This CSI article will be a little different. We do reader surveys and compile data. If the 2025 CSI-Annual & Market Report is not included with this issue, you should have already received it with the April issue of Metal Roofing. Working on the assumption that you have had enough of numbers for today. 

The question with any numbers is always what do they really mean and what should we do about it? An area where a lot of numbers have been released recently is tariffs. I understand tariffs in theory. Theory always changes when faced with reality and implementation. 

The tariffs and trade agreements are going to be country, region, or organization specific. This means that there are too many possible alternatives to address and the situation is fluid, so by the time you read this, it would be actively wrong.

Tariffs can have a direct and significant impact on your business — from the cost of imported materials to project bids and profit margins. Whether you’re building post-frame barns in the Midwest, working on ag facilities, or supplying roofing and framing materials, understanding the mechanics of how tariffs are paid can help you make smarter decisions.

These are the basic steps for tariff payments:

Determine the Tariff Classification. Every product imported into the U.S. is classified under the Harmonized Tariff Schedule of the United States (HTSUS). Importers (or their customs brokers) use this classification to determine the applicable duty rate.

File Entry with U.S. Customs and Border Protection (CBP). The importer (or their broker) must file an entry summary (CBP Form 7501) and other necessary documentation. This includes commercial invoices, packing lists, and bills of lading.

Calculate Duties and Taxes. Tariffs are usually calculated as a percentage of the declared customs value (typically the price paid for the goods).

Pay the Tariff. Importers must pay duties at the time of entry or within a set period, often 10 working days after the release of the goods. Payment can be made through Automated Clearinghouse (ACH), CBP’s Automated Commercial Environment (ACE) or a customs broker, who pays on the importer’s behalf and gets reimbursed.

Customs Review and Release. CBP reviews documentation and may inspect goods. Once cleared, goods are released to the importer.

The U.S. Customs and Border Protection (CBP) collects duties at the time goods enter U.S. commerce, usually at the port of entry. This is before a contractor ever sees the product, and often even before the seller has been paid in full under typical Net 30 or Net 60 terms.

Importers — usually the manufacturer, distributor, or a customs broker acting on their behalf — must file paperwork declaring the goods and pay any applicable tariffs upfront or very shortly after arrival.

Another important point is timing. Tariffs are based on the date of entry into the U.S., not the date of order, payment, or shipment. This means a contractor or distributor can place an order under one tariff schedule, only to have the rate change while the product is in transit. This can be particularly relevant during tariff negotiations.

If a new 15% tariff kicks in while a container of goods is crossing the ocean, the importer will pay the higher duty upon arrival. That extra cost may not be in the original purchase price or contract, leading to some uncomfortable conversations or profit losses.

Because duties are due upon entry to the U.S., they can create cash flow challenges for seasonal or project-based businesses and companies attempting to minimize carrying inventory. Importers can use tools like Periodic Monthly Statement (PMS) via CBP’s Automated Clearing House (ACH) to consolidate duty payments for all imports in a month. This allows payment on the 15th business day of the following month.

In addition, some customs brokers and trade finance firms offer duty financing, essentially loaning the amount needed to cover the tariff for 30 to 90 days. This can help align duty costs with project cash flow.

One strategy to reduce tariff costs is to import parts and assemble the finished product stateside. This strategy, sometimes called tariff engineering, only works if the parts are imported under different classifications with lower duty rates.

CBP has strict rules about this. If all (or most) parts are imported together and they clearly form a complete product, CBP may still apply the full finished-good tariff. The key is whether the U.S. assembly represents a substantial transformation.

Another common strategy is to move production from a high-tariff country (like China) to one with lower or no tariffs (like Vietnam or Mexico). But CBP doesn’t allow companies to just “pass through” a different country.

To legally change the country of origin, the goods must be substantially transformed in the new country. That means real manufacturing or processing must take place — not just repackaging or minor assembly. If CBP finds that the transformation wasn’t meaningful, it will assign the original country of origin, and the higher tariff still applies.

Understanding how tariffs work allows you to:

• Ask better questions of your suppliers.

• Plan for cost changes during bids.

• Negotiate smarter if mid-project price changes occur.

Tariffs may seem like a problem for global corporations, but the ripple effects impact small contractors and regional suppliers. By understanding the mechanics of how tariffs work, how they’re paid, and how they impact pricing, you can better navigate today’s market for construction supplies and components. 

My takeaways would be:

If you have critical suppliers, learn about them and how they source their products. 

It is always good to have redundancy and multiple sources for critical products.

Plan ahead and plan for contingencies. I know a place you can get industry data to help with that. RB