Tariff Workarounds in Retail: What B2B2C Can Do—and Where It Falls Short

Retailers facing elevated tariffs, disrupted supply chains, and inflationary pressure have adopted creative strategies to reduce duty costs. One of the newest approaches is routing consumer orders through intermediaries that act as the merchant of record or importer of record, rather than having the retailer itself import directly at the retail value. This B2B2C (business-to-business-to-consumer) model has quickly gained traction.

Here is what’s known about how it works, the benefits, and the risks.

How the Model Works

When a U.S. shopper buys online, the transaction is often shifted to a partner like Global-e or ESW. That partner formally purchases the goods at a wholesale price, pays tariffs on that lower value, and then fulfills the order. From the consumer’s perspective, the process looks the same. Prices stay lower, delivery is smooth, and the payment processor shows up simply as the merchant of record.

The savings can be significant. Yours Clothing in the UK told CNBC that duties on a $30 dress could be cut in half by routing the transaction this way. Luxury players like Tod’s Group have also used the model to keep U.S. prices aligned with those in other global markets.

Why Retailers Like It

The math is straightforward: paying tariffs on wholesale values instead of retail tags often reduces costs by 30 to 60 percent. That can preserve margins at a time when inflation is pushing up every other expense. It also avoids forcing consumers to absorb price hikes that could drive them to competitors.

Companies are pairing the approach with investment in U.S. warehouse space. Having inventory and returns handled locally means retailers don’t need to re-import returned goods, a step that would otherwise trigger a second round of tariffs.

The Legal Guardrails

Under U.S. Customs law, whoever acts as importer of record must exercise “reasonable care” in declaring value, country of origin, and classification. That means documentation and recordkeeping are critical. U.S. Customs and Border Protection (CBP) has broad authority to audit and assess penalties if values appear misrepresented.

Where the Risks Appear

The biggest concern is sustainability. Customs experts warn that while the model works at modest volumes, higher sales could invite regulatory scrutiny. If auditors decide declared values do not reflect the true commercial transaction, retailers could face retroactive duties or fines.

There’s also the danger of viewing the tactic as a cure-all. As Nunzio De Filippis of CargoTrans told CNBC, tariff arbitrage can feel like “taking aspirin for a broken leg.” It eases pain in the short run, but it doesn’t address structural vulnerabilities in sourcing and supply chain design.

A Balanced Approach

Retail leaders would be wise to treat B2B2C as one lever among many. Pairing it with longer-term strategies—such as diversifying sourcing regions, nearshoring production, and strengthening compliance audits—offers more durable protection. Clear contracts with intermediaries, meticulous recordkeeping, and legal oversight are essential safeguards if the model is used.

Final Thoughts

The B2B2C workaround reflects both the ingenuity and fragility of modern retail. It shows how quickly companies can adapt under pressure, but also how easily those adaptations can collapse under regulatory or market stress. The retailers that balance short-term creativity with long-term resilience will be the ones best prepared to navigate trade uncertainty.

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