain high. For giants like Mattel and Hasbro, the holiday season typically accounts for a staggering 25% to 30% of their annual sales, according to Bloomberg.
Zahn explained the typical holiday toy shipment schedule: goods usually start leaving China in June, arriving at major retailers by August or early September for the crucial fall restocking. However, production lines are now stalled, and orders are in limbo, creating a ripple effect that threatens to intensify as the year progresses.
“Every day of disruption or pause in production or transit creates a multi-day ripple effect that gets worse and worse and worse as we get to the end of the year and hits everyone hard,” Zahn emphasized. “What should be happening now is holiday goods should be going into production ASAP to start shipping in early June.”
Owen Carr, chief marketing officer at e-commerce accelerator Spreetail, believes that fulfilling almost any order from China is becoming untenable. “If you think the tariffs are going to drop from 145% to 50%, you definitely don’t want to be the schmuck who imported at 145% because you’re never going to get that money back,” he pointed out.
CNBC reports that Chinese factories, originally producing goods for the US market, have already begun pivoting to new customers since the 145% tariff went into effect. “The repeated refrain I’m hearing is, ‘We had the boxes packed, ready to go,’” Carr said. “Now they’re unpacking them, reconfiguring parts, getting ready to ship to Europe, getting ready to ship to Canada.’”
Sari Wiaz, owner of baby toy brand Baby Paper, recently placed an order that’s now subject to a 54% tariff announced in early April – just before the rate skyrocketed to 145%. This single tariff added an unbearable $10,000 in shipping costs. Consequently, she’s halted all new inventory orders to avoid the even higher tariffs. “If we were to fully restock, that number would be completely untenable for us,” she explained.
Wiaz has also put planned marketing investments on hold and is turning down new wholesale orders. “I have a pile of orders sitting here that I’ve had to tell people I can’t fulfill,” she lamented. “We’re going to run out of product soon.”
Richard X. Zawitz, founder and CEO of fidget toy maker Tangle Creations, has suspended all orders for one of his main product lines. Despite strong sales of his “Nightball” toy on platforms like Amazon, the soaring costs due to tariffs mean the product is no longer economically viable.
While Tangle is large enough to absorb some of the costs, Zawitz warns that most small companies cannot. “This is very, very bad for our industry,” he stated bluntly. “There will be no Christmas this year. The shelves will be relatively bare.”
The impact of Trump’s trade war extends beyond just this holiday season. Rick Woldenberg, CEO of Learning Resources, anticipates his company will launch only half the usual number of new products in 2026, and even those that make it to market will have simpler designs. “We were poised to develop [these products], and now we can’t,” he said. “They’ve stymied us; they’ve put a kibosh on us.”
Rethinking Promotions from Prime Day to Black Friday
Spreetail’s Carr suggests that brand executives currently view their existing inventory as highly valuable. As a result, he predicts fewer promotions in the coming months and potentially later in the year, depending on how the situation unfolds.
Carr anticipates that brands will begin raising prices on China-originating goods by 10% to 40% around May 15th, when he expects their pre-tariff inventory to be depleted or severely constrained.
“The biggest pressure everyone’s feeling is that everything’s going to get 10% to 40% more expensive in May, and nobody knows how consumers are going to react,” Carr said. “Are they going to buy nothing? Are they going to buy half as much? That’s probably the biggest unknown right now.”
Reuters has reported that some brands are already pulling out of Prime Day. “The most unique thing about tariffs this year is how brands will rethink the use of promotions,” noted Brett Bonner, senior vice president of strategy at e-commerce analytics company PriceSpider, which works with over 2,000 brands on their marketing strategies. “This is unprecedented, and they have to consider all the variables to ensure they get their strategy right this year.”
Carr believes there’s still a window of opportunity for the holiday season – if a tariff resolution can be reached by mid-July, bringing rates down to 10% to 30%. He suggests that getting tariffs down to 50% by then would be very difficult. If no resolution is reached at all, he echoes Trump’s sentiment: kids may indeed only receive a couple of toys this year instead of, say, 20. “And they’re going to be expensive.”
Bonner raises a contrasting concern: brands might now be overstocking inventory and could be forced to rely heavily on promotions as the holidays approach.
“There’s a lot more planning happening than ever before,” Bonner stated. “Some of that preparation includes SKU rationalization, understanding where they should hold inventory versus buy online, pick up in-store. Additionally, they’re partnering more deeply with retailers that can help them weather the storm, such as bundling and exclusive packaging, and really getting creative about how they pass along different price increases to different brands rather than just a blanket price hike.”
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