De minimis is gone. Every shipment now requires formal customs entry. Greenwich Mercantile gets DTC brands through the transition — with modern tools, flat pricing, and HTS audits that recover 4–8% of landed cost.
Book a 15-min ConsultationThe duty-free exemption for low-value imports has been suspended for all countries. Every cross-border shipment — regardless of value — is now subject to duties and formal customs entry. If you were shipping under Section 321, you need a new process.
Cotton t-shirts: 16.5% MFN + 7.5% Section 301 + 10% Section 122 = ~34% effective. Synthetic activewear: ~50%. Plastic sandals: ~55%. The line between “cheap to import” and “margin-eating” moved 30 points in two years and most brands have not repriced.
With tariffs stacking to 40% and beyond, a wrong digit in your HTS code doesn't just mean an overpayment — it means CBP flags, potential penalties, and delayed shipments. Classification accuracy is the foundation of your landed cost math.
Traditional customs brokers are built for container-load importers with logistics teams. DTC brands need a broker that works at e-commerce speed, with transparent pricing, a self-service portal, and visibility into landed cost before goods ship — not faxes and phone trees.
We register you as an importer of record (CBP Form 5106), set up your ACE portal access, post a continuous bond, and file your first formal customs entries within 30 minutes of onboarding.
Expert-led tariff classification for your full product catalog. Periodic audits typically recover 4–8% of total duty by catching fiber-blend, garment-construction, and footwear-upper composition errors.
For brands using sourcing agents or trading companies, First Sale typically reduces declared customs value by 8–15% — saving 8–15% on every duty line. Documented and audit-defensible.
Recover up to 99% of duty paid on goods later exported. For Shopify Markets brands selling 10–20% internationally, drawback recovers $50K–$200K per year on a $5M program.
Time tariff exposure to your advantage. Hold inventory in FTZ during volatile policy windows; withdraw at the rate in effect. Especially valuable through the July 24, 2026 Section 122 transition.
ISF (10+2) on every ocean shipment, 24+ hours before loading. FDA, FCC, CPSC, EPA, USDA filings as required. Late ISFs trigger $5,000 penalties — we make sure that never happens.
Most DTC brands moving from de minimis to formal entry assume the transition is bureaucratic. It is, but the bigger surprise is how much landed-cost math changes. Pricing models built around $0 duty and ~5% misc fees are now wrong by 25–50 percentage points on apparel and footwear from China. The brands that handle this well treat the transition as a finance project, not a logistics one. Here is the 90-day arc that works.
Days 1–3 — Stand up the entry stack. File CBP Form 5106 to register as importer of record (instant for most U.S. LLCs and C-corps using EIN). Post a continuous bond (same-day issuance for face values under $100K). Get ACE portal read-only credentials. Configure ISF workflow with your forwarder. By end of day 3, you can file live entries.
Days 4–14 — Classify the catalog. Each SKU needs a 10-digit HTS code. For DTC apparel, beauty, and home, expect 6–12 distinct codes across the catalog. Pull bill-of-materials and fiber-content specs from your factories. Resolve all 36% / 64% blend boundaries. Where supplier specs are ambiguous, get lab results. By end of week 2, you have a master classification spreadsheet that becomes the single source of truth for every entry.
Days 15–30 — Re-cost the catalog. Build landed-cost models for your top 50 SKUs at current MFN + Section 301 + Section 122 + MPF/HMF. The numbers will surprise you. Check unit economics on your top 10 best-sellers against retail price; flag SKUs where new effective duty rates have eroded margin below your gross-margin floor. Decide whether to reprice, reformulate, or sunset.
Days 31–60 — Optimize. Run an HTS reclassification audit to catch the 4–8% of duty being overpaid through wrong codes. If you use a sourcing agent or trading company, evaluate First Sale for Export. If you sell internationally, set up duty drawback. If you import $5M+ annually, evaluate FTZ activation or third-party FTZ operators. Each of these is a 4–8 week implementation that pays back inside 90 days.
Days 61–90 — Hardening. Establish PGA workflows for any FDA-regulated products (beauty, supplements). Build an ISF compliance dashboard. Set up post-entry tariff-news monitoring on the Section 301 investigation conclusions expected July 24, 2026. By end of day 90, customs is no longer a fire drill — it is a routine finance discipline with optimization roadmap baked in.
The customs cost stack scales with import volume in mostly predictable ways. Use this as a sanity check on your current spend and a planning tool for the next stage of growth.
| Annual Imports | Entries / yr | Broker Fees | Bond | ISF | PGA | Typical Total |
|---|---|---|---|---|---|---|
| $100K–$500K | 10–30 | $2K–$5K | $400–$600 | $300–$2K | $0–$1K | $3K–$8K |
| $500K–$2M | 30–80 | $5K–$12K | $400–$800 | $1K–$5K | $0–$3K | $7K–$20K |
| $2M–$5M | 80–200 | $12K–$25K | $600–$1.5K | $3K–$10K | $0–$8K | $15K–$45K |
| $5M–$20M | 200–500 | $25K–$60K | $1K–$4K | $8K–$25K | $0–$20K | $35K–$110K |
| $20M+ | 500+ | $60K+ | $3K+ | $25K+ | $10K+ | $100K+ |
Three things to notice. First, broker fees as a percentage of landed cost generally fall as you scale: a brand at $500K imports pays ~3% of landed cost on broker fees, while a brand at $20M pays ~0.5%. Second, the inflection point for FTZ activation is generally $5M+ annual imports — below that, third-party FTZ operators or bonded warehouses are more cost-effective. Third, this table excludes the actual duty paid, which dwarfs all of the above. On $5M of imports at a 34% effective duty rate, you are paying $1.7M in duty — recovering even 4% of that through HTS optimization is $68K, which by itself pays for the entire customs stack.
Customs entry happens at the U.S. import boundary, independently of Shopify. Your forwarder hands the broker the commercial invoice, packing list, and bill of lading. Greenwich files the entry through ACE, releases goods to your 3PL, and notifies your inventory system. For brands using Shopify Markets to sell into Canada, EU, UK, or AU, the outbound shipments do not require U.S. customs entry but should be tracked as exports for duty drawback purposes. Shopify Markets’ built-in duty calculator at checkout is a useful customer-facing approximation, but the actual duty paid at U.S. import is what we file against.
FBA inbound shipments require formal customs entry before goods can be transferred to an FBA warehouse. Amazon does not act as importer of record — you do. The seller (you) must have your own EIN, IOR registration, bond, and broker. Amazon will reject inbound shipments that do not have proper customs clearance. Greenwich files the entry on your behalf, then your forwarder routes the cleared goods to the correct FBA fulfillment center per your inbound shipment plan. Most FBA-focused brands also need PGA filings (FDA on supplements/beauty, CPSC on toys/baby, FCC on electronics).
The customs workflow is platform-agnostic. Your tech stack handles the front-of-funnel; the customs entry happens at import regardless of what platform you sell on. The integration points worth wiring up: (1) HTS code per SKU stored in your product catalog as a custom attribute, (2) country-of-origin per SKU, (3) commercial invoice generation from your order data for your forwarder, and (4) post-entry data feed for landed-cost reporting. Any modern e-commerce stack can be wired to feed customs data; the broker work is the same regardless of platform.
TikTok Shop sellers operating from China have historically relied on de minimis to ship direct-to-consumer under $800. With Section 321 suspended, that model no longer works at scale. The two viable paths are (1) bulk import to U.S. fulfillment with formal entry, then ship domestic from U.S. warehouses, or (2) keep cross-border but accept formal entry and full duty on every shipment, which destroys the price advantage that made the model work. Most surviving TikTok Shop brands have moved to bulk import + 3PL fulfillment in the past 12 months.
The five most common (and most expensive) DTC classification errors we see in the brands we onboard:
The traditional customs broker model was built for container-load shippers with their own logistics teams. The interface is email, fax, phone calls, and PDFs. For DTC brands shipping 30–500 entries per year across air and ocean from multiple origins, that interface breaks down. The brand-specific things a modern broker should give you, which Greenwich is built around:
If your current broker is missing more than two of those, you are paying full price for half the product. The good news is that the switching cost is low: a customs broker change requires no CBP filing, just a Power of Attorney signature and a 1-2 week handoff to migrate active filings.
Yes — even more than before. With Section 321 de minimis suspended for all countries in 2025, every shipment over $0 requires formal customs entry. A licensed customs broker files your entries, classifies your products, posts your bond, and represents you to CBP. There is no legal path to import as a U.S. business without a broker (or your own licensed individual on payroll, which DTC brands rarely have).
Section 321 of the Tariff Act allowed imports under $800 to enter duty-free with informal entry. In early 2025, the administration suspended Section 321 for goods from China, then expanded the suspension to all countries. Every cross-border shipment now requires formal entry, MFN duty, any applicable Section 301/232/122 surcharges, and MPF/HMF. There are no exceptions based on shipment value as of April 2026.
