Post Image
  On Wednesday, April 2, US President Donald Trump imposed tariffs on most of his country’s trade partners. Nigeria wasn’t left out, as it got hit with a 14% tax on all of its exports to the United States. Now, Nigerian ecommerce businesses, like many of their counterparts elsewhere in the world, are thinking hard about how to adapt to the Trump tariffs.
Read more about Business
This is no easy thing to cope with, especially for outlets that depend heavily on the American market. Theirs is a wealthy economy, with average purchasing power that dwarfs others. Losing that market could be painful for a lot of international sellers, including those operating online. So, how can you live with these tariffs—or even thrive despite them –if you are a Nigerian ecommerce business that supplies to the US? This article gives you a few ideas.

Rethink Product Sourcing

There are multiple ways that reconsidering product sourcing could play out in your business. First, you could reexamine domestic sources for the products you’re shipping overseas. Can you get better deals from them? Try to renegotiate your agreements and push for terms that allow you to keep your prices within a manageable range for your buyers abroad. Also, seek out new suppliers if you need to access improved offers. Another front on which product sourcing should be weighed is items from other countries. If your platform sells goods that originate from countries that have incurred higher tariffs than Nigeria, now would probably be the time to consider local substitutes or countries facing lower US tariffs.

Review Pricing Strategies

The new tariffs mean (among other things) that you may need to choose between lower profit margins and lower sales. You might even have to live with a bit of both. Recalibrating your prices is a fair move if you have room to manoeuvre. You could offer discounts for a while to the extent that you can afford them. Just make sure you also provide value for money and excellent service. The aim here is to build reputation and loyalty, so you have something to work with if or when you decide to raise prices. Anyone who is determined to remain relevant in the US markets should learn its dynamics as it relates to them. For example, they should know their buyer demographic, how people in that population respond to pricing, and why they do so. Dynamic pricing—adjusting prices according to real-time demand –may also be worth exploring.

Diversify into New Markets

In times like these, it becomes clear why diversification is a good buffer against economic turbulence. Selling to the US market may be lucrative, but depending almost entirely on it (or any single market) is risky. What happens if most of your customers don’t want to pay 14% more for your products? Find out what other countries your e-commerce business can target. They may be in Europe, Asia, or South America. Perhaps there are untapped opportunities in Africa that you have overlooked, too. Investigate ways that the AfCFTA can enable you to sell to African markets with fewer barriers.
Sign up for the Connect Nigeria daily newsletter
Even if the current storm abates quickly, the threat it has posed should motivate you to diversify. After all, you can’t be absolutely certain that the American economy (or any other economy) will always remain as attractive as it is now.

Double Down on Quality

Despite the size of the US tariff on Nigerian goods, the 14% fee slapped on them is on the lower end of the range that the Trump administration has delivered. This may give such goods an advantage over similar items from countries facing much steeper tariffs. Exploiting this advantage to the fullest requires that you emphasise the quality of your product. If your main competitive edge is lower prices, you need to improve the item itself. It’s one way to reduce the impact of the tariffs on your business. A combination of relatively lower-priced offerings and improved quality could help you keep at least some of your clients in the US.

Adjust Your Business Model

Some e-commerce businesses may have to tweak things or shift to a different model. A number of internationally-focused dropshipping outlets will struggle to cope with the new tariff regime. Their business model is only viable if they can sell at slightly higher prices than what’s set by producers or wholesalers. If tariffs eat into their margins, staying operational will probably not make financial sense. But they do have the option of transitioning to a different system. Instead of being the go-between for Chinese producers and US buyers (for instance), they can retail Nigerian products or even sell their own. It might be harder or even costlier, but it’s better than losing the business entirely.
Register to attend the CN Business Mixer

Final Words

If the Trump tariffs persist, they could redefine global trade. You can protect your Nigerian e-commerce business from the worst effects of this policy by taking the steps we discussed in this article.
Got a suggestion? Contact us: editor@connectnigeria.com
You might also like:
This article was first published on 1st May 2025
Notice: Undefined variable: last_modified in /var/www/html/articles/wp-content/themes/cnhalptem/content-single.php on line 36

ikenna-nwachukwu

Ikenna Nwachukwu holds a bachelor's degree in Economics from the University of Nigeria, Nsukka. He loves to look at the world through multiple lenses- economic, political, religious and philosophical- and to write about what he observes in a witty, yet reflective style.

Comments (0)

Leave a Reply

Your email address will not be published. Required fields are marked *