Issue link: https://iconnect007.uberflip.com/i/1547450
40 SMT007 MAGAZINE I NOVEMBER 2026 the main figure typically reported in news headlines. For any given shipment, the stack depends on: • Importing country • Country of origin • Harmonized Tariff Schedule (HTS/HS) classification • Customs value • Trade agreements or preference programs • Whether the product/item is subject to trade remedies or special measures • Entry type and logistics route The HS line is the classified item, and the duty stack is on the HS line. The HTS code is what you type to open that line. With TariffVault, every layer of the stack on that line is in a single workspace, so the product's cross-border cost is the full stack. TariffVault scores the full tariff stack on the exact good you enter, so the absorb, pass-through, or relo- cation decision can be made before the program is committed, not only the landed cost and the risk of shifting production. So, understanding the full tariff stack goes beyond simply knowing the duty rate. How does that infor- mation affect the sourcing and manufacturing deci- sions EMS companies make? The tariff stack affects true landed-cost modeling, which is what supply chain teams optimize for, not the lowest tariff rate. Knowing the full stack helps teams make more effective sourcing, assembly location, or inventory strategy decisions. On some electronics from China, for example, the total import duty is above 40%. That duty applies to the product's customs category, which is the HS and HTS code mentioned earlier. We show you each duty in that total, all on one screen. Added together, they are the full import duty, or tariff stack, on the product. Here are some examples. • A higher-cost supplier in a Free Trade Agree- ment (FTA) country may still be cost-effective over a cheaper supplier in a high-tariff country once duties are included. • Moving final assembly to another country does not move Section 301 if the PCB stays sourced in China. • Understanding rules of origin, where tariffs apply, regional value content, and substantial transfor- mation also improves BOM engi- neering and helps you determine whether a product can qualify for a better rate. Because tariffs can change quickly, nimble teams will model scenarios: What if Section 301 increases? What if an exclusion expires? What if we move assembly to Vietnam or Mexico? This visibility turns the tariff stack into a dynamic decision variable. In short, we have an informational/analytical tool helping users answer: What tariffs apply to my prod- ucts, what is the real effective duty rate, how much exposure do I have, and what changes or mitigation options matter? You've worked with OEMs and EMS providers on sourcing and manufacturing decisions for years. What challenges were you hearing from these com- panies that prompted you to develop this approach? We took this on after talking with people at OEM and EMS companies who make landed-cost deci- sions, and hearing about their problems and the fixes they had already tried. Their issues kept resur- facing, and few could see the full effects of the vari- ables because the formulas were incomplete. I wanted a sourcing lead that opens a line already loaded, compares origins, and shows how the tariff is divided across the absorb, pass-through, and relocate strategies, so that the rest of the program management decision-making is based on those allocations. Those decisions are in NPI positioning and launch, a program transfer from OEM to EMS, or a move from one EMS factory to another. Each one is a geography choice, a cost choice, and a staffing choice. The OEM owns the import and the duty. The EMS quotes against the same tariff line, so both sides work from one number. The Modeler scores those three together: origins allocation, tariff impacts, and what these do to program cost, as well as the support headcount required to Mark Zetter FEATURE Q&A