2025 Holiday Shopping Season Shaped by Tariffs

Trump’s Tariff Policy Scrambles Retail Holiday Planning

With summer winding down, retailers across the U.S. are already eyeing the 2026 holiday shopping season—but this year, plans are tangled in tariff chaos. President Donald Trump’s unpredictable trade policies and sudden import tax hikes are complicating everything from product catalogs to warehouse space.

For companies like Balsam Hill, known for artificial Christmas trees and decorations, the result is a thinner holiday lineup. “The uncertainty has led us to spend all our time trying to rejigger what we’re ordering,” said Mac Harman, CEO of Balsam Brands. “We don’t know which items we’re going to have to put in the catalog or not.”

Retailers Brace for Delays, Cost Increases, and Smaller Selections

Retailers normally finalize holiday orders by the end of June. But this year, wavering tariff announcements have forced buyers into limbo. Import taxes on Chinese goods—at one point as high as 145%—only eased in early summer, cutting deep into the critical holiday manufacturing season.

The U.S. toy industry has been hit particularly hard. Nearly 80% of toys sold in America are sourced from China, and the late start in production means toys are only now reaching warehouses. According to Toy Association CEO Greg Ahearn, smaller toy companies have seen a sharp drop in manufacturing activity compared to last year.

James Zahn, editor-in-chief of Toy Book, said it’s still unclear if breakout toys of the season will be restocked in time—if tariffs spike again, some stores may simply miss the chance.

Store Owners Cut Products to Manage Price Hikes

Independent toy store owners are already making hard choices. Dean Smith, co-owner of JaZams in New Jersey and Pennsylvania, said he slashed half his usual product orders to avoid pricing out customers. “We’re just trying to be as friendly as we can to the consumer and still have a product profile that meets everyone’s needs,” Smith said.

Some toy companies, including Schylling—the maker of Needoh and Care Bears—have already raised wholesale prices by 20%. Retailers like Hilary Key of The Toy Chest in Indiana say they’ve received repeated price hike notices and are unable to test new products due to potential import delays and surcharges.

“My concern is not that I’ll have nothing,” said Key. “But that doesn’t mean I’m going to have the best stock for every developmental age or every special need.”

Tariff Delays Create a Temporary Surge in Imports

The White House recently postponed new tariffs on imports from Brazil, Mexico, and the European Union until August 1. That brief pause sparked a rush to bring in goods early—June marked the Port of Los Angeles’ busiest month in its 117-year history.

Port Director Gene Seroka described the scramble as a “tariff whipsaw effect”—a boom-and-bust cycle of imports based on the latest trade announcements. July imports remain high as retailers rush to fill shelves before costs rise again.

Consumers Begin Holiday Shopping Early

Some consumers are already responding to higher prices and lower inventory by shopping early. Smith said shoppers are scooping up Jellycat plush animals and oversized stuffed toys before prices climb further. To prepare, his team doubled their warehouse space to house early shipments of essential items.

Still, retailers know reordering popular products could become prohibitively expensive if tariffs return to spring levels. “We’re seeing people trying to beat the price increases,” Smith added.

Companies Lower Expectations Amid Supply Challenges

Even larger retailers like Balsam Hill are dialing back expectations. With too many unknowns and too little time to adapt, the company has scaled back its usual holiday offerings. “We’re just not going to have a bunch of the items that consumers want this year,” said Harman. “And that’s not a position we want to be in.”