Tariff Resource Guide
Tariffs on imported goods impact both importers and exporters, creating challenges in a shifting trade landscape. Businesses that plan ahead and adapt their supply chains gain a competitive edge. GO-Biz encourages California businesses to stay informed and proactively plan for tariff-related challenges. Below, you’ll find a collection of resources to help your business navigate tariffs, optimize operations, and remain competitive in the global marketplace.
Manage Product Supply Chains
Understanding product supply chains is crucial to making strategic risk management decisions. Mapping supply chains allows businesses to better understand their vulnerability to trade barriers and other potential disruptions in order to minimize the potential effects.
- Recognize potential vulnerabilities that could lead to disruptions.
- Establish backup suppliers to avoid reliance on a single source.
- Encourage existing suppliers to diversify their sourcing locations. Get to know your suppliers’ suppliers.
- Shift from just-in-time to just-in-case inventory management. Increase safety stock to prepare for potential delays.
- Import goods before new duties take effect to reduce costs.
- Source from countries with lower tariff rates or free trade agreements (FTAs) with the U.S.
- Enhance supply chain security with Customs Trade Partnership Against Terrorism Certification (CTPAT). The CTPAT program helps businesses improve supply chain security and gain operational benefits, including:
- Fewer Customs and Border Patrol inspections and faster customs clearance.
- Priority processing and shorter wait times at border crossings.
- Access to dedicated Supply Chain Security Specialists.
- Train employees in supply chain management. The Employment Training Panel (ETP) provides funding for companies to train employees. Businesses determine their own training needs and receive assistance in applying for funds.
Reduce Your Exposure to Tariffs
To reduce their exposure to tariffs, businesses can employ strategies such as tariff engineering, duty drawback programs, and foreign trade zones to reduce costs while remaining compliant with Customs regulations.
- Work with a permitted customs broker.
- Employ tariff engineering. Businesses can legally modify product materials or classifications to qualify for lower duty rates. For example, if cotton products have lower tariffs than nylon, consider switching materials.
- Leverage Foreign Trade Zones (FTZ). FTZs are geographic sites in the United States that are outside of US Customs territory. In these zones, goods can be held or manufactured and are not subject to duties until they leave the site and enter customs territory. There are 18 FTZs in California.
- Use Customs bonded warehouses to delay or avoid duties. Bonded warehouses allow businesses to store imported goods duty-free until they are sold or exported.
- Claim refunds on paid tariffs with duty drawbacks. Duty drawback programs enable businesses to recover up to 99% of duties paid on imported goods that are later exported.
- Import goods with Temporary Importation Bonds (TIBs). TIBS allow businesses to bring goods into the US without paying duties, as long as they are reexported within a specific timeframe.
Stay Informed on Trade Policy Changes
Trade policy can shift rapidly, which is why tracking updates is crucial to avoiding and planning for potential disruptions.
- Refer to the following resources for the latest news on tariffs and other trade issues:
- Attend webinars and other informational events to hear from experts on the latest developments in trade policy. Businesses can check GO-Biz’s Export Training webpage for new events, webinars, and trainings.
