As we step into a new political era, the nation watches with bated breath. A mix of unease and caution fills the air as many ask: What’s next? And, for Black-owned beauty businesses, the question feels especially urgent.
Under the first Trump administration, tariffs became a favored economic tool, reshaping industries across the board. It appears these policies will persist under his renewed leadership.
For Black beauty brands—already navigating systemic hurdles—the ripple effects of tariffs have hit harder and will likely continue to do so. From supply chain disruptions to rising costs of goods, these policies add yet another layer of challenges for these businesses.
How will this play out in 2025? More importantly, how can Black beauty brands adapt and thrive amid these potential challenges? To explore this, it’s crucial to first understand what tariffs are and how they function. Learn more below.
What are tariffs?
A tariff is a tax on imported or exported goods and services. These taxes regulate trade, often to protect domestic industries or retaliate against unfair practices. However, for businesses reliant on imported goods, tariffs can be damaging—especially for smaller operations without the flexibility to pivot their sourcing or manufacturing.
“In the beauty industry, profit margins are crucial,” explains Joia Doss, founder of Arli Strategic Advisory. “They not only enable brands to operate efficiently and reinvest in growth but also attract investors. Tariffs directly eat into those margins, forcing brands to eventually pass the increased costs onto consumers in the form of price hikes just to stay afloat.”
For Black-owned beauty brands, many of which are deeply connected to loyal consumer bases, raising prices could strain the relationships that fueled their initial growth. “These brands value their loyal consumers, and raising prices could jeopardize those relationships,” Doss adds.
Systemic Barriers Amplify The Challenge
Founder of the Black Beauty Club, Tomi Talabi, echoes this concern. “Black beauty entrepreneurs already face systemic barriers within the supply chain, including limited access to capital to place large bulk orders that could help offset tariff costs,” she tells ESSENCE. “They also have fewer direct manufacturing relationships, often relying on middlemen who mark up prices, and face challenges securing prime vendor contracts dominated by larger brands.”
The barriers don’t stop there. In 2023, funding for Black-owned brands dropped by a staggering 71%, highlighting the uphill battle these entrepreneurs face. “The biggest challenge for smaller Black-owned brands is resources,” says Lita Cunningham, founder of LALAIS Skincare. “Black beauty founders get less than one-half of 1% of investment dollars in the beauty industry.”
Cunningham notes that while the current administration’s new tariff policies have yet to take effect, her company is bracing for their implementation, expected as early as February 1, 2025. LALAIS Skincare sources ingredients globally, with some only available from specific regions. “The largest suppliers of components—bottles, pumps, caps, glass—are in China,” Cunningham explains. “Many U.S.-based companies rely on overseas suppliers. It’s not as simple as ‘just find a domestic supplier.’”
Navigating these new policies won’t be easy. It’s another hurdle for Black beauty brands striving to stay afloat in an oversaturated and competitive market. “We’re likely to see many [Black beauty] brands scaling back, operating with smaller teams and fewer marketing resources. This diminishes one of their key advantages over legacy brands—the ability to innovate and respond to consumer demands quickly,” says Doss.
The Implications Of Tariffs On Black Beauty
Because Black-owned beauty brands often have to be creative and nimble with limited resources, outsourcing ingredients can be the most cost-effective solution. “Many smaller Black-owned beauty brands have been resourceful in getting their products to market, often opting for cost-effective packaging from China and partnering with contract manufacturers in various countries to produce high-quality formulas affordably,” explains Doss.
“Packaging is a critical marketing tool and differentiator in the beauty industry,” she continues. “If costs skyrocket, brands could struggle to find domestic alternatives that fit their budgets.”
Black consumers are drawn to brands that prioritize their unique needs—needs that larger brands often overlook. As a result, we turn to Black-owned brands that keep us at the forefront. Many of the ingredients these brands rely on to meet our needs simply can’t be sourced domestically. Doss emphasizes this point: “Many of the unique ingredients that Black-owned beauty brands use are a key attraction for the consumer, catering to their unique needs.”
When it comes to the implications of tariffs, Doss highlights significant challenges: “Tariffs can disrupt the global supply chain, leading to long delays in obtaining specific ingredients and driving up shipping costs. For brands with retail distribution, these delays can be particularly devastating,” she says.
“Businesses that have fought hard for scarce shelf space may find themselves unable to fill their orders, resulting in prolonged out-of-stock periods. Worse still, the high costs from these disruptions can erode margins to the point where brands are forced to fulfill orders and maintain retail presence at a loss.”
It’s a harsh reality. These impending policies feel like yet another obstacle designed to set Black-owned businesses up for failure. For brands already navigating systemic inequities, the stakes couldn’t be higher.
However, Talabi sees opportunity amidst the challenge. “This could push the Black beauty community to invest in domestic manufacturing, build more direct-to-consumer (DTC) brands, and work together on bulk purchasing and logistics to lower costs,” she suggests.
We recognize the challenges Black beauty brands and businesses are likely to face under this new administration. However, there are steps these brands can take to prepare and mitigate the impact. Similarly, consumers have a vital role to play in supporting their favorite Black-owned beauty brands through impending challenging times.
Steps Black Beauty Brands Can Take
While the challenges are significant, Black-owned beauty brands are not without options. Here are a few strategies to prepare for and mitigate supply chain issues caused by tariffs.
Diversify suppliers and explore domestic options: Building a network of diverse suppliers can reduce reliance on regions heavily affected by tariffs. While domestic sourcing may not always align with cost structures, exploring local alternatives can mitigate risks of delays and inflated costs.
Invest in bulk purchasing and collaborative logistics: Black beauty brands can pool resources within their communities to place bulk orders, reducing per-unit costs. Shared logistics solutions, such as joint warehousing or freight, can help offset rising shipping expenses.
Strengthen direct-to-consumer channels: Shifting focus toward DTC sales gives brands more control over their margins while avoiding retail distribution delays. Robust e-commerce platforms, creative marketing, and exclusive product offerings like pre-orders can help maintain customer engagement.
How Consumers Can Support Black Beauty
Consumers play a critical role in ensuring the survival of Black-owned beauty brands. These are a few actionable ways to help.
Direct purchasing: Prioritize buying directly from the brand’s online store whenever possible. This ensures that the brand receives the full profit from your purchase, rather than losing a percentage to third-party retailers. Direct sales also help small businesses better manage their margins and reinvest in growth.
Understand the roadblocks: Black-owned beauty brands are often disproportionately affected by systemic hurdles, including supply chain issues that may lead to stock shortages or longer delivery times. As a consumer, being aware of these challenges and extending grace and patience can make a difference. This understanding fosters a stronger connection between you and the brands you love.
Engage on social media: Actively engage with Black beauty brands on social media. Like, comment, and share their posts to help boost their visibility and credibility. Algorithms often favor content with higher engagement, so every interaction helps these brands reach new audiences without the need for costly ad campaigns.
Cunningham, underscores the importance of consumer support: “The best course of action for us, as consumers, is to spend our dollars with those who are fighting like hell to bring you high-quality products with you in mind.”
While the road ahead remains challenging, consumers, brands, and the broader industry must work together to create meaningful change. Through collaboration, resilience, and innovation, Black-owned beauty brands have the potential to not only adapt but also carve out new paths to success.