The EU will impose a 3 euro duty on small packages bought online from China on July 1, aiming to stop what officials are calling a “wave” of small parcels from China.
The charge targets a specific business model, one where individual orders bypass traditional bulk shipping and go straight from a Chinese warehouse to someone’s door. But that model has grown so large, so profitable, and so deeply embedded in global logistics infrastructure that a customs charge is unlikely to stop it.
Shein and Temu popularised the approach. They were among the first to recognise that shipping individual orders directly to consumers was often cheaper than the traditional model of buying inventory in bulk, shipping it to a European warehouse, and distributing it from there. The savings come from keeping stock in China until the moment of sale, avoiding the costs and risks of holding inventory abroad.
Since then, the model has spawned an entire ecosystem of 3PL businesses offering services that simply did not exist before. EcomFlow, for example, lets a merchant in London list and sell products online while EcomFlow handles storage and delivery from a warehouse in China. The merchant is, in effect, a storefront. The warehousing, the logistics, and the customs liability are handled by EcomFlow. For the merchant, the practical effect is the ability to source and sell from China without needing any physical presence in the market they’re selling into.
Hundreds of operators now offer variations of the same service. China’s cross-border e-commerce trade reached 2.75 trillion yuan in 2025, up 15.5% from the year before, according to Chinese customs data.
For years, commentators assumed the model only worked because of de minimis exemptions, the threshold below which imported goods attract no customs duty. But while the exemption helped in the early stages, the underlying cost structure has since matured. Removing a tax benefit changes the margin. It does not change the arithmetic.
For small commodity manufacturers in the EU, it would no doubt be reassuring to believe otherwise. But the ability to source and sell directly from China is not really about tax advantages in many cases. For a growing number of buyers, it is simply the most economically rational way to trade.
One reason the model is so hard to displace is that storing goods in China is often cheaper than in Birmingham or Rotterdam, and fulfilling from origin ties up less capital in unsold inventory. Goods only move once an order is placed.
Getting goods to customers in Europe or the U.S. has also become faster and, in some cases, cheaper than a decade ago, helped by stronger air-cargo capacity. China’s air cargo throughput reached 21.9 million tonnes in 2025, up 9% year on year, and IATA recorded 2025 as a record year for global air cargo volume. For merchants, that infrastructure makes global scaling possible in a way it simply was not before.
Underpinning all of it is China’s manufacturing base. No other country has factories producing such a wide range of goods, clustered so closely together, with the ports, warehouses and freight networks already in place to ship them anywhere in the world within days.
Businesses outside of traditional e-commerce are now adopting similar models. Bloom Build, for instance, takes orders from individuals renovating their own homes for construction components and fulfills them directly from Chinese partners, without ever holding stock in Australia. In the coming years, similar providers are likely to emerge across a wide range of sectors.
Beijing has also been supportive of the model. In May 2024, Xi Jinping called for the accelerated development of new models such as cross-border e-commerce. Multiple ministries have since coordinated preferential tax treatment and eased administrative requirements for the sector, while state-backed industrial parks have sprung up offering sellers subsidised space and tailored tax support.
None of that is to say that buyers should abandon their China operations and outsource everything to a modern 3PL. Sourcing from China has always required supplier relationships and on-the-ground management, and that remains true here. What this model changes is not that reality, but where the logistics infrastructure needs to sit.
What companies like EcomFlow and Bloom Build are selling, at their core, is China’s supply chain capability. The ability to source from the world’s most competitive manufacturing base, store goods at low cost, and deliver them anywhere within days, without building any of that infrastructure yourself. And that’s likely worth far more than a 3 euro duty.
