Will Trump's tariffs force K-beauty products out of US?
What's the story
The United States has imposed a 15% import tax on South Korean goods, including popular K-beauty products. The move, announced by US President Donald Trump, has raised concerns among consumers and retailers alike. Despite the tariff being lower than the initially proposed 25%, it is expected to impact prices across the industry. Will K-beauty revenue take a hit at the hands of Trump?
Continued demand
K-beauty's growing popularity in the US
K-beauty products, which include a range of skincare and cosmetics from South Korea, have become increasingly popular in the US. Americans spent $1.7 billion on these products in 2024, a 50% increase from the previous year, according to the BBC. Despite potential price hikes due to tariffs, economist Munseob Lee believes K-beauty will continue to be in demand because "fans won't find an easy substitute."
Price adjustments
Retailers stock up amid uncertainty
Retailers like Sante Brand and Senti Senti have seen a spike in orders as consumers prepare for the uncertainty of rising prices. Cheyenne Ware, founder of Sante Brand, said customers are "strategic with how they were going to weather the storm." Winnie Zhong from Senti Senti also received alerts from suppliers urging retailers to "stock up before tariffs."
Cost absorption
Larger brands better positioned to absorb costs
Larger K-beauty brands are in a better position to absorb the cost of tariffs due to higher profit margins. South Korea-based business consultant Eyal Victor Mamou said these companies can avoid major price increases for customers. However, smaller firms that manufacture in South Korea may struggle with rising costs, as most goods sold now were commissioned at current prices.
Trade impact
Limited alternatives for consumers
Trump's trade policies have also affected Japan and the European Union, which now face similar tariffs on exports to the US. However, it remains unclear if this will lead US consumers to switch to American-made beauty products. Pearl Mak, a graphic designer who prefers K-beauty products for their effectiveness, said she hasn't found American alternatives as effective. Do you use Korean beauty products?