- Sales for Shein and Temu slowed after Trump announced tariffs and de minimis changes.
- Shein's sales growth dropped significantly.
- The de minimis loophole remains open — for now.
Shein and Temu's sales slowed in the weeks after Trump announced tariffs and said he would close the de minimis loophole, February data from Earnest Analytics showed.
Shein seemed to take more of a hit than Temu. Between the weeks that ended February 1 and February 22, its sales growth slowed from 22% year over year to 9.6% year over year.
Temu's sales also decelerated, though at a slower rate, from 15.4% to 14.4%, which Earnest's head of marketing, Michael Maloof, said was in line with its usual weekly fluctuations. Earnest analyzes debit and credit card transactions from millions of US consumers.
By the week of March 1, Shein's sales growth was back up to 21.4% year over year.
The ups and downs demonstrate how closely US consumers are watching the news cycle — and could be a preview of what's to come when the Trump administration ends de minimis shipping for good.
"Nothing materially changed from an import perspective for Temu and Shein during February, and yet customers made fewer transactions during that period," Maloof told Business Insider. "The later recovery suggests this pullback could have been more news-driven than fundamentals-driven."
Representatives for Temu and Shein did not return a request for comment from BI.
The weeks when Shein's sales decelerated coincided with a series of whiplash moves in global trade.
In early February, Trump issued an executive order closing the de minimis loophole while imposing tariffs on China, Canada, and Mexico. (The administration has since rescinded some of the tariffs on Canada and Mexico). De minimis, also known as Section 321, is a provision of US customs law that allows retailers to import goods duty-free as long as they are valued at less than $800 and sent directly to customers.
The announcement that de minimis shipping would no longer be allowed sent much of the retail world into chaos. While Shein and Temu's use of de minimis brought the provision into the mainstream, many other brands selling directly to consumers also use the loophole to find cost savings.
US Customs and Border Protection said in a January press release that de minimis shipments increased by more than 600% from fiscal year 2015 to fiscal year 2023, going from 139 million a year to more than 1 billion. More than 1.36 billion shipments were sent via de minimis in fiscal year 2024, according to CBP.
Just a few days after the executive order was issued, Trump issued a follow-up order saying that the loophole would remain open until customs officials could establish a new process for collecting duty on packages sent using the provision.
Logistics experts expect de minimis to go away soon, though the exact timing is still unclear.
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