EP 13: Navigating Tariffs, COGs, Bonded Warehouses and More with Brandon Young

 Episode Summary: Brandon Young on Tariffs & Survival Strategies for Amazon Sellers 

Due to the changing nature of this topic, we feel it is important to note that the recording date of this episode was April 16th, 2025

🎙️ Brandon is a seasoned 8-figure Amazon private label seller, founder of Seller Systems, and co-creator of Data Dive software. He joined Robyn and Abe to break down the recent spike in tariffs and what sellers can do to stay competitive and legal. 

🔑 Key Takeaways 

1. Tariffs Are Here and They're Brutal 

• Tariffs as high as 154% are being added to imported goods, massively impacting landed costs and margins. 
• Sellers used to bake in development and tooling costs into unit prices, but now those embedded costs increase tariff exposure. 

2. The “First Sale Doctrine” Strategy 

• By structuring purchases through an intermediary and separating non-dutyable costs (like tooling, packaging design, branding), you can lower your declared COGS and reduce tariff exposure. 
• Must have two arm ’s-length transactions, proper dual invoicing, and a clear declaration to customs. 
• Keep detailed records for at least 5 years to survive audits. 

Docs Required: 

• Original manufacturer invoice to intermediary 
• An intermediary invoice to your company 
• Declaration to customs of First Sale usage 

3. Use of Bonded Warehouses 

• Delays the tariff payment until goods are released into the U.S. market. 
• Offers flexibility—goods can be redirected to other countries (e.g., Canada or Mexico) if tariffs worsen. 
• Downsides: Tariffs could increase by the time goods are released. 

4. Drip-Feeding & Holding Inventory 

• Use strategies like SKUDrop to store goods in China and ship gradually. 
• Or ask your factory to hold inventory and release it in small batches to maintain price advantage and flexibility. 
• Be cautious about substantial transformation rules—just moving goods to Vietnam or Mexico isn’t enough; they must be significantly altered to change the country of origin. 

5. Monitor the Market 

• Track competitor pricing closely to avoid losing the Buy Box. 
• Don’t raise prices drastically; instead, use small increments or coupons to test elasticity. 
• Discount strategically to maintain rankings while preserving profitable inventory. 

6. Be Realistic About Relocating Production 

• Moving out of China is a long-term strategy—can take 6 to 12 months or more. 
• Factories in countries like Vietnam are often booked out until 2026. 
• Consider diversifying but don’t expect a quick fix. 

🔗 Links & Resources Mentioned 

• Brandon's Tariff Workshop
• 🔧 Seller Systems  
• 📊 Data Dive  
• 🌴 Camp Ecom (Amazon seller retreat in Cancun)  
• 📦 SKUDrop – China-based inventory drip shipping service

Nothing in this episode constitutes legal advice.  Please consult with your legal department before making any business decisions. 

Chapters

• 0:00 Welcome to the Top of Search Podcast
• 0:30 Import and Tariff Expert Brandon Young
• 4:00 Understanding the Impact of Tariffs for Amazon and Ecommerce Sellers
• 4:43 Options for Legally Reducing Tariffs on Goods
• 4:58 Reassesing Items Built Into Your COGs
• 12:44 Using Bonded Warehouses
• 14:50 Storing Inventory in China with a Drip To the US
• 16:05 Making Changes and Evaluations for SKUs
• 20:20 Keeping Access to Inventory with A Blended Approach
• 21:34 Passing Inventory Through Other Countries
• 24:25 Moving Production Out of China for Manufacturers
• 26:28 Expecting Changes in the Amazon and eCommerce Lanscape
• 27:22 Understanding DDP (Delivered Duty Paid)
• 29:57 De Minimis and EPackets
• 31:41 Discounting and Inventory Management
• 35:32 Strategies for Pricing Changes and Price Elasticity