Sex toy company removes 'Trump tariff surcharge' amid trade deal

This week, President Donald Trump's Treasury Secretary Scott Bessent announced a temporary trade deal between the U.S. and China. For 90 days while negotiations continue, U.S. tariffs on China will be slashed from 145 percent to 30 percent, while China's reciprocal tariffs on U.S. goods will go down from 125 to 10 percent.

For many industries that rely on China to manufacture goods, this is an (interim) relief. As Mashable previously reported, the vast majority of vibrators sold in the U.S. are made in China, so the trade war could kill their buzz. 

In April, the sex toy company Dame announced a "Trump tariff surcharge" for its customers: $5 when Trump set the tariff rate at 54 percent and $15 when the rate surged to 145 percent. Now, Dame has removed the surcharge due to the deal.

"We made the point," Dame co-founder and CEO Alexandra Fine told Mashable. "[The tariffs are] not as high, and the surcharge is a terrible customer experience and confusing. People were kind of confused by it." Fine also posted on LinkedIn about the change.

The surcharge initially showed up when customers checked out. 

"I was giving people the experience that I was having," Fine continued. When shipping products from China, she received a higher bill than expected, and she passed that on to customers. She compared it to telling employees they weren't getting Columbus Day (now sometimes known as Indigenous Peoples' Day) off.

"Then I realized, 'Oh, now I'm like Columbus, because I'm making everybody work on a day that everybody else has off," Fine said.

So Dame stopped charging people the surcharge but said the product was $15 more (though the customer wasn't paying it) to be transparent about how tariffs are impacting the company. But that was still confusing. 

With the surcharge now removed, Dame will absorb the additional costs of the 30 percent tariff rate. "In this case, it doesn't make sense to drop your prices all the way back down, because it's still 30 percent," she said. "That being said, we are going to be dropping our prices pretty much back to normal. So that's really exciting."

Asked whether she foresees Dame increasing prices, Fine said, "Mostly no…We're going to eat most of it." Dame wants to be competitive in the market and offer quality products at reasonable prices.

When preparing for the 145 percent tariffs, Dame decided to aggressively plan. The company held more inventory in China ("splitting" orders) and opened a warehouse there, too. Now that tariffs are down, Dame isn't doing the former — instead bringing all of the orders to the U.S. — but it'll keep the warehouse. 

While the online customer reaction to the surcharge was overall positive due to the company's transparency, it didn't translate into sales. The rate of completing a charge on Dame's checkout page dropped 33 percent on the first day it implemented the surcharge compared to the week before, Fine said.

The tariffs also caused instability when selling to retailers who distribute Dame products. Shifting prices is more complicated when selling through third-party companies than when selling only on the company's own website.

Even though the surcharge is removed, Fine plans on continuing to advocate for freer trade agreements. "I am definitely relieved from a cash perspective, but from an operational perspective, or a general [perspective], am I happy? No," said Fine. "This is still not ideal."