Amazon has canceled orders for various products from China and other Asian countries after the US announced new tariffs on over 180 countries and territories, including China, Vietnam, and Thailand.

The affected items include beach chairs, scooters, and air conditioners.

Vendors received little notice. One vendor said a US$500,000 order was canceled after production was completed, forcing them to cover factory costs and find new buyers.

The cancellations impact Amazon’s direct import orders, where the company pays the tariffs. Now, vendors may face the tariff burden if they import goods on their own.

Amazon declined to comment, but its annual report had listed international trade disputes as a risk.

🔗 Source: Bloomberg

🧠 Food for thought

1️⃣ Amazon’s abrupt cancellations exemplify the swift supply chain shifts during trade tensions

Amazon’s cancellation of orders from Chinese suppliers without warning demonstrates how quickly major retailers can pivot their supply chains when faced with tariff increases.

The beach chair vendor’s experience of having a $500,000 order canceled after manufacturing was complete shows the severe financial impact these rapid adjustments can have on suppliers 1.

This pattern of sudden supply chain disruption is consistent with how other major retailers have responded to previous tariff announcements, as companies like Walmart have also adjusted their forecasts and strategies in response to tariff concerns 2.

The timing of Amazon’s cancellations, immediately following Trump’s April 2 tariff announcement, illustrates how trade policy can trigger almost instantaneous changes in procurement strategies, particularly for “direct import orders” where Amazon would be the importer of record responsible for paying tariffs 3.

Historical U.S.-China trade data shows the relationship’s significance, with $582.4 billion in goods traded in 2024 alone, explaining why retailers react decisively to potential disruptions 4.

2️⃣ Strategic tariff burden-shifting reveals retailer-vendor power imbalance

By canceling direct import orders, Amazon has effectively shifted the tariff burden back to vendors, highlighting the asymmetric power dynamics in e-commerce supply chains.

As consultant Scott Miller noted, “Amazon really holds all the cards,” leaving vendors with limited options: sell inventory in other countries at lower margins or work with other retailers 1.

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