DHL Shipping Pause and De Minimis Policy Shift

This article was originally featured on The Good Men Project. Written by Scott Douglas Jacobsen

How have DHL’s shipping pause and changes to the U.S. de minimis threshold impacted Hispanic-owned small businesses and cross-border trade with China?

Javier Palomarez, CEO of the United States Hispanic Business Council, discusses how DHL’s 2024 pause on sub-$800 de minimis shipments—combined with heightened U.S.–China trade tensions—has deeply impacted Hispanic-owned small businesses. These enterprises rely on affordable imports and grapple with rising costs, regulatory burdens, and uncertain supply chains. While entrepreneurs remain adaptable, the cumulative challenges of taxation, workforce shortages, and logistics delays threaten business continuity. Palomarez urges policymakers to offer tax relief, reduce regulatory pressure, and support nearshoring strategies to sustain America’s fastest-growing business sector—Hispanic-owned firms contributing over $850 billion to the economy.

Scott Douglas Jacobsen: So today we’re with Javier Palomarez, the Founder and CEO of the United States Hispanic Business Council (USHBC). He is a leading national advocate for Hispanic-owned small businesses, with over thirty years of experience in multicultural marketing and sales, including work with several Fortune 100 companies. Palomarez is a recognized voice on issues of immigration, the economy, and minority representation. He frequently appears on national television for his insights on public policy, the challenges facing small businesses, and the influence of Hispanic voters in key swing states. Based in Flower Mound, Texas, he continues to advocate for legislative and economic initiatives supporting Hispanic entrepreneurs nationwide. So, how did—and how does—DHL’s pause on shipments affect cross-border e-commerce volumes into the U.S.?

Javier Palomarez: If we take a step back, the de minimis provision under Section 321 of the U.S. Tariff Act allows shipments valued at $800 or less to enter the United States without duties, taxes, or formal customs procedures. This facilitates cross-border e-commerce, especially for small packages. In recent years, de minimis shipments have surged, accounting for a significant share, over 90%, of all informal entries, with a large portion originating from China. This provision has played a vital role in helping small businesses import goods at lower costs and with fewer regulatory barriers. However, amid rising concerns about evasion of duties, product safety, and the trade imbalance with China, scrutiny of de minimis has increased. When DHL Express paused its de minimis shipments under $800 into the U.S. in early 2024, it disrupted the logistics pipeline for many small businesses that rely on affordable, fast international shipping. This action came in response to regulatory pressure and ongoing U.S.–China trade tensions, including additional Section 301 tariffs imposed on certain Chinese imports. The result? Small businesses, many of which are owned by Hispanic entrepreneurs, have found themselves unable to source products from overseas, particularly from Chinese suppliers, affordably. The burden of complying with new customs regulations or paying duties often erases their profit margin. DHL has had to adapt by shifting its logistics strategy, and in some areas, has reportedly scaled back operations, resulting in job losses and facility closures, including in California, though exact numbers vary by source. The broader ripple effect has been significant for the small business community, which heavily depends on reliable and economical global shipping.

Jacobsen: So, does this directly result from changing the de minimis policy in the context of the broader U.S.–China trade relationship?

Palomarez: Yes. While the U.S. must take a firm and fair approach in trade negotiations with China, our most significant source of de minimis imports, unintended consequences exist. One is the disproportionate impact on millions of small businesses, including Hispanic-owned enterprises, that are suddenly dealing with increased costs and regulatory complexity.

Jacobsen: What are you hearing from Hispanic-owned small businesses about their challenges?

Palomarez: The challenges vary depending on region, industry, and generational status. Some Hispanic entrepreneurs are first-generation immigrants with strong ties to family-run operations or specific trades. Others are multi-generational business owners who have scaled up within construction, logistics, retail, and food services sectors. For example, someone from a family of farmers may continue in agriculture, just as someone with experience in trade may move into import/export or e-commerce. These businesses often lack the financial cushion or legal resources to navigate abrupt changes in trade policy. That makes them especially vulnerable to regulatory shifts, like those affecting de minimis. At the same time, many Hispanic business owners are resilient and innovative, often leveraging bilingual and bicultural capabilities to reach underserved markets. But they need predictable rules, access to capital, and fair trade frameworks to thrive.

Jacobsen: And what is the average character of those businesses? Can you specify what types of challenges—whether in product, services, or otherwise—are impacted by these DHL-related issues?

Palomarez: Yes. Here is a little context on the Hispanic business community in the United States. At the United States Hispanic Business Council, we’re proud to advocate for the 4.5 million Hispanic-owned firms in this country that collectively contribute over $850 billion to the American economy. It is also the fastest-growing segment of the American small business community. For every one venture started by a non-Hispanic, Hispanics are beginning three. So we’re launching businesses at a rate of three to one compared to the general market. That’s important in the U.S., Scott, because when you look at it, small businesses are responsible for creating nearly 70% of net new jobs. We’re the beating heart of the American economy. When considering the challenges facing all American small businesses, and certainly Hispanic-owned ones, eliminating de minimis has added yet another obstacle.

The change to de minimis and ongoing supply chain disruptions will overburden already struggling ports on both coasts. That will send ripples throughout the business community. Local restaurants—mom-and-pop-owned establishments—depend on imported ingredients for their menus. Local mechanics rely on imported parts. Local bodegas rely on imported goods. And the list goes on. Unlike large corporations like Walmart or Costco, the average small business has no resources to pre-purchase inventory. We do not have the negotiating power big firms have to bring prices down. We are stuck with what we can get—if we can get any inventory at all, Scott. We do not have the resources. And when we look domestically, we cannot find producers for many of the parts, ingredients, and goods I mentioned. So we are stuck. It is a scary situation for the American small business community. In my community, specifically—the Hispanic-owned small business community—the vast majority of our members voted for President Trump. So, as you can imagine, there is some trepidation. There is a bit of questioning—maybe even buyer’s remorse. And we are trying to figure out how we can adapt. How do we continue to maintain our businesses, let alone grow them? It is a difficult time. De minimis has not helped. Corporations have flexibility in some ways but also rigidity in others. They have flexibility because they generate a lot of capital to test new ventures at scale. I remember Jeff Bezos recently talking about how, with this horizontal optimization layer—AI—they can apply it across more than a thousand applications at once in development. However, they are also large entities, and profound structural shifts are difficult for them. If you build a massive factory, you are locked into that investment. On the other hand, small businesses may not generate the same amount of capital, but they are not as deeply entrenched, so they have some flexibility.

Jacobsen: Is there—or is there not—some benefit? Is there a greater possibility of maneuvering through some of these customer changes for small businesses that are encountering more challenges?

Palomarez: Adaptability and creativity—the coin of the realm for the American small business community. To be an entrepreneur, in and of itself, illustrates that you’re willing to take a chance. You’re eager to be creative. You’re keen to do whatever it takes to get it done. Otherwise, you wouldn’t be an entrepreneur. So we will manage that. We will handle it. I’m sure we will.

However, the real issue is the accumulation of challenges. If it’s not a regulatory challenge, it’s taxation. If it’s not taxation, it’s policy and legislation. If it’s not that, it’s supply chain issues. If it’s not that, we’re unable to fully staff our companies because of workforce shortages in areas like construction, manufacturing, agriculture, hospitality, and even technology. So it’s the cumulative effect that is making it difficult for the American small business community. Look, all we want—all any business in America wants, and indeed the small business community—is to know and believe that there’s an administration that understands