This year’s Christmas in the United States feels a bit quieter than before.

It’s not because the weather is colder, but because people’s hearts have grown colder.

Under the sudden tariff hikes imposed by Trump, prices for Christmas gifts and toys imported from China have risen to some extent. For ordinary consumers, this may just mean a few extra dollars in their shopping carts, but for importers already operating on thin profit margins, it represents a critical line between survival and failure.

As a result, a seemingly absurd “solution” has emerged: to avoid tariffs on finished “Santa Claus” products, some businesses have resorted to disassembling Santa Claus into parts—such as the head, torso, and limbs—exporting them from China to a third country, reassembling and relabeling them, and then shipping them into the U.S. market.

According to media reports, the overall cost of this convoluted process doesn’t differ much from simply paying the tariffs directly, and in some cases, it might even end up being more expensive. Yet, despite this, the practice has been widely adopted. This raises the question: Does this “dismemberment” approach hold any value in countering geopolitical risks?

1. Why Choose “Dismemberment”?

As the saying goes, “What exists is reasonable.” The fact that businesses choose to dismantle a complete Santa Claus into parts for export, only to reassemble them for “re-export,” clearly isn’t done out of sheer boredom. This phenomenon vividly illustrates the absurd yet real forms that individuals adopt to counter institutional risks in the current era of “profound transformations unseen in a century.”

From a business rationality perspective, many might instinctively question why companies would go through such trouble if it doesn’t save much money. However, when viewed from the perspective of these businesses, the choice becomes less surprising. After all, the Christmas goods industry is highly competitive with razor-thin profit margins. For some companies, saving even 1% to 2% in costs can mean the difference between survival and failure. In such a context, any opportunity perceived as “compliant tax avoidance” is unlikely to be ignored entirely.

Moreover, based on my observations, the significance of such operations for many small and medium-sized enterprises (SMEs) extends beyond mere numbers on the balance sheet. More importantly, it sends a message to their suppliers, channels, shareholders, and employees: “We are actively responding to risks, not passively waiting for the tariff hammer to fall.” Even if the approach itself is inelegant or even absurd, in a highly uncertain environment, this “dismemberment” tactic becomes a necessary gesture.

As the saying goes, “Difficult times come and go.” In essence, this is a reluctant choice forced upon businesses by geopolitical risks. When external stability weakens, the goal of companies is no longer to find the long-term optimal solution but to avoid being “knocked out” by a single blow, such as a sudden tariff hike.

2. Can “Dismemberment” Truly Counter Risks?

Undoubtedly, this “dismemberment” approach runs counter to productivity development and market economy logic, making it unsustainable in the long run. After all, the risks don’t disappear; they merely shift from explicit tariff rates to more hidden and dispersed friction costs. These include multi-country transit, repeated customs clearance, reassembly, compliance labeling, and increased complexity in supply chain coordination. Each step carries the potential for unexpected issues that could erode the already slim profit margins.

Often, while tariffs may appear to be “avoided” on paper, the reality involves higher management costs, longer delivery cycles, and greater uncontrollable risk exposure. For SMEs in particular, this complex cross-border supply chain structure can actually reduce overall risk resilience. If a single link in the chain—be it policy changes, logistics disruptions, or tightened compliance—fails, the entire operation could collapse instantly.

More critically, this approach doesn’t eliminate institutional risks; it merely postpones them or even creates new uncertainties. If Santa Claus can be disassembled today, what about televisions and refrigerators tomorrow, or even new energy vehicles the day after? When coping strategies require constant adjustment and reconstruction, businesses find themselves in a passive state, perpetually reacting to rules rather than shaping them.

From this perspective, “dismemberment” is not a solution to counter risks but more like a short-term painkiller. It alleviates immediate pressure but fails to address long-term trends. Worse, it may gradually erode a company’s ability to anticipate and plan for the future through repeated ad-hoc responses.

3. What Are the Benefits of “Dismemberment”?

As a passive coping mechanism, “dismemberment” is hardly a good thing in itself. However, as I’ve observed in my research on foreign-related legal work in recent years, if it weren’t for the “great transformation,” the frequent cross-border trade disputes, and the evident clashes in legal and institutional frameworks, niche subjects like International Law, Private International Law, and International Economic Law would likely remain overlooked. For instance, as a “local lawyer,” I only remembered terms like FOB (Free on Board) and CIF (Cost, Insurance, and Freight) from my bar exam years ago, with no practical exposure to such cases in my daily work.

The same logic applies to many SMEs engaged in foreign trade. In the past, these businesses could operate stably by focusing on a single export market, a set of customs procedures, and a straightforward pricing logic. However, amid frequent changes in tariffs, sanctions, and rules of origin, this “single-threaded capability” has begun to fail. Companies are now forced to explore third-country transit, trade agreement applications, and compliance boundaries. Even if the initial goal is mere survival, this process objectively embeds them more deeply into the multilateral trade system.

The benefits of this shift may not immediately appear on profit statements, but they manifest in a company’s risk awareness and decision-making processes. Many businesses are beginning to realize that markets are not perpetually stable, and rules are not set in stone. True risk management involves not just calculating costs but also understanding the underlying logic of institutional changes. Ultimately, the survivors are often not the most aggressive or the most conservative but those who learn to adapt to complexity the earliest.

From a longer-term perspective, “dismemberment” may only be a temporary expedient. However, what it forces companies to develop is a practical understanding of diverse markets, institutional differences, and geopolitical risks. Once these capabilities are internalized, even if the day comes when disassembling Santa Claus is no longer necessary, these businesses will no longer be mere participants walking a single, narrow path.