Tariffs Are Here: Reasons to Optimize and Update Your Canadian Service Approach
Proposed U.S. tariffs on Chinese, Canadian, and Mexican goods add hidden costs to cross-border service. Why keeping repair in Canada protects your margins.
Update, March 2025: the proposed tariffs described below have since taken effect. For the current rates and the per-unit math, see The Impact of Trump’s 2025 Tariffs on Reverse Logistics in Canada.
The incoming Trump administration has proposed tariffs that create real problems for electronics manufacturers relying on cross-border service operations: an additional 10% on Chinese goods (compounding existing levies of 15% or more) and a flat 25% rate on Canadian and Mexican imports. If your Canadian service model routes product through the U.S., these numbers land directly on your cost of service.
The hidden costs of cross-border operations
Two scenarios illustrate where the money leaks:
Scenario 1: Direct imports from China to the U.S. With the new levy stacked on existing tariffs, Chinese-made goods entering the U.S. face compounded duties exceeding 25%, a cost baked into every unit before it’s ever sold or serviced.
Scenario 2: Importing into Canada, repairing in the U.S. This is the trap many OEMs don’t see coming. Product imported into Canada that gets shipped south for repair incurs dual tariff penalties: the initial import taxes plus the return logistics costs. Every RMA becomes a tariff event.
Why Canadian operations win
Keeping service work inside Canada delivers three advantages:
- No tariff penalties. Units that stay in-country never trigger cross-border duties.
- Lower operating costs. Canadian labor and logistics costs run below U.S. equivalents.
- Faster service. No customs bottlenecks means shorter turnaround times. Repairs move on your schedule, not the border’s.
The cost of standing still
Sticking with a cross-border service model under the new tariff regime means:
- Margin erosion: tariff costs compound on every serviced unit
- Operational inefficiency: customs adds delay and unpredictability to every repair cycle
- Reputational damage: slower turnaround times reach your customers before your cost problems reach your P&L
Optimize now, not after the costs hit
Microland has over 30 years of experience as Canada’s leading electronics repair and refurbishment partner. We run repair and warranty programs, reverse logistics, and refurbishment entirely within Canada, which means your service operation sidesteps the tariff problem instead of absorbing it.
If tariffs are about to reprice your service model, talk to us about moving it inside the border.