$111.8 Billion dollars on Amazon comes from Chinese sellers. This looks like a lot of money paid in tariffs. But what if Chinese sellers actually pay less in tariffs than their US counterparts?

That's what's going to happen.

I sat down with the most successful Chinese seller in the world last week. He told me the tens of thousands Chinese sellers are more motivated to capture Amazon revenue.

CONTEXT
8 years ago, Chinese sellers were allowed to sell directly on Amazon. Gone are the days of US businesses buying manufactured goods. Chinese manufacturers bypass this and completely take over certain categories by pricing everyone out.
Catching up to today, they are the fastest growing segment. Although they have a reputation for playing by their own rules. Many have been suspended for review manipulation and competitor ASIN takedowns. This "ingenuity" will continue to play out as both reporters and US Amazon sellers are pointing out.

Here’s why Chinese sellers will pay less in tariffs:

1. Lower cost of goods. No middle man, lower basis. US sellers buying from China get the manufacturers margin in their tariff calculation.
2. Customs Fraud. As reported by Fortune, Chinese manufacturers are already playing this game. Reducing COGS is just the start.
3. Shift manufacturing to lower tariff countries. Making final assembly or modifications in a lower tariff country and they’ll avoid the big Trump tariff.

TAKAWAYS
Amazon has major shifts coming it’s way with the increase of tariffs. Chinese sellers will find clever ways to keep growing and winning the US marketplace.

There’s so much at stake and the US seller stand to get hurt a lot by what’s going on.