The Big Picture: Trade Rules Are Moving Faster Than Your Price Book

Global trade policy is a moving target. Overnight, duties, surcharges, and shipping premiums can spike—often without warning—and every one of those adjustments lands squarely on your balance sheet. Think of it as a “silent tax”: it chips away at gross margin long before a unit ever hits the showroom or a part makes it to the counter.

For multi-location dealers selling everything from powersports and trailers to marine, RV, and agriculture equipment, that silent tax poses the same fundamental question:

Can you see the true cost—and profit—of every unit and part in real time?

If the answer is “no” or “I’m not sure”, keep reading.

What Is Landed Cost and Why Does It Matter?

Most Dealership Management System (DMS) price books start with the invoice cost. But invoice cost is only one layer in a five-layer cost structure:

1. Invoice / FOB price
2. Freight & insurance
3. Tariffs, duties & surcharges
4. Brokerage/clearance fees
5. Currency variance

Miss, mis-code, or delay any piece of that cake and margins skew—pricing decisions lose their footing.

How Do Tariff Changes Show Up on the Dealership Floor?

• Cashflow compression: Higher landed values tie up capital longer; aging gets riskier.
• Service & parts squeeze: Cost creep on components erodes RO profitability unless pricing updates stay in lockstep.
• Pricing paralysis: Teams hesitate to reprice, fearing customer pushback or mismatched online listings.
• Inventory lag: Slow movers absorb the shocks; fast movers starve if reorder logic ignores new costs.

Market analysts caution that policy uncertainty prolongs recovery in discretionary categories—so “wait it out” isn’t a strategy. You need systems that adapt.

A practical playbook

Tech-upgrade first, tools second.

You don’t need a miracle; you need better plumbing. Here’s the operating cadence top dealers are adopting—software-agnostic, but far easier with a modern DMS like Blackpurl in the mix:

1. Capture every cost at receipt
   Record freight, brokerage, and surcharges against the shipment/container—not just the unit—so Cost of Goods Sold (COGS) reflects reality from day one. (When your platform makes this native, pricing conversations get a lot calmer.)
2. Make margin visible—everywhere
   Standardize margin views for sales, parts, and service. When managers see the same truth, repricing and discount discipline stop being debates and start being workflows. Trade outlets and OEM watchers agree: transparency beats turbulence.
3. Model “what-ifs” before you buy
   Run scenarios on inbound POs (different vendors, shipping modes, lead times). If the landed math breaks target margin, adjust terms or quantities before the shipment exists.
4. Reprice with intent, not panic
   Batch updates by category or aging bracket; sync to website and marketplace feeds in one pass. Consumer-facing comms can stay positive (finance options, value adds) while you keep the business math honest. 
5. Point inventory toward velocity
   Let reorder points react to the current turn, not last quarter’s guesses. If cost volatility rises, shorten buy cycles and tighten min/max bands.

Markup vs. Margin: Why Understanding the Difference Protects Your Business

This section features insights from our NATDA Trailer Show 2025 panel: “Manage By The Numbers”

Here’s the critical mistake many dealers make: raising markup doesn’t guarantee protecting margin.

The Math:

• Markup = How much you add to cost
• Margin = What percentage you keep after the sale

Speaking “margin” language across your team is critical. Once sales, parts, and service all understand margin vs. markup, everything else lines up:

• Stocking decisions based on margin potential
• Quoting discipline that protects profitability
• Service menu pricing that reflects true parts costs

During our recent panel at NATDA, we unpacked practical ways to:

• Align margin targets across sales, parts, and service
• Avoid “accidental discounting” caused by stale cost data
• Communicate pricing changes to customers without eroding trust
• Use margin waterfalls to identify where profit leaks

Download the complete margin protection worksheet here

Checklist: Is Your Dealership’s Margin at Risk?

1. Do you see the landed cost before the item is received into inventory?
2. Can you model cost changes on a future PO without touching live data?
3. How quickly can all departments update prices after a duty shift?
4. Is your reorder logic based on turn rate or gut feel?
5. Can every manager identify margin leakage in real time?

Score 4–5 “yes” answers? You’re ahead of the curve.
Anything less? It’s time for a tech upgrade.