As someone who has been in customs and supply chain for over 20 years and now the CEO of a company, one of the most surprising - and frustrating - truths I see across businesses is this: millions in refundable duties are left unclaimed every year.

Why?

Because companies often treat customs duties as a sunk cost - not realizing that, in many cases, there’s money sitting quietly, not to mention legally, within their supply chain, waiting to be recovered.

Whether you’re a global eCommerce brand, a manufacturer, or a distributor, chances are you’ve overpaid duties at some point - or you’re eligible for a duty drawback and don’t know it.

Let’s break it down and look how experts like Trade Duty Refund can help.

What Is Duty Drawback?

Duty drawback is a government program, available in the U.S. and several other major trade countries, that allows businesses to recover customs duties paid on imported goods that are later exported, destroyed, or used in the production of exported goods.

In other words: if you import raw materials or finished products and then re-export them (even as part of another product), you may be eligible to claim back a significant portion - sometimes up to 99% - of the duties paid.

Yet many companies either:

• Don’t know they’re eligible
• Don’t have the internal systems to track eligible items
• Find the process too complex to prioritize

And that’s money left on the table.

What Is Duty Drawback?

Duty drawback is a U.S. government program (and available in other countries too) that allows businesses to recover customs duties paid on imported goods that are later exported, destroyed, or used in the production of exported goods.

In other words: if you import raw materials or finished products and then re-export them (even as part of another product), you may be eligible to claim back a significant portion - sometimes up to 99% - of the duties paid. Over $2 billion USD is refunded annually in duty drawback in the U.S. alone.

Yet many companies either:

• Don’t know they’re eligible
• Don’t have the internal systems to track eligible items
• Find the process too complex to prioritize

And that’s money left on the table.

Common Overpayment Scenarios

Apart from duty drawback, customs overpayment is another source of financial blunders. Here’s where I often see it:

• Incorrect tariff classification - assigning a product to a higher-duty code than necessary
• Overstated customs value - including costs that shouldn’t be dutiable
• Not applying trade agreements - such as USMCA, EU FTAs, or GSP preferences
• Missing documentation for exemptions or special programs

In high-volume operations, even a small error rate, like €0.50 / $0.50 per unit, can add up to tens of thousands in unrecoverable costs.

Let’s talk numbers

It’s not uncommon for businesses to recover 6-7 figures annually once a formal drawback or refund review process is in place. According to Big 4 consulting data reports, a single customs audit might reveal:

• €150,000 in misclassified goods
• €80,000 in unclaimed drawback from re-exports
• €200,000 in overstated declared value

And these are often retroactive as claims can sometimes go back up to 5 years, depending on jurisdiction.

What You Can Do

1. Review Your Import Data: Start by looking at your top imported SKUs. Are any re-exported or used in export products?
2. Map Trade Flows to Drawback Potential: Partner with a customs consultant to track what qualifies.
3. Run a Refund & Overpayment Audit: Even a limited scope review can uncover immediate savings, get an expert consultant to do the dirty work.
4. Automate Where You Can: Duty management software can help track eligible transactions and streamline claims.
5. File Timely: Most countries have strict windows for filing drawback claims. Don’t leave it until it’s too late.

Trade Duty Refund is here to help

Customs duties are often viewed as a fixed cost, but in reality they’re not. If you’re not actively reviewing your duty spend and eligibility for drawback, you’re likely leaving money in your supply chain. As someone who’s worked across dozens of industries and trade flows, I can confidently say: if you’re shipping across borders, there’s value to be found. You just need to know where to look.

Trade Duty Refund helps companies with duty drawback programs as well as ongoing customs consultancy so companies ensure that products are classified correctly and import/export in time.

If you’re ready to discover how to optimize costs - let’s talk.