The Brands That Survive Tariffs Aren't the Ones You'd Expect

Every founder I talk to right now is stressed about tariffs. And I get it — if you're importing finished goods from China, the math just changed dramatically. But after watching 30+ portfolio companies navigate this over the past few months, I've noticed something interesting.

The brands that are handling it best aren't necessarily the biggest or the best-funded. They're the ones that built real relationships with their manufacturers years ago.

When tariffs hit, the first thing most brands do is panic-email their supplier asking for a price reduction. That's a dead end if your supplier doesn't know you beyond a purchase order number. The brands in my portfolio that had founders who'd visited their factories, shared meals with the owners, and built genuine trust over years — those founders got on a call and figured out creative solutions together. Split the cost increase. Adjust materials. Shift production to a different facility.

At Paking Duck, we've been having these conversations constantly. Our clients are coming to us asking how to maintain their packaging quality while absorbing tariff-related cost increases. And because we have deep supplier relationships — not transactional ones — we can actually help them find solutions that a sourcing agent on Alibaba never could.

The other thing I've noticed: brands with higher margins are obviously more insulated, but it's more nuanced than that. The brands with strong repeat purchase rates can absorb a small price increase without losing customers. The ones relying on one-time purchases from cold acquisition? They're stuck. They can't raise prices because the customer has no loyalty yet.

I keep telling founders: the time to build supply chain resilience is before you need it. The relationships you invest in during good times are the ones that save you during bad times. That's true for manufacturing, for packaging, for everything.

The tariff situation will evolve. What won't change is that the brands with real relationships and real margins will always weather disruption better than the ones optimizing for the lowest possible cost.