Tariffs and Tribulations

It’s Friday, so this should be our weekly new release post. But it’s not – we’ve had to put that on hold for a more important announcement.

Unless you’ve been hiding from the news under a blanket lately (and who can blame you?), if you move in any miniatures-related circles online you’ll doubtless have seen the news about the US ending the de minimis exemption, and a variety of other UK/EU manufacturers explaining how it affects them and their ability to ship to their US customer base.

The de minimis exemption is a lower limit at which incoming packages to the USA aren’t subject to any tariffs, duties or customs charges. The idea is that it saves customs officials the time and paperwork involved with processing lots of low-value packages. As of August 29th, this all ends, and everything coming into the USA will be tariffed at the appropriate country rate. For us, as we make most of our own stuff (and anything we buy in is also made in the UK), the rate is 10%.

It seems that the USPS wasn’t really ready for the huge increase in workload that this will entail, so they’ve pushed the responsibility for collecting these tariffs onto the sending postal services (in our case the Royal Mail – this is their post on the matter should you want to read it). Royal Mail are setting up systems to do this – but only for account customers. We don’t have an account, we buy our postage online as and when we need it, so where that leaves us for now we don’t know. We have no idea what will happen to packages shipped by RM’s online click and drop service (which we use). Which left us in a bind, and we were very worried for a while that we’d have to cease shipping to the US for the time being – and this would hurt, since the US accounts for over 25% of our orders.

However, we have been through a similar scenario before when Brexit happened and we had to find a solution for shipping to the EU which didn’t end up with our customers there being hit with large fees for import taxes. We use a specialist courier that handles import taxes for us and allows us to ship to the EU without any further fees being added on, and we think we can do the same for the US.

We’re going to put this system in place early so that we are ready for the 29th. As of next Tuesday (August 19th) we will add the 10% tariff to all orders to the US – we will then pay this to the customs service on your behalf when the parcel arrives in the US, so that you don’t incur any further fees or charges – what you pay at checkout will be it. This fee will be shown in the checkout at ‘Customs Duties and Fees’ so it’s clear what it is.

It means that all US orders from that point will be shipped by courier (we believe that it’ll be DHL, although we will try to confirm this). They claim a 3-4 delivery time, so it’s a pretty quick service. Balancing that, we have to send the parcels to a shipping hub at Heathrow, and it’s not cost effective for us to do that until we have several to send, so it’s possible that orders could get stuck in our outbox waiting for some others to send them with (our experience with EU orders is that we usually have enough to send around once a week). All of our EU and US orders will be sent together so that waiting time will hopefully come down (so good news for EU customers there).

We’ll be removing all other shipping options for the time being – if Royal Mail sort out a shipping solution that covers the services we use then we may return to them in future. The pricing looks to be comparable to RM and other couriers, so although we may have to adjust our shipping rates slightly (it looks like they may be slightly more expensive for very small parcels) there shouldn’t be a significant difference – we aren’t suddenly going to have to increase our US shipping rates by 50%.

We will still be able to deduct UK VAT (currently 20% on everything except books) from our online prices, so you’ll still be able to benefit from this. So as a quick example, if a US customer buys one of our Imperial Skies fleet packs priced at £24, the website will deduct VAT (which brings it down to £20) then add the 10% tariff taking the final price to £22.

If there’s anything about this that doesn’t make sense, or we haven’t explained it very well (quite likely), please feel free to contact us or send a message on one of our social media channels.