I’ve noticed a pattern across every 8-figure DTC brand trying to scale in Latin America.
They’re all leaking margin on one thing: customs surcharges.
The problem isn’t your carriers. It’s your pre-shipment process.
Here’s how to fix it.
Everyone sees the opportunity. With online sales in LATAM projected to grow by over 19% in the next five years, it’s a key growth market.
But most brands are paying a steep entry fee in fines, delays, and undeliverable packages.
Real talk: Some LATAM nations treat customs as a revenue stream.
They’re actively looking for errors on your paperwork. Incomplete or incorrect documentation is the number one reason your shipments get stuck, slapped with penalties, or sent back.
So, how do you stop the bleed? It’s simpler than you think. Let’s get tactical.
The majority of expensive customs screw-ups happen before your package ever leaves the warehouse. It’s a process problem.
First, lock down your pre-shipment checklist.
It comes down to three things: Documentation, Classification, and Valuation.
Get your documentation airtight. These are the non-negotiables: Commercial Invoice, Bill of Lading, Packing List, and Certificate of Origin. Stop using manual processes and spreadsheets. Use digital systems to kill the human errors that cost you money.
Next, classification. Incorrect Harmonized System (HS) codes are a rookie mistake that costs millions in fines and overpaid duties. There’s no excuse for getting this wrong. Double-check every code for every product shipping to a new market.
Finally, valuation. This is where you can get smart and save real money. Two strategies to use now: “First Sale Valuation” and “Cost Unbundling.”
First Sale lets you declare the value based on the first sale in a multi-tiered transaction—often the price from the factory to you, not from you to the customer.
Cost Unbundling means legally separating dutiable costs (like the product itself) from non-dutiable costs (like freight or royalties) on your invoice.
Both can significantly lower your dutiable value and, therefore, your tax bill.
Okay, so your internal checks are locked down. Now for a major unlock most brands ignore.
Use the cheat codes: Free Trade Agreements (FTAs).
FTAs like USMCA and Mercosur are your best friends in LATAM. They can eliminate tariffs, but they don’t work automatically. You have to do the work.
This is where many brands leave money on the table. They either don’t know an FTA applies or they fail to provide the right paperwork. These agreements have real power—just look at how Mexico successfully used USMCA negotiations to mitigate the impact of U.S. tariffs.
The move? Always provide a Certificate of Origin to prove your goods qualify.
And for agreements like USMCA, re-underwrite your claims with fresh documentation regularly to prevent penalties. Don’t assume last year’s paperwork is still valid.
But even with perfect paperwork and FTAs, LATAM can still be a beast. You need local intel.
This isn’t a DIY project. Hire a local guide.
Navigating the fragmented customs regulations of a dozen different countries without a local expert is a recipe for expensive failure.
Think of a local customs broker as your translator. They know the unwritten rules, have relationships with port authorities, and can unstick a shipment faster than you ever could from your desk.
The proof is in the results. One U.S. manufacturer successfully entered the notoriously complex Brazilian market by using an export/import strategy designed by local experts. That’s the ROI of having someone on the ground.
Now, one more thing to put on your radar.
Before you go, consider this a warning shot for 2026.
Mexico is expected to implement significant customs and tariff reforms as part of its 2026 economic package.
This isn’t a minor update. We’re talking about new import taxes on over 1,400 products.
Duties could reach up to 35% or even 50% for goods imported from countries that don’t have a free trade agreement with Mexico.
This is a huge piece of intel for your future planning. If Mexico is part of your growth strategy, you need to start preparing for this today.
That’s it. No more leaking margin on LATAM customs.
Go fix this.
