Importing Products for Distribution: A Practical Guide

Import success is a landed-cost model: product, ocean or air, fuel, origin fees, insurance, ordinary duty, Section 301 if it applies, broker, ISF, port/demurrage, dray, inland, and the cash you sit on for 50–70 days. A 'great' FOB that ignores 301 is not a cost. It is a wish.

Worked carton. $8.00 FOB. Ocean + dray $1.20. Duty $0.64. Broker/insurance $0.21. Landed $10.05. Sell $16.00. Gross $5.95 (37%) before warehouse and outbound. Domestic $7.20 + $0.40 inbound = $7.60 landed, $8.40 gross (52.5%). The import only wins if the domestic cannot fill or the brand is unique. Otherwise you bought risk.

Download the margin worksheet from Resources and run your SKUs before the PO. Sensitivity: +$0.40 ocean or a 10-day delay should not sink the year. If it does, you do not have a margin. You have weather.

U.S. Section 301 tariffs on certain Chinese-origin goods sit on top of ordinary duty and can add high-single to mid-double digits depending on the HTS and the list in force the day of entry. Price the list that exists, not last year's spreadsheet. USTR Section 301 and your broker are the sources.

Origin is a fact, not a shipping location. A 'we ship from Vietnam' story without substantial transformation is how you buy a penalty. If the deal only works if origin is a rumor, walk.

Lists and exclusions move. A January price list printed on October's duty assumption can give away a year. Rebuild landed cost when the broker sends a notice, not at the annual offsite.

ICC Incoterms 2020 allocate cost and risk of carriage. They do not decide title or whether the goods are legal to sell. Write 'FOB Shanghai Incoterms 2020,' not 'FOB.' Vague FOB is how you own a damaged pallet on a dock you have never seen.

EXW looks cheap and dumps origin pickup on you. FCA/FOB at origin with your forwarder is a common start. CIF/CIP means they buy main carriage and some insurance — read who files the claim. DDP means they play importer; many factories cannot. If they offer DDP and cannot name the IOR, you are the importer anyway.

Put the term on the PO, the commercial invoice, and the cargo policy. If those three disagree, the adjuster can read.

CBP expects a consistent commercial invoice, packing list, and bill of lading — description, qty, value, mid, HTS. Inconsistencies are holds. Holds are demurrage. Demurrage is how an $1,800 ocean 'save' becomes a $4,200 weekend.

Importer Security Filing is due 24 hours before lading on ocean. Late ISF is a $5,000-class problem. Send the broker the 10 elements while the cargo is still at origin.

Classify once, lock the HTS in the item file. Census Schedule B / HTS is the language. A creative 'parts' code that underpays duty is a retroactive bill with interest.

ROP on imports uses 45–70 days and a worse sigma than domestic. Static min-max through a rolled vessel is how you explain shorts to a banner. Recalculate when on-time slips.

Stagger POs on high-risk families so one box is not the season. Dual-source the A SKU domestically even at +15–20% if a miss closes a route. That premium is insurance.

Milestones CS can quote: booked, aboard, arrived, released, on your dock. 'The vessel is delayed' is not a milestone. A date and a next check-in is.

A cheap branded lot at origin without authorization paper is the same risk as a gray pallet in New Jersey — plus a bond and a 301 line. Do not import a brand you are not allowed to sell. The letter will find you after the duty is paid.

Serial and lot integrity should survive the ocean. If the plant will not put a lot on the case, you cannot recall and you cannot claim. GS1 on the case is not decoration on an import. It is how you find the wet layer.

No COI from a foreign plant is common; your cargo policy and their liability language have to fill the gap. No W-8/W-9 story for the U.S. payee is not common. Fix payee paper before you wire a deposit.

Compare actual landed to the quote: fuel, 301, dray, demurrage, defects. If fuel moved, update the item cost before sales quotes Q2. Silent cost moves are how 22% becomes 16% without anyone lying.

Feed OTIF and defect into the vendor file. A beautiful first container and a rotten second is a known pattern. The second container is the relationship.

Air to cover a miss is a failure code. Log it. Two airlifts on one SKU in a quarter means the ROP or the factory is wrong. Do not normalize $4.80/lb apologies.

Meet the plant at Expo West, AAPEX, or ASD before you give them a container. A face, a sample of the ugly SKU, and a photo of their booth's quality contact will tell you more than a month of chat. If they will not send a decision-maker to the show they already attend, they will not send one when the box is wet.

Bring your packet: credit, territory, Incoterm you want, HTS you think is right. Ask them to correct the HTS. The correction is diligence.

If you cannot travel, a third-party inspection before lading is cheaper than a surprise. Budget it on the first two boxes. Skip it later only when the file is boring.

Name the importer of record on the PO. If it is you, your bond, your HTS, your 301. A 'DDP factory' that cannot produce a U.S. IOR and a bond is still making you the importer with extra steps. Do not let sales accept a DDP email from a plant that has never cleared a U.S. entry.

Power of attorney to the broker is a controlled document. One broker of record per lane, a backup named, a revocation you know how to send. Two brokers filing two stories on one entry is how you meet CBP twice.

Related-party valuation and first-sale programs are above this guide. If a factory offers a valuation story that 'everyone uses,' call the broker and, if the dollars are large, counsel. Under-valuation is not a landed-cost tactic. It is a penalty with interest.

Air is a failure code unless the SKU is a true emergency and the customer will pay. A $4.80/lb lift on an $8.00 FOB novelty teaches purchasing that forecasts do not matter. Log every air shipment. Two in a quarter on one SKU means the ROP is wrong.

Split containers — some SKUs by air, the rest by ocean — only work if the item file can hold two landed costs. Average costing across air and ocean will lie to sales. Keep the lots separate until you know what you are doing.

Peak-season surcharges and rolled vessels are not the customer's problem unless you said so at PO. Build 10–14 days of slack into Q4 ocean if that is when your doors live. The CBP hold you did not expect is also not their problem unless you warned them.

Send a one-line: SKU, estimated dock date using the 80th percentile not the brochure, and whether they may promise it. If they may not, say 'not stocked, do not promise.' Hunters who sell a container that is still at origin will force you into air or a lie. Both are expensive.

When the date slips, send the new date the same day. CS should not learn from the buyer. A banner that hears 'you didn't tell us' will find a fee for that sentence.

After receive, tell sales what actually landed versus the PO — shorts, quality holds, leftover. A silent short is how they sell 40 cases of an item you received 28 of.

Cargo 'all risk' with a named place that matches the Incoterm. EXW with no cover from their curb is how you own a forklift hole you will never photograph in time. CIF insurance the factory bought may be minimum and may not name you. Read the certificate.

Warehouse legal liability at destination is not cargo. Once it is on your dock, your stock policy owns it. A gap between those two is a Saturday claim nobody pays.

If the broker says the goods are 'general average' after an incident, call them and the cargo underwriter the same day. Do not invent a process from a forum. The CBP hold and the average bond are different clocks.