Citing the elimination of the De Minis tariff exemption, an increasing number of miniatures manufacturers are pausing all sales and shipments to the United States. Let’s take a look at what exactly is going on.
In case you were unaware, the US has been on a tear since early this year slapping tariffs on everything coming into the country. Well, except things with a powerful enough lobby or connection to the levers of power. The size and spread of these tariffs or proposed tariffs have fluctuated wildly, but one thing that has seemed relatively safe has been small volume imports thanks to a special exemption. De Minimis, Latin for “of little things” and High Gothic for “The Minis,” was the term for this exemption, which applied to shipments of goods worth less than $800. If you ordered a couple boxes of Perry or Victrix minis, that would be well below $100, and thus you would not be required to pay a tariff on your purchase.
With the elimination of the De Minimis exemption all orders, great and small, will have a 10% tariff applied to them. This might not sound like a huge amount, but it is enormously consequential in an industry with such tight margins and low volume. And yes, the margins are tight, even though the individual box you are buying cost pennies to make. I am not going to break down the entire supply chain and explain how tariffs disrupt it all, but you should watch the video below for more info:
Suffice to say that a hobby shop selling you a box of minis is likely making somewhere between 20-30% as their Return On Investment, or profit, if they they are doing everything right. You can see how being forced to pay a 10% tariff immediately eats up anywhere from a third to half of that in one go. This essentially makes it a losing proposition to carry this product. No, the hobby shop is not losing money by selling the product, but they aren’t making enough money to do much else, like pay employees and utility bills.
But this isn’t the most immediate problem forcing the stoppage of sales and shipments from Britain to the US. Apparently, there is a factor of the new trade agreement between the two countries that requires the Royal Mail (the British mail service) to assess the tariffs before the shipments go out. This was all set to happen in a year or more, but it was just moved up by an executive order, and the Royal Mail apparently does not have the infrastructure in place to start assessing these tariffs yet. British companies don’t know how much to pay, who to pay it to, or even how to pay it, so they are simply suspending all shipments for the time being.
Victrix stated in their notification that they expect the situation to be resolved in the next 7 to 10 days. Whenever that happens, expect the cost of the tariffs to be passed right through the chain of supply to us, the purchasers. In the meantime, it is not a bad time to start looking at some American made alternatives, although you should expect their prices to rise along with everyone else’s, which is a well documented effect of tariffs as well.
How are you feeling about all this? Let us know in the comments.
And remember, Frontline Gaming sells gaming products at a discount, every day in their webcart!
