‘De Minimis’ Rules: Big Changes
2025 continues to bring uncertainty in global trade, and recent shifts in U.S. policy are creating ripple effects for international supply chains. For e-commerce brands, the end of the de minimis provision, which allows duty-free entry of shipments under $800, could mean higher costs and new challenges when fulfilling U.S. orders. These changes can significantly impact margins. Agility in sourcing and fulfillment is no longer optional, it’s essential.
Our partner NRI breaks down what the new regulations mean, what brands should watch for, and how businesses can prepare to stay resilient in this changing environment. An article by Jan Den Otter.
A Year of Trade Uncertainty
2025 has brought no shortage of uncertainty in trade. For brands moving products across borders, tariff changes have shifted from being an obscure topic for customs brokers and manufacturers to something you might overhear in line at the grocery store.
With a view to North America specifically; in Canada the tariff landscape remains relatively unchanged, removing one potential variable in an otherwise unpredictable year. In the U.S., however, it’s been a whirlwind of policy shifts, executive orders, and trade negotiations. Many believe we’re nearing the tail end of the rollercoaster — a welcome sign for brands that have been trying to make long-term plans while the goalposts keep moving. The real challenge hasn’t been just the changes themselves, but the unpredictability of when and how they’ll arrive.
The Uneven Burden of Tariffs
For many NRI clients manufacturing apparel, footwear, bags, and accessories, the shifts have been significant. While the fashion industry makes up just 5% of total U.S. imports, it accounts for more than 25% of total duties collected. The disparity is stark — the average U.S. tariff across all imported goods sits at about 2.5%, while apparel hovers closer to 14.5%.
Why Supply Chain Awareness Matters
In this kind of environment, it is vital for brands to pay close attention to the details of their own supply chain. Knowing where goods are produced, which tariff codes (HTS) apply, and how shifts in sourcing might impact costs – for better or worse – is critical. Manufacturing partners with facilities or relationships in multiple countries can be invaluable, allowing brands to pivot if tariffs spike in one location. It’s not just about having a Plan B — it’s about knowing exactly when to put that plan into action.
U.S. trade policy announcements are also worth watching closely. Increased political focus on certain countries, such as China, can serve as an early signal to model out potential cost implications.
Fulfillment Strategies in Flux
The ripple effects of these changes extend far beyond sourcing, fulfillment strategies are also shifting. Section 321, the U.S. de minimis provision, was one of the most effective tools for e-commerce brands in recent years. It allowed qualifying shipments under $800 in value to enter the U.S. duty-free, regardless of country of origin, and has been a game-changer for those fulfilling from Canada, Mexico, Australia, and beyond. But like many favorable trade provisions, it’s now facing change. Many brands have moved away from the model, while others still find it highly cost-effective when applied to products manufactured outside of China and will utilize it ‘til the last moment it’s available.
Turning Complexity Into Clarity
At NRI, our role is to cut through the noise, provide timely updates, and translate complex trade policy into actionable insights. We also connect our clients with specialists, such as brokers and trade counsel, who can provide deeper guidance. The goal is not just to help brands react quickly but to ensure they’re building resilience into their operations.
A Case Study in Agility
One example of this in action is our work with Pacmodo, a new brand launching during a particularly turbulent stretch of tariff policy updates. Initially, their fulfillment plan was based out of our Vancouver facility, including U.S.-bound orders. When the tariff environment shifted, we worked closely with them to develop an alternative strategy, ultimately moving fulfillment to our California distribution center. This pivot allowed them to avoid unnecessary tariff exposure and launch on time with confidence.
Building Agility Into the DNA
Experience has taught us that agility can’t be improvised — it has to be built into the foundation of a brand’s operations. That means planning for multiple outcomes, understanding cost structures inside and out, and developing logistics strategies that remain viable across different trade environments. From leveraging de minimis provisions to exploring bonded options or modeling landed cost scenarios across sourcing locations, the key is flexibility without compromise.
Looking Ahead
Looking ahead, change will continue, though hopefully without the same intensity seen in the first half of 2025. Trade policy is shaped by politics, economics, elections, and even public sentiment, so brands should anticipate a degree of fluidity. The smartest approach is to build adaptability into the company’s DNA: rehearse potential disruptions, model breaking points, diversify sourcing and fulfillment, and maintain relationships with partners who can help anticipate and navigate shifts.
Preparing for the Inevitable
Ultimately, no brand is alone in facing these challenges. Rising costs and strategy pivots are affecting companies across the board. The ones that will come out ahead are those that stay curious, maintain a close connection to their supply chain, and align with partners who are committed to their success. Disruption is inevitable — but with the right preparation, it doesn’t have to derail growth.