A tariff is a tax a government charges on goods as they cross a border, most often on imports. It is usually calculated as a percentage of the shipment’s declared value (an ad valorem tariff) or as a fixed amount per unit or per weight (a specific tariff). Because the tariff is paid when goods enter the destination country, it raises the total landed cost of imported products and can change the price you quote to an international buyer.
How it works
Tariffs are tied to how a product is classified, usually under an HS (Harmonized System) code, and to its country of origin. Customs authorities apply the rate for that code to the customs value of the shipment. Trade agreements, quotas, and anti-dumping duties can raise or lower the effective rate. Whether the buyer or seller pays at the border depends on the agreed Incoterms (for example DDP, where the seller covers duties, versus DAP, where the buyer does).
Why it matters for quoting
For a domestic sale, a tariff rarely enters the picture. For cross-border B2B orders it can move the true cost by a meaningful margin, so a quote that ignores it can quietly erase your profit or surprise the buyer at delivery. Deciding upfront who absorbs the tariff, and reflecting that in the line items, keeps a quote accurate and defensible.
Example
You quote a wholesale order of machined parts to a buyer in another country. The parts carry a 6 percent import tariff on a customs value of 10,000, adding 600 in duty. If you sell DDP, you build that 600 into the quoted total; if DAP, you note that duties are the buyer’s responsibility so there is no dispute later.
When you build these orders in Shopify, you can add tariff or duty handling as a separate line or adjust unit pricing before the buyer accepts and pays. See the B2B quoting glossary for related terms like landed cost and Incoterms.