American beauty founders are warning prices are likely to go up as the global skincare and cosmetics industry comes to terms with Donald Trump's new tariff regime.
And while US based consumers are wondering whether or not to stockpile their favourite products, TikTok videos from Chinese creators revealing industry secrets about which luxury brands they manufacture are flooding their algorithms.
US consumers have raised particular concern over the tariffs threatening to undermine the affordability of much-loved K-beauty products, which have been propelled to cult status among savvy skincare consumers looking for lower priced items.
In a very busy marketplace, K-beauty — skincare products from South Korea — offers Americans a few key things – aesthetic products that look and feel high-end as well as decades of innovation that, by all reports, delivers results.
But K-beauty products also come with a price point that sits well below most US equivalents and it's this key point of difference some fear could now be under threat.
The US president's rewriting of trade rules across the world has left executives, start up founders, small business owners and consumers alike wondering how the industries they love and work in will look going forward.
The global beauty sector was worth more than $US400 billion ($635 billion) in 2023 and was projected to grow to nearly $US600 billion ($953 billion) a year by 2028, according to consultancy McKinsey & Company.
The North American market accounts for at least 20 per cent of the global trade in beauty products — items that are bought and used quickly and of which many skincare lovers can never have enough.
Some stores have spent the past two weeks trying at first to rush orders into the US before the initial reciprocal tariffs came into effect, only then to have a pause announced while extra stock was already en route.
The impact so far is that brands are warning American consumers prices are likely to rise and the industry itself is fearing the upheaval and uncertainty Trump's tariffs are continuing to bring.
Low K-beauty prices threatened
Christina Im runs K-beauty store Olive Kollection from California and brings her products into the US to sell domestically.
The past two weeks have been spent trying to adapt to Donald Trump's new rules.
Initially, imports into the US from South Korea were hit with a 25 per cent so-called reciprocal tariff.
"We had to hurry and try to restock at least some of our best sellers with the current price we have," she told the ABC.
Then just days later, Donald Trump seemed to back down and South Korea was shifted to a 10 per cent flat rate tariff, along with most US trading partners.
"So we spent, almost $US40,000 ($63,500) — all our cash that we had for the business — then the 25 per cent went away, so now we're stuck with all this extra merchandise."
"Skincare actually does expire, so we have to try to now sell more, but then the economy's not doing well, so it's just a lot of a lot of [different] factors."
K-beauty products have garnered a loyal following and as news of the tariffs was breaking, Americans started to ask beauty influencers whether it was time to stock up on staples if prices were set to rise.
Besides the expiration dates on most active products, the broader concern is what happens when any stockpile runs out.
During the depths of the pandemic, when it wasn't possible to spend money on clinic-based treatments, US consumers got to know mugwort, pennywort, propolis extract, snail mucin and other actives on the ingredient list of K-beauty favourites.
It was possible to give these ingredients a try because they were priced competitively and a new 10-step K-beauty skincare routine filled the little treat-sized void left by cancelled facial appointments.
Last year, South Korea overtook France as the number one exporter of skincare products into the US, according to the US International Trade Commission.
[US imports of skincare products]And data from the Korea Customs Service shows how that demand has grown over the past five years.
By 2021, there was a surge of K-beauty imports into the US from South Korea — including skincare and make-up products as well as sunscreen.
Last year, the demand for K-beauty products drove $US1.5 billion ($2.38 billion) in exports to the United States.
[Datawrapper chart of beauty exports from South Korea to USA]The tariff on South Korean imports as well as the massive 145 per cent tariff on products, like packaging, coming from China will threaten beauty brands and K-beauty affordability, according to one leading industry voice.
Skincare founder and one of the original K-beauty influencers Liah Yoo has explained the global supply chain behind her Krave Beauty products in a series of videos about Trump's tariffs.
"Right now China is probably the biggest country that can supply the amount of packaging that the beauty industry needs at scale, at a much more competitive and reasonable price," she said.
With imports from China facing 145 per cent tariffs, Yoo said: "This might actually bankrupt some beauty brands."
Her other comments, made when South Korean exports were facing the 25 per cent tariff, spoke to the potential issue for K-beauty specifically — that the affordability for US customers could completely shift.
"This hurts me so much. From now on you’ll probably see so many brands raising their prices left and right ... I don't think Krave Beauty is going to an exception," Yoo told followers.
"Our pride and our positioning was to offer premium sustainable skincare that's under $US28 and we've been operating for seven plus years and we've never increased prices."
Yoo said she believed "one of the best attributes Americans loved K-beauty for [was] its very affordable price point".
"I'm not sure how long K-beauty can be positioned to be that affordable price point now with this new tariff and trade policy."
Global marketplace 'critical' to industry
While the trade war between China and the US rages on, voices from inside China's manufacturing industry have been speaking directly to consumers via TikTok.
And Americans have noticed — sending several viral, even those that pre-date the tariff announcements.
In one a Chinese creator explains one luxury brand makes a cosmetic product for $5 before adding the branding and logo in France.
The trend has American consumers asking just how much mark up is on some products, but has also helped explain just how few will be spared from the impact of tariffs.
Beauty founder Yoo explained even a lip gloss product where the formulation is manufactured in the US could be impacted.
She gave an example of a brand importing a type of orange extract from China to go into their US-made formulation.
"Hypothetically speaking we would need to look for an alternative supplier," Yoo said.
"In the meantime that transition is going to cost the brand a lot because you not only need to do the stability testing again, you need to find the exact same one-to-one replacement for the orange extract with the quality and the composition … to be almost identical."
Personal Care Council executive Francine Lamoriello said: "Access to global markets is critical to our industry’s success and our ability to invest in US manufacturing and highly skilled jobs."
"The cosmetics and personal care products industry is a key driver of the US economy, with over $US68 billion ($108 billion) in US manufacturing and 4.6 million US jobs. Our industry directly contributes over $US300 billion ($476 billion) to our nation's GDP, and our products are essential to the daily lives of all US residents."
For Christina in California, the uncertainty is ongoing.
"I'm still anxious. When we first heard [about the tariffs] we were really, really worried about our future and how we're going to sustain our business," she said.
"It's always going to be in the back of my mind — always wondering, what's going to happen tomorrow?"
