Bridge trolls at the port

Last week, we left a thread open…

How did I get on the radar of Customs and Border Protection?

After some overseas wheeling and dealing, I had successfully gotten my first container of goods — logoed 8-lb bags — into the Port of Norfolk, VA.

I received a notice that the goods had been unloaded from the ship, screened by Customs, and then … crickets. My (now-former) customs broker said they’d “disappeared from [his] radar.”

Days passed. They remained “disappeared.” Disappeared, into some bureaucratic labyrinth, presumably guarded by an ancient troll captured and put to work by the US government to enact the Smoot-Hawley Tariff Act.

I pressed my broker. He promised immediate answers, but none came. Still, I showered with my phone.

Finally, a breakthrough … the broker called to say he’d found the container. It was being held by US Customs, on suspicion of “violating anti-dumping duties.”

A faint bell rang from a long-ago Econ class. ChatGPT, as it often does, played the role of external memory:?

Anti-dumping duties: Tariffs imposed on imported goods priced below fair market value to protect domestic industries from unfair competition.

In other words, the bags were manufactured in a country — in this particular instance, China — that the US believed was trying to flood our domestic market with cheap, low-cost bags, all in an effort to wipe out competition.

What this meant in practice: I’d owe several hundred dollars in storage fees each day that Customs investigated the claim (which could take a few weeks). And then be liable to pay a 200% fine levied on the cost of the goods themselves.?

Not great!

I tried to keep my cool. I’d done some research before jumping in head-first into the seas of international trade. Nothing I’d seen in researching these bags had led me to believe they’d be liable for anti-dumping duties.

Finally, I hit on a critical point: the anti-dumping duty applied only to rope-handle bags.

As deeply arbitrary as this all seemed, the fact that my bags didn’t have handles was about to save a fledgling business from a disastrous beginning.

We just had to get proof… someone at Customs needed to quickly check the bags. Because I was getting billed every day that went by.

We called every number at the port until, finally, we got someone to find and unbolt the container, pop open a case, and take photos of their beautifully non-handled contents.?

Survive and advance.

PS: I wrote the above last night while half-watching President Trump sign executive orders in the White House. I had just typed the sentence “We do now sell wonderful rope-handle bags — sourced from Mexico, which doesn’t carry an anti-dumping duty” when the president said he was considering a 25% tariff rate on Mexico.

This wasn’t entirely unexpected — and a 25% tariff on rope-handle bags is still a lot better than a 200% anti-dumping duty — but it brings up an important point: Things are, shall we say, fluid these days.

Will the US hit China with maximum tariffs on all its exports? Or will we wake up in a few months to Trump and Xi shaking hands on the Great Wall? Both extremes are plausible.

International trade is becoming a giant geopolitical game of whack-a-mole. And we happen to believe that the suppliers that will win are the ones that are quickest with the mallet.

Which is why we’re pushing ourselves to be extremely nimble and aggressive in using a diversified manufacturing base — from the US to Mexico to India to Columbia to China.

It’s the only way to ensure any continuity in pricing or reliability in supply.

We’re about to see who’s flat-footed and who can move with speed.