How Implementing Resale Can Help Your Brand Offset New Tariffs

The ongoing trade war between the United States and major overseas manufacturing countries has created major uncertainty around the future of supply chains for apparel and footwear brands. 

Currently, all imports to the US are subject to a 10% tariff, while goods from China — the primary target of the federal government’s retaliatory tariffs — carry a minimum duty of 145% upon entering the country. The recent tariffs disproportionately affect clothing and textiles, with consumers facing 87% higher shoe prices and 65% higher apparel prices in the short-run, according to an analysis from The Budget Lab at Yale University. In the longer term, shoes and apparel prices are expected to stay 29% and 25% higher than before the tariffs. 

While it’s difficult to predict how trade talks will develop in the coming months, volatility has become part of the day-to-day business of consumer-focused brands. Pandemic-induced inflation and supply chain shortages, rising interest rates, and the recent tariffs prove that companies need to diversify their business models and hedge against cost swings in the supply chain. 

“This is a scary moment for brands; even if the tariffs get completely reversed, there is still huge uncertainty around the future of trade,” said Emily Gittins, Archive’s co-founder and CEO. “Brand-owned resale is an avenue for innovation in this moment of turbulence and chaos.”

During the pandemic, brands that quickly went digital and expanded online offerings got ahead of their peers. Now, the companies that can find ways to generate revenue without relying solely on overseas manufacturing will be the ones positioned for success.

Here are three ways a brand-owned resale program can offset the impact of tariffs:

• Resale platforms allow brands to create a profitable revenue stream from items already in the US, shielding them from tariffs entirely. Rather than scramble to find a zipper manufacturer that’s not based in China or pay duties to import denim fabric from abroad, brands can generate revenue from products that are sitting idle in brand warehouses or customer closets throughout the US. 
• Resale doesn’t just protect brands from higher production costs, it also helps them add and retain customers who are becoming increasingly price sensitive amid economic uncertainty. More than half of shoppers say that if new government policies around tariffs and trade make apparel more expensive, they will seek more affordable options like secondhand, according to a March report from ThredUp. 
• Resale programs also help brands meet customer demand for a new kind of shopping: The resale market grew five times faster than the broader apparel market in 2024, according to the ThredUp report.

Brands that don’t manage their own resale channels risk losing price-sensitive customers to third-party marketplaces. Even in a tough market, resale is a resource-light way to grow both top and bottom line quickly and sustainably.

“Resale isn’t just a nice-to-have,” Gittins said. “In today’s climate, it might be your strongest hedge.”