As leaders in the Bridal Industry that consists of over 6,400+ retail, wholesale, and manufacturing businesses across America, we are writing to express our deep concerns about a growing problem that is destroying not only our industry as we know it, but also the overall U.S. Economy, U.S. Brands and Retailers.
Labeled “China Direct”, Chinese manufacturers are exploiting what is referred to as the Section 321 De Minimis Value Entry. In summary, Section 321 allows for goods valued at $800 USD or less, to enter duty-free into the U.S. Under this legislation, they are also permitted to enter without formal entry. As a point of reference, prior to February 24, 2016, the U.S. allowed de minimis value was $200 or less and the current de minimis threshold for Canada is $100 with Mexico at $300 and China at $7.
Specific to the Bridal industry, under the current de minimis level of $800, Chinese manufacturers can infiltrate our economy by undercutting the fair market price for a wedding dress. Consumers purchasing directly from Chinese manufacturers, that are able to import without paying duties, can take full advantage of discounts where duty-free, cut-rate shipping and manufacturing costs are used to entice customers away from our longtime established and trusted retail partners. These consumers, however, may be subject to sub-par merchandise quality, counterfeit products, lengthy shipping times and restrictive return provisions.
As an American-owned business that produces responsibly with Chinese partners, we have worked tirelessly to build decades-long relationships, to conduct our business with honesty and integrity, and to serve our customers by delivering high quality garments. Conversely, China Direct shipments are often low-cost and low-quality merchandise that cannot be returned. Amid global recession fears and a looming 10% tariff increase on Chinese imports set to take effect on 9/1/2019, U.S. bridal stores and manufacturers are under intense pressure and the communities and consumers we support are in jeopardy of losing us as an industry. The U.S. de minimis threshold that empowers China Direct must be removed or brought to parity of $7 which is the Chinese De minimis to stop the imminent decline of not only the bridal industry, but the U.S. Retail industry overall. In the face of such unfair advantages, small businesses are struggling to maintain quality, inventory and the employment of hundreds of thousands of Americans who provide services daily to millions of wedding couples (2.2 million weddings in 2018).
Our 72+ billion-dollar industry is severely compromised by import duty loopholes. Every year, hundreds of thousands of products from China are delivered directly to U.S. consumers. These goods enter our country without paying duties or state and local taxes due to the De Minimis Value Exemption. As a result, domestic businesses are penalized and losing sales for competing and advancing higher industry standards that protect the American consumer.
We ask that you join us in this fight to eliminate China Direct’s unfair advantage, and to protect our industry from further harm. Immediate action is required to save our brands, retailers, manufacturers and economy. We’re urging you to use your voice to tell the US government that the de minimis value must be changed to a reasonable, nominal amount that does not put our businesses in jeopardy. China profits off of the American economy by producing for our brands, and it should not have the unfair advantage of working directly with our consumers by undercutting us due to duty rules. This change will build the barriers required to shield our businesses from the harmful effects of China Direct and reverse the downward spiral our domestic retailers are confronted with. Please find the link below to pledge your support in a meaningful way that will help facilitate the change we need to preserve the small business owners everywhere across the United States.
Respectfully, Justin WarshawCEO – Justin Alexander
Bruce CampbellPresident - IBMA
Peter GrimesPublisher - VOWS Magazine