Greenwich Mercantile charges flat-rate per entry — any value, any origin, any HTS code. Most DTC brands at $1M–$5M annual import volume pay $8K–$15K/yr in broker fees plus $400–$600 for a continuous bond. ISF is $25–$75 per ocean shipment. PGA filings (FDA, FCC, CPSC) are $25–$100 each. The full cost stack is detailed in our customs broker cost guide.
First filing within 30 minutes of onboarding for brands that already have an EIN. The bottlenecks are Form 5106 (importer of record registration, processed by CBP within hours), bond issuance (same-day for continuous bonds under $100K face), and HTS classification (1–3 days for a typical DTC catalog of 50–200 SKUs). Most brands are filing live entries by day 3.
Customs entries are filed by your broker through ACE — independently of your sales platform. Your forwarder provides the commercial invoice, packing list, and bill of lading. Greenwich pulls the HTS classification from your catalog, files the entry, and notifies you when goods are released. For Amazon FBA, customs entry is required before goods can be transferred to an FBA warehouse. For Shopify Markets, customs entry covers the U.S. import; outbound Shopify Markets shipments to international customers do not need U.S. customs entry but may need export documentation for duty drawback.
Most DTC catalogs concentrate in 4–8 HTS chapters: apparel (Chapters 61, 62), footwear (64), beauty and personal care (33), home and kitchen (39 plastics, 73 steel, 69 ceramic), bags and accessories (42), and consumer electronics (85). Within each chapter, the 10-digit code depends on material composition, construction, and end use. Misclassification at the chapter level is rare but common at the heading and subheading level — and even a 1-percentage-point error compounds across thousands of units.
On a $5M annual import program, an HTS reclassification audit typically recovers 4–8% of total duty, or $150K–$400K per year. First Sale for Export adds another 8–12% reduction in customs value, recovering $100K–$250K per year on top. Combined, the moves typically pay for themselves within 60–90 days and continue compounding annually. The audit work is 10–30 hours of broker time on a mid-size catalog.
Mixed. The Section 122 surcharge (10% blanket on most countries) expires July 24, 2026 by statute. The administration intends to replace it with new Section 301 country-specific tariffs and expanded Section 232 product-specific tariffs. For DTC apparel from China, effective rates are likely to stay at or above current levels. For some product categories from non-China origins, rates may temporarily drop during a Section 122-to-Section-301 transition gap. See the Section 122 expiration analysis for scenarios.
Yes. Up to 99% of duty paid on imports later exported (or used in exported finished goods) is recoverable through duty drawback. For DTC brands with 10–20% international revenue (typical for Shopify Markets brands selling to Canada, EU, UK, AU), drawback recovers $50K–$200K per year on a $5M import program. Claims can be filed up to 5 years after import. The setup takes 4–8 weeks; the recovery is ongoing. See our duty drawback guide.
A Foreign Trade Zone is a designated area inside the U.S. where goods can be stored, processed, or assembled without paying duty until they enter U.S. commerce. For DTC brands, FTZs offer two benefits: tariff-rate timing (withdraw at the rate in effect, not the rate at import) and weekly entry consolidation (file one entry per week instead of per shipment, lowering MPF). FTZ is generally cost-effective for brands at $5M+ annual imports or those holding inventory across volatile tariff regimes. Smaller brands typically use third-party FTZ operators rather than activating their own. See FTZ vs. bonded warehouse.
Importer Security Filing, also called ISF or 10+2, is a CBP filing required at least 24 hours before ocean loading at the foreign port. It applies to all ocean shipments to the U.S. and includes 10 importer-side data points and 2 carrier-side data points. Air freight does not require ISF. Late or missing ISFs trigger $5,000 penalties per violation, so it is one of the most-watched filings in DTC import compliance. Greenwich files ISF for every ocean shipment automatically. See ISF filing guide.
USMCA still exempts qualifying goods from Mexico and Canada from MFN duty if they meet the rule of origin. CAFTA-DR exempts qualifying goods from Central America. GSP and AGOA programs offer duty-free access for some products from designated developing countries (subject to program reauthorization). None of these programs apply to goods of Chinese origin, even if they ship through Mexico, Canada, or Vietnam — the country of origin determination requires substantial transformation, not just transshipment.
Book a 15-minute landed-cost review with Cameron. We'll set up your formal entry process, audit your HTS codes, and find the First Sale and drawback opportunities in your program.
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