Marketplaces’ Third-Party Sellers to Face Full Impact of Tariffs in Second Half

The efforts of third-party sellers on platforms like Amazon to stock up on goods to avoid the cost of tariffs will reportedly work for only a limited time.

Because shoppers are also buying ahead to avoid the impact of tariffs, merchants will eventually sell down their inventory, place new orders, and be faced with the challenge of trying to avoid price increases, Reuters reported Friday (May 2).

Analysts interviewed by Reuters said that it is unlikely sellers can stock up on enough inventory to meet their needs for more than six months and that they will feel the full impact of tariffs in the third or fourth quarter.

As PYMNTS reported Thursday (May 1), Amazon CEO Andy Jassy said during the company’s quarterly earnings call that demand had not yet softened because of tariffs and that if anything, the company had seen “heightened buying in certain categories that may indicate stocking up in advance of any potential tariff impact.”

Amazon pulled forward inventory in the first quarter, while many marketplace merchants accelerated shipments to U.S. warehouses to insulate customers from price spikes.

Jassy added that Amazon’s risk is muted relative to rivals because many traditional retailers buy from middlemen who themselves import from China, “so the total tariff will be higher for these retailers than for China-direct sellers” on Amazon’s platform.

Walmart Chief Financial Officer John David Rainey said during a February earnings call that Walmart feels good about navigating tariffs and other uncertainties.

Rainey said Walmart’s playbook includes negotiating with suppliers, expanding private-label offerings and shifting sourcing to lower-cost regions.

“We can then pass on [savings] to consumers,” he said during the call.

It was reported Tuesday (April 29) that retailer CEOs who met with President Donald Trump warned that while their companies have kept prices low despite tariffs, the situation can’t last. They said it would be tough to avoid higher prices and some products could become scarce if retailers choose not to sell them due to tariff costs.

Nearly one in five small- to medium-sized businesses (SMBs) are pessimistic about their odds of survival over the next five years, according to the PYMNTS Intelligence report “Brewing Storm: Why 1 in 5 Smaller Businesses Without Financing Fear They May Not Survive Tariffs.”

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