HOW WILL THE VIETNAMESE E-COMMERCE SECTOR BE AFFECTED FOLLOWING THE U.S. IMPOSITION OF A 46% TARIFF?
What Retailers Are Concerned About, What Will Be Affected Vietnam's Retail - E-Commerce Industry?
The US imposes a 46% tax on goods from Vietnam, especially affecting businesses exporting goods to the US, including the Cross-Border E-Commerce sector. This also has some impact on the Domestic Retail Industry
Here are the main impacts (partly according to Trendsetter Marketing):
1. ECOMMERCE CROSS-BORDER ENTERPRISES IN VIETNAM ARE THE MOST AFFECTED
Businesses selling across borders on platforms like Amazon, Shein, etc. are most affected by the issue of heavy tariffs.
2. FDI ENTERPRISES MAY LEAVE VIETNAM
Some FDI companies using Vietnam as a production base for export to the US may leave → advertising revenue from this customer group will be at risk of a significant decrease.
Brand promotion campaigns, labor recruitment, B2B events may also be affected.
-> Labor trends may shift to domestic retail industries
3. MOST IMPORTANTLY, THE TREND OF SHIFT TO THE DOMESTIC MARKET HAS A GREAT IMPACT ON THE DOMESTIC E-COMMERCE MARKET
When exports are difficult, businesses can boost domestic consumption. It is forecasted that in the domestic market, the number of competitors in the same industry will tend to increase, increasing the competition density for the domestic advertising market. This competition will create no small pressure on the domestic e-commerce market. Shops will need to invest more in the quality of domestic products.
SEE MORE CONSUMPTION DATA ON E-COMMERCE PLATFORMS IN THE FIRST QUARTER OF 2025 BELOW
4. GROUPS OF PRODUCTS AFFECTED BY TAXES:
According to analysts, the reciprocal import tax rate announced by President Donald Trump in the early morning of April 3 (Vietnam time) will have a strong impact on the electronics, machinery, textile, footwear and wooden furniture industries of Vietnam...
Computers and electronic components are one of the product groups with the highest export rate to the US market.
According to Metric Analytics, the Computer and Electronic Components Group recorded sales of 1930.4 billion and sales of more than 12.8 million
SEE MORE COMPLETE DATA ON MORE THAN 20 PRODUCT GROUPS ON E-COMMERCE PLATFORMS IN THE FIRST QUARTER OF 2025 BELOW
5. WHAT DO BUSINESSES NEED TO DO TO ADAPT?
According to Trendsetter Vietnam, We Need to:
✅ Re-evaluate Target Markets: If we are too dependent on the US, we need to quickly look for alternative markets.
✅ Differentiate Brands & Products: Businesses can target niche markets instead of competing directly with big brands to avoid being caught up in price wars.
✅ Position and Reposition Brands Stronger: Enhance storytelling & branding to retain old customers and attract customers in new markets, avoiding direct price competition. Along with that, adapt and adjust content and message strategies to suit each region.
✅ Exploit Domestic Markets: If exporting is difficult, focus on domestic customers.
✅ Use AI & technology to optimize advertising campaigns: Leverage First-party Data to optimize campaigns combined with applying AI Chatbot to support customers and increase conversion rates.
46% for goods from Vietnam
"This is our declaration of independence," US President Donald Trump emphasized during a ceremony in the Rose Garden of the White House in the early morning of April 3, Vietnam time. The US leader held up a board detailing each reciprocal tax rate that will be applied to dozens of economies, including Vietnam.
The "basic" tax rate applied to all goods imported into the US is 10%. Some countries in this group include the UK, Brazil, Singapore, Australia, Chile, Argentina, Saudi Arabia, etc.
The European Union (EU), Malaysia, Japan, South Korea, and India are subject to tax rates of 20 - 26%. Notably, China and Vietnam are in the group subject to the highest reciprocal tax rates, 34% and 46%, respectively
- According to Báo Tuổi Trẻ Online
E-commerce Market Data Provided by Metric Analytics
Data on Computer and Electronic Components Groups of 5 E-commerce Platforms