The real cost of offshore manufacturing (and how US production solves it!)
For US sellers, manufacturing in Asia to sell on Amazon.com just got a lot more complicated – and costly.
Trump’s tariff regime has seen alarming price rises for manufacturers and consumers alike. In fact, the average US tariff rate on all goods from overseas is at its highest level since 1934: 18.2%, according to the Budget Lab at Yale.
Manufacturers often have no choice but to pass onƒ these higher costs to their customers, with dire consequences in terms of brand loyalty and cut-price competition.
But the tariff war isn’t the only compelling financial reason to start investigating US production.
If you’re selling on Amazon in the US, and you want to stay competitive, it may be time to start manufacturing closer to home – for brand protection and reputation, as well as cost.
The effects of the tariff war
Trump started waging his tariff war in April, starting with China and spreading to almost every country in the world.
Since then, most goods coming into the US have faced taxes of 10% or more, with plans to levy even higher tariffs from this month – up to 50%.
Most US manufacturers have already taken a painful hit to their bottom line, from small Amazon sellers to giants like Hasbro and General Motors.
Economists predict slower growth and lower investment in the USA as a result.
What’s the point of the tariffs? The BBC reports that the US government has already collected a record $100bn in tariff revenue this year, which is one motive.
But the other motive is to encourage more domestic manufacturing in the US – which we think is very worthwhile, and not just to avoid the tariffs. Here’s why you should investigate US manufacturing options.
The hidden costs of manufacturing overseas
When comparing quotes across different manufacturers, it’s easy to focus on unit price. But the hidden costs of low-cost vendors overseas often show up later in delays, compliance issues, or poor product performance.
Our friends at GP Labs, a private label manufacturer with facilities in both Florida & Georgia, have provided this table to show what’s actually included in their full-service, North American manufacturing quote – and what’s usually missing from those that come in 5-6 times cheaper.
Comparison: US Manufacturing vs Offshore Low-Cost Vendors
| GP Labs (US Manufacturing) | Typical Low-Cost Offshore Quote | |
|---|---|---|
| Formula quality | Clinically active % of ingredients. Clean-label. Vegan or naturally sourced where possible. |
Fillers, synthetics, unstable emulsifiers, unverified % of actives. |
| Testing | Microbial, heavy metals, stability – available and encouraged for all SKUs. | Often skipped or additional cost – sometimes not available at all. |
| Compliance support | FDA, Health Canada, and Amazon-aligned labeling + regulatory guidance included. | Clients must manage all compliance – high risk of claim violations making brand vulnerable to lawsuits. |
| Speed to market | 2-4 weeks (stock) / 4-6 weeks (custom) with rapid sample cycles. | 8-12+ weeks including customs, formulation unknowns, and back-and-forth. |
| MOQ flexibility | Launch-ready with as low as 500 units (stock) or 3,000 units (custom). | Often 5,000-10,000+ MOQ to be prioritised, even on the first run. Little flexibility. |
| Packaging & fill | Tight spec alignment. Rigid QC across fill weights, aesthetics, and stability. | High fill variance, unstable bottles, thin plastics, incorrect viscosity. |
| Service & communication | Dedicated PM, fast response, phone/email support, and proactive guidance. | Language barriers, long delays, little to no formulation collaboration |
| Returns, recalls & relabeling | US-based production = fast re-label or recall-ready if needed. | Impossible to fix post-shipment. No legal recourse. |
| IP protection | NDA-bound custom formulas, never resold or white-labeled without permission. | Formula re-use is common, especially in white-label environments. |
| Logistics, tariffs & fulfillment | Product is already in the US – you simply schedule delivery to Amazon, a 3PL, or your fulfillment partner. No surprise fees. Domestic shipping costs only. | You must coordinate and pay for international air/ocean freight, face volatile shipping costs, tariffs, customs delays, and clearance issues – all of which can destroy timelines and budgets at scale. |
Protecting your brand
The bottom line is that US manufacturing protects your brand, reputation, and speed to market, ensuring a more profitable product and allowing business growth.
And it’s not just the US where GP Labs can help you. The business, which manufactures a wide selection of white label products and specialises in cosmetics, health supplements and other formulas, also has access to manufacturing plants in the EU, which makes it a great choice for US sellers wishing to expand their Amazon presence into Europe.
Natasha Nicole Jugovic, GP Labs CEO & Founder, says: “A ‘cheap’ quote might save a few cents per unit up front – but is likely to cost you weeks of time, re-work, and reputational damage when it matters the most.
“At GP Labs, we focus on smart-scale, premium-brand support, and regulatory peace of mind so you can grow with confidence.”
Visit https://www.gplabsco.com/ to find out more.