Why Sourcing Comparison Matters in 2026
The China+1 Reality
Tariff risk has replaced labor cost as the #1 factor in sourcing decisions. The question isn't "is Vietnam cheaper than China?" — it's "does the duty savings from switching origins outweigh the higher unit cost and longer lead times?" This calculator answers that question with your numbers, not averages.
What This Tool Compares
- Duty rate: MFN rate for each origin, including Section 301 surcharges on Chinese goods and FTA preferences (KORUS, USMCA, ChAFTA, etc.) where applicable.
- VAT/GST: Destination-country import tax on the duty-paid CIF value — some destinations tax imports from all origins equally; others have origin-based exemptions.
- De minimis threshold: Whether your shipment value falls under the duty-free threshold for that corridor. Chinese goods face a collapsing de minimis in the US market.
- Shipping cost: You control this input — enter the actual freight quote for each origin. China→US ocean freight is typically $2,000-$4,000/container; Vietnam→US $3,000-$5,000; Mexico→US overland $1,500-$3,000.
- Total landed cost: CIF + duty + VAT — the number that actually matters for your P&L.
Common Scenarios
China → US vs. Vietnam → US (Apparel)
Chinese apparel faces 16.5% duty (MFN + Section 301). Vietnamese apparel at 14.5% MFN — only a 2-point difference. But Vietnam has no Section 301 risk, no AD/CVD on most categories, and expanding GSP-eligible product lines. The duty gap may narrow further if USTR grants new Vietnam trade preferences. The real calculus: Vietnamese factory prices are typically 8-15% higher than Chinese, but duty savings of 2% + elimination of Section 301 tail risk + shorter lead times vs. 2021 levels = net positive for many categories.
China → US vs. Korea → US (Electronics)
This one's not close. Chinese electronics face 2.5% MFN + Section 301 tail risk. Korean electronics under KORUS FTA: zero duty on virtually everything. If your Korean supplier's unit price is within 3-5% of your Chinese supplier's, you come out ahead on landed cost alone — before considering the Section 301 risk premium. For high-value electronics ($50K+ shipments), the duty savings alone can exceed $1,250 per container.
China → US vs. Mexico → US (Machinery / Auto Parts)
USMCA zero-duty beats Chinese 4.2% MFN + Section 301 stacking. But the real advantage is logistics: 3-5 day overland transit vs. 25-35 day ocean + 3-5 day rail from US West Coast. Inventory carrying cost savings often dwarf the duty savings. The catch: Mexican factories face their own input tariffs on Chinese components, and CBP is aggressively auditing nearshoring origin claims.
China → Germany vs. Any Alternative → Germany
EU TARIC MFN rates on Chinese goods are generally moderate (3-5%), but the EU is debating lowering the €150 de minimis to €50. For DTC e-commerce, this could add 19-22% VAT to shipments that currently slip through untaxed. Alternative origins (Turkey, Morocco, Eastern Europe) may benefit from EU FTA preferences or shorter supply chains — but at higher unit costs. This calculator lets you model the exact trade-off.
What This Tool Doesn't Model
- Anti-dumping / countervailing duties — product-specific and factory-specific. If your product has an AD/CVD order, layer those rates on top of the MFN rate manually.
- Lead time differences — Vietnam→US ocean is ~5-7 days longer than China→US. Mexico→US is 20-30 days faster than either. Inventory carrying cost is real but not modeled here.
- Quality differentials and defect rates — these vary by factory, not by country.
- Non-tariff barriers — forced labor compliance (UFLPA), FDA registration, CPSC testing requirements, and other agency holds that disproportionately affect certain origins.