For consumers, the Vietnam trade resolution gives short-term relief: direct imports will be taxed at 20%, not at the previously threatened 46%, helping to prevent sudden price spikes at retail.
However, global brands like Nike, Lululemon, Under Armour—and especially small to mid-size apparel makers—face uncertain margins if they are forced to absorb the 40% transshipment penalty due to Chinese input content.
“Margins could fall by 3–5% or even 12–20% in some cases,” said UBS strategist Jay Sole, based on analysis of components costs and supply chain exposure. Smaller retailers with less bargaining power appear most vulnerable.
Additionally, manufacturers may attempt to reshore production or relocate sourcing to avoid tariff triggers—but this shift may increase costs, cause operational delays, and complicate inventory management.
Consumers are not entirely off the hook: some price increases may trickle through, especially in mid-tier apparel and footwear segments. But long-term, a more transparent tariff regime may lead to fewer surprises and better planning for all stakeholders—from factory workers in Vietnam to shoppers in America.
