Diversification in Times of US Uncertainty: A Cross-Border Perspective

For years, the United States has been a cornerstone market for Australian ecommerce. However, shifting trade policies, increasing tariffs, and growing logistical complexities are making it more difficult to sustain a stable presence. As a global cross-border logistics provider with expertise in navigating complex customs environments, including Section 321 and Type 86 entries into the US, SEKO Logistics has observed the mounting challenges firsthand and is actively monitoring policy shifts to support clients.

Recent regulatory changes and extreme policy volatility in the US have significantly impacted trade, particularly with China. In early 2025, the US administration initiated a rapid escalation of tariffs on Chinese imports. What began as an additional 10% tariff on February 4 quickly rose to 20% by March 4. Through a series of further increases under the International Emergency Economic Powers Act (IEEPA) and reciprocal actions, this culminated in a total cumulative tariff burden of approximately 145% on most Chinese goods by April 10, 2025.

Simultaneously, the administration targeted the de minimis exemption (Section 321), which allowed shipments valued under $800 USD to enter the US duty-free – a mechanism heavily used by ecommerce platforms shipping directly from China. The exemption for China and Hong Kong was abruptly eliminated on February 4, causing immediate logistical chaos, before being temporarily reinstated on February 5 to allow customs authorities time to adapt. However, the exemption was definitively ended effective May 2, 2025). From that date, low-value postal shipments from China/Hong Kong faced new duties (escalating rapidly in April to 120% ad valorem or a US$100+ per-item fee), while other shipments became subject to standard import procedures and the prevailing high tariff rates.

While initial reports of massive, specific package backlogs solely due to these February policy changes are difficult to substantiate against broader port data showing seasonal dips and congestion from other factors, like shifting carrier alliances and weather, the administrative disruption was significant. The extreme volatility and unpredictability of these policy shifts underscore the risk of over-reliance on the US market.

The Need for Market Diversification

Australian retailers are now actively pursuing alternative markets, aligning with the implementation of the Australia-UK Free Trade Agreement’s ecommerce provisions and the expansion of ASEAN digital trade frameworks. SEKO Logistics has been at the forefront of enabling brands to navigate these shifting landscapes, ensuring smooth transitions into new markets with reliable logistics and compliance solutions.

Consumer Behaviour and the Impact of Trade Barriers

Cross-border trade has become increasingly complex, particularly as consumers are highly sensitive to unexpected costs. Studies indicate that high extra costs (including shipping, taxes, and fees) are the primary reason for cart abandonment, cited by 48% of shoppers who abandon their carts during checkout. A further 21% abandon because they cannot see or calculate the total order cost upfront.

With regulatory changes like the de minimis elimination significantly increasing the landed cost of goods from China, retailers relying solely on outbound orders to the US from Chinese sources face customer dissatisfaction. Major ecommerce platforms such as Temu and Shein, heavily reliant on the previous de minimis rules, faced immediate cost pressures, with vendors reporting demands for 30% levies in February 2025 to cover anticipated duties. Analysis showed a deceleration in active customer growth for both platforms during the period of tariff uncertainty in February. The eventual imposition of high tariffs and the loss of duty-free status inevitably led to significant price increases for consumers on these platforms. This shift in consumer cost sensitivity signals an urgent need for retailers to explore more stable, cost-effective alternatives.

Strategic Expansion Opportunities

United Kingdom: The UK presents a compelling market. Recent figures suggest the UK online retail market was valued around £127-£130 billion in 2024. It remains the third-largest global ecommerce market. The number of ecommerce users is substantial, projected to reach approximately 62.1 million by 2025. Mobile commerce is dominant, accounting for roughly 63% of all UK ecommerce sales in 2024. The predictable UK customs regulations, VAT system, and the Australia-UK Free Trade Agreement offer retailers a potentially smoother entry point compared to the recent US volatility. SEKO Logistics has helped many Australian brands optimise their supply chains for UK expansion.

Europe: Europe also provides a viable diversification strategy. The broader European B2C ecommerce market reached approximately €887 billion in 2023, with forecasts suggesting growth towards the €800-900 billion range by 2028. Germany and France are the largest individual markets within the EU. Cross-border trade is highly significant, accounting for an estimated 37% of the total European ecommerce market value, indicating strong consumer openness to foreign brands. The Import One-Stop Shop (IOSS) system aims to streamline VAT collection on shipments under €150, potentially reducing compliance burdens and helping maintain competitive pricing for Australian retailers.

Singapore: Singapore has emerged as a strategic ecommerce hub in Asia. While market size estimates vary, some place its value around US$18 billion in 2024, with strong growth potential. Ecommerce user penetration was estimated at 58.8% in 2024, projected to grow significantly. Mobile commerce is extremely prevalent, with 83% of online shoppers using their mobile phones for purchases. Enhancements to the Singapore-Australia Digital Economy Agreement have simplified data flows and digital trade, making it an attractive gateway for Australian retailers expanding into Asia. SEKO Logistics has been instrumental in guiding businesses through regional fulfilment solutions to capitalise on this high-growth market.

New Zealand: Closer to home, New Zealand remains a natural extension. Online spending reached over NZ$6.09 billion in 2024, a 5% increase from 2023, driven by a 13% rise in transaction volume even as average basket size decreased. Forecasts suggest continued growth. Nearly 2.2 million Kiwis (around 50% of the age 15+ population) shopped online in 2024. While specific data on the percentage purchasing directly from Australian brands requires updating, the close ties and Trans-Tasman regulatory alignment simplify logistics and compliance, making it a cost-effective expansion choice.

Future-Proofing Cross-Border Ecommerce Strategies

As global trade conditions continue to evolve, diversification is essential for mitigating risks and ensuring long-term success. While the US remains a significant market, the demonstrated policy volatility highlights the dangers of over-reliance. Expanding into regions with more stable trade frameworks and high consumer demand enables Australian retailers to scale sustainably. Logistics partners like SEKO Logistics continue to support businesses in navigating these transitions by leveraging their global network, providing expertise in customs compliance and tariff management, and offering structured logistics, transparent pricing, and support for stable trade policies. By adopting a proactive diversification strategy, Australian brands can future proof their operations and maintain resilience in an increasingly complex global ecommerce landscape.