The price of beauty is going up—and not just for consumers. Millennial beauty founders, many of whom have built their brands on accessible luxury and direct-to-consumer models, are facing a growing financial hurdle: tariffs. President Donald J. Trump has implemented a 25% additional tariff on imports from Canada and Mexico and a 10% additional tariff on imports from China. Energy resources from Canada will have a lower 10% tariff, according to The White House.
As trade policies shift and import duties rise, these entrepreneurs are forced to navigate an increasingly expensive supply chain, where everything from packaging to raw ingredients costs more.
The impact is immediate and far-reaching for independent beauty brands that rely on global suppliers. Rising tariffs on essential imports—such as Chinese-manufactured packaging, Korean skincare innovations, and European fragrance oils—are squeezing profit margins and forcing founders to rethink pricing, sourcing, and product formulations. While major beauty conglomerates have the resources to absorb these costs or shift production, smaller brands are left with difficult choices: raise prices, cut costs, or find new ways to stay competitive.
From reconfiguring supply chains to negotiating better deals, millennial beauty entrepreneurs are showing resilience and creativity in the face of economic pressure. But with tariffs constantly evolving, the question remains—how can these brands maintain their signature quality and affordability while staying afloat?
“That is an excellent question,” said Tamika Dukes, VP of Operations for Brown Sugar Babe. The popular direct-to-consumer body oil brand found its stride in recent years through consistent virality on social media. Dukes works alongside the company’s founder, her younger sister Maekaeda Gibbons.
Dukes said: “We are working through this new norm and trying to forecast in an even more targeted way because the tariffs are immensely impacting much of what we’re doing.”
Dukes explained that the brand laid plans to do various pop-ups and even open a flagship store this year, so the tariffs were an unwelcome surprise. One example of an activation Dukes and her team over-prepared for was a partnership with the Trinidad and Tobago Board of Tourism during the island’s annual Carnival celebration; Brown Sugar Babe supplied hundreds of units to event-goers.
“We tried to overcompensate because we foresaw many supply chain issues because of the impending changes,” Duke explained. “We have to get ahead of things.”
Beauty brand consultancy Rose Neal Collective advises its clients to follow this thinking. The firm has worked with various brands, including Fashion Fair, Tracee Ellis Ross’s Pattern Beauty, and Sienna Naturals, Issa Rae’s natural hair care company.
“This current {political} landscape is forcing young brands to think creatively,” said Dwight Neal, co-founder of Rose Neal Collective. “Fortunately, millennials are inclined to being ambidextrous, so pivoting almost comes second nature to the beauty founders that fall into that category.”
A 2024 American Express survey released shows that one in five Gen-Zers and Millennials say they were students shortly before diving directly into business ownership. The survey pointed out the influx in entrepreneurship among the younger generations because of the ease of entry and the groups’ resilience in times of economic change. But even in the pivot, a humble, nimble and innovative strategy should be in place according to Aris Singleton, CEO of natural hair care brand Thank God It’s Natural (TGIN).
“We had to implement a price increase, the first in 16 years of business,” Singleton said.
Although disappointing, she said she worked with partners to ensure the cost increase was just $1 more across the brand’s product range. “We still want to keep it affordable because, as a young woman, I know how important it is for consumers to adhere to a beauty maintenance budget – just a few dollars can alienate a loyal customer.”
Singleton pointed out that consumers should show companies like hers some grace as they navigate uncharted territories.
“When talking about these smaller Black and indie brands, we operate off smaller margins, so if you compare me to a Procter & Gamble, P&G has multiple income lines from everywhere. They can absorb the costs tariffs incur. Our company is in the position to be hurt by these trade wars, the DEI divestment and the fallout from that.”
Singleton explained that big box retailers–like Target and Walmart–DEI rollbacks are the straw that could break the backs of struggling Black beauty brands. While the companies previously stated they would dedicate resources to supplier diversity, they have since released statements confirming they would shift away from those promises.
“Consumers are saying they’re done with Target, but as a leader in this space, I know how detrimental that can be for smaller companies already stretching themselves to meet fiscal demands that the present administration is imposing on the country.”
On the contrary, Neal pointed out that smaller brands are at an advantage in this current climate.
“This is a great time to strengthen your direct-to-consumer structures and focus on funneling customers to your website to purchase products,” he said. “Garner trust with them through consistent communication on social media and focus on the winning SKUs.”
Roseme added, “Emerging millennial-run brands that don’t have a larger footprint typically have more control over their inventory. Lean into that and nurture your community—look to your evangelists and offer services like a membership or subscription plan, partnering with other brands. Think of ways to get back to your customers’å’ eyes and hearts.”