Challenge
In early 2025, U.S. trade policy changed almost overnight for an existing client.
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On April 2, 2025, the White House announced an Executive Order eliminating the duty-free de minimis exemption for parcels under USD 800 coming from China and Hong Kong, effective May 2, 2025.
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Only days later, on April 8–9, 2025, reciprocal tariff rates on Chinese imports were lifted dramatically, raising effective duties across key product categories.
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The consequence: Australian brands fulfilling U.S. customers directly from APAC were about to see tariffs assessed on the retail price (RRP) of every parcel, not on landed cost — a margin hit few could absorb.
What we did
We moved quickly with the General Manager to design a new supply chain into the U.S. that would protect margins and keep sales moving:
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Goods flow redesign: Within days we were sitting down with freight forwarders, 3PL providers, consultants and tax advisors to build a bulk-import model. By landing containers in the U.S. and fulfilling domestically, tariffs would apply at import cost, not at RRP.
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Margin & pricing analysis: We modelled tariff scenarios into product margins, stress-tested different pricing strategies, and worked through which levers to pull to maintain competitiveness.
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Compliance assurance: We vetted U.S. consultants and tax advisors to confirm customs treatment and sales tax exposure, giving the business clarity and confidence before execution.
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Execution sprint: From first planning session to U.S. stock on hand took just four weeks- including onboarding a 3PL, booking the first bulk shipment, finalizing HS codes and aligning reporting into finance packs.
The outcome
There was no interruption to sales during a volatile regulatory window, as stock was already in place when many competitors were scrambling to adjust. By shifting the duty base from retail price to landed cost, we protected margins and ensured the business could continue selling profitably. Having inventory on U.S. soil ahead of the May 2 de minimis removal gave the client a clear competitive advantage, with faster delivery times and a seamless customer experience. At the same time, sales tax and customs obligations were assessed and integrated into finance workflows from the start, giving the business full compliance certainty as it continues to scale.
