Like a scene from Martin Scorsese’s GoodFellas, containers full of inventory and supplies are being rerouted to other countries, sent back to China, or taking up space in Chinese warehouses due to brands not able to pay Trump’s stifling 145% tariff. Almost every beauty and personal care brand utilizes China for at least one element of its supply chain—no one is exempt from this trade war.

Founders are scrambling to come up with the cash to bail out their much-needed shipments, and with no end to this trade war in sight, brands are frantically trying to come up with solutions that will keep them in business through 2026. But, as Henry Hill in GoodFellas would have said if he were the US government, “Shipments cost more than four times what you budgeted for this year? F-U, pay me.”

Alexandra Fine, co-founder and CEO of Brooklyn-based sexual wellness brand Dame, has already told her Chinese manufacturer that she cannot pay for the orders she committed to months ago. “Nobody wants to order something, be told it’s a certain price, and then find out it’s actually 150% more,” Fine said. She added that she cannot effectively run a business with this level of uncertainty. “You [the government] want me to make decisions about my supply chain? I need stability.”

Stability seems to be in short supply these days. While Trump’s steep tariffs are the most significant headwind robbing our financial system of stability, a dramatic dip in consumer confidence and tourism is also catapulting our economy into entropy. Last week, Chief Economist at Apollo Investments Torsten Slok predicted in his newsletter that there is a 90% chance the US will be in a recession by summer, and we can expect empty shelves within weeks.

Slok wrote that “extremely high tariffs overnight” hurt all US businesses, but particularly small businesses, because the tariff must be paid by the business when the imported goods arrive in the US. “Small businesses that have for decades relied on a stable US system will have to adjust immediately and do not have the working capital to pay tariffs. Expect ships to sit offshore, orders to be canceled, and well-run generational retailers to file for bankruptcy.”

While many brands may be scraping to pay the duty on shipments sitting in port, others are attempting to reroute containers to Canada and Mexico to avoid paying the sky-high tariffs. James Stewart, Business Development Manager for Clearit, a Freightos company that handles digital customs brokerage, said, “Freightos is seeing companies attempting to re-manifest ocean bills of lading to Mexico and Canada, or keeping inventories in the country of origin in hopes an interim agreement is met.”

Dustin Cash, CEO and co-founder of Los Angeles-based SOS Beauty Group, a brand incubator, product development, and manufacturing company, was forced to store pieces in a Chinese warehouse because of the astronomical tariffs. One of the prestige products Cash manufactures has an “intricate, complex component” that can only be created by a specialist manufacturer in China. “The tariff on that [component] alone for 100,000 pieces is $860,000.”  The company is warehousing the item until “cooler heads prevail.”

With cargos being rerouted or warehoused in countries of origin, fewer shipments are sailing to the US from China. The Port of Los Angeles is the largest port in North America, with 45% of its shipments coming from China. Addressing the Los Angeles Harbor Commission last Tuesday, Gene Seroka, Executive Director of the Port of Los Angeles, said that arrivals this week will be down 35% year over year for May. Seroka also said that 20% of vessel arrivals from China have already been canceled due to a lack of cargo.

So, what should brands do if they are having a hard time navigating the tariff tsunami and bracing for a recession summer? “Don’t panic,” Deanna Kangas, beauty advisor and investor at Strategic Growth Consulting, tells her clients. “The first thing I say is to take three deep breaths,” and then she and the brand come up with a crisis plan. “We look at their [brand clients’] P&L and ask, ‘What is mission critical? What can we cancel? What can we put on hold?’”

Kangas said she and her team always look at what brands spend on marketing and what's driving the most return on investment. “And then we lean into that. Maybe we put on hold your brand marketing, which just promotes the brand versus marketing driving product sales.”

"Now is not the time for long-term, three-year strategies," Kangas said. "We’re in a triage phase—the priority is to stabilize operations, minimize losses, and navigate through the immediate challenges of this year."

But first, brands need to get through the summer.