For nearly 20 years, customs classification was regarded as a filing task. When a product arrived, someone found the correct code, entered it into the enterprise resource planning application or product catalog, and closed the file. This method worked because the rules changed slowly. A classification made in January was still suitable for a decision in June.
The rules no longer move slowly. As of August, 21 2026, the U.S. is on Revision 16 of the 2026 Harmonized Tariff Schedule. By the time you read this, the number will likely be higher. At the same time, the suspension of duty-free de minimis treatment means goods valued at $800 or less that previously entered the U.S. with minimal customs friction are now subject to duties, taxes and fees.
Each of these changes can be absorbed. Collectively, they change the nature of classification: it stops acting like master data and starts acting like a decision with a finite shelf life.
Trade compliance teams are measured on finding the defensible 10-digit code, and rightly so. The difficulty is that the code is only one input into the number the rest of the business cares about: landed cost.
Take an importer with 10,000 active SKUs, each classified correctly and logged. A Section 232 or Section 301 modification lands. In most cases, the product description and code remain unchanged. What changes is everything attached to the code: the applicable duty rate, exclusions tied to country of origin, antidumping exposure, and the valuation basis used to calculate the bill. Since April 2026, the Section 232 derivative rate applies to the full customs value of a finished good, not just its metal content.
The code is still correct. What has changed is the cost model on top of it, and in most cases, this isn’t discovered until the entry summary arrives. By then, procurement has agreed prices based on the old duty assumption, finance has forecast cash that has already left, and elsewhere there is freight that has not been checked.
De Minimis: The Volume Stress Test
The operational weight of all this shows up most clearly in low-cost imports. Customs and Border Protection recorded more than 1.36 billion shipments claiming de minimis treatment in 2024, against 139 million a decade earlier.
Removing the exemption adds duty to those shipments and work to each one. Commercial data must be collected, origin verified, a code assigned, and duty calculated, all while the goods are moving. Carriers, brokers, marketplaces and forwarders have absorbed this work into teams sized for the old volume.
When a parcel can’t clear until its data is correct, it sits at the gateway hub. Delivery windows slip, and the cost appears in customer service rather than the duty line. This is one reason it took time for anyone to recognize this as a capacity problem.
The breakdown is easy to see on a typical commercial invoice covering, for example, 640 lines of parts.
The customs team has probably handled 550 of those parts before and recently. A dozen or so are genuinely new. A few include vendor descriptions too vague to classify without going back to ask. And a handful sit under a tariff measure that changed since the last shipment went through.
Reviewing all 640 lines with the same process treats four very different situations as one. Broker queues lengthen, demurrage accumulates, and licensed specialists spend most of their week rechecking lines that haven’t changed. In a stable policy environment, that inefficiency was survivable. At the current rate of change, it becomes the constraint on how fast freight moves.
The useful question on that invoice is: What has changed since last time?
Adding People Won’t Close the Gap
The instinctive response to rising workload is to hire or push more of it to a broker. But importers should be cautious about going that.
Customs expertise is valuable because it involves judgment, which repetitive re-checking doesn’t require. Every hour a licensed specialist spends confirming that an unchanged part is still unchanged is an hour not spent on valuation questions or audit exposure. Spreadsheets, disconnected reference databases, and quarterly catalog reviews were adequate when the rules held still for a year at a time. They’re being asked to do something different now.
The organizations coping well have made three changes to how they design the work. They keep the reasoning behind each classification alongside the code, so when a measure changes, a team can see in seconds why a decision was made instead of restarting the analysis. They connect product catalogs to tariff modification feeds, so a policy update flags only the SKUs it affects and leaves the rest alone. They also push duty changes straight back into procurement and landed-cost models, so purchase orders can be adjusted before freight is booked rather than after it clears.
Technology has an obvious role in this. But buying another system alone doesn’t answer the question. What matters is whether the operation can identify what changed and act quickly enough to be useful.
The wider shift is that Customs has moved inside the operating envelope. A tariff change affects landed cost; landed cost affects sourcing; sourcing affects routing and inventory; and a Customs hold affects the customer. Static unit-cost comparisons have become structurally unreliable, and sourcing decisions need to be modeled dynamically. The same logic applies further downstream. Static classification data is worth less when the environment around it keeps moving.
The Advantage Is Response Time
Nobody knows what the next 12 months of trade policy will bring, and building an operation around a forecast of it seems unwise. What a business can control is how quickly it responds once something lands.
That is a small set of practical questions. When a measure is announced, how long does it take to identify every affected product? Can you tell which shipments already in motion are exposed? Can you see why a previous classification was made without redoing the work? And can you separate routine volume from cases that need a broker to review?
The companies that come out of this period ahead will be the ones whose operations can absorb change without adding headcount or slowing freight down. That capability is becoming as much a source of margin as sourcing strategy ever was.
Adrian Smith is co-founder and chief executive officer of Ripple.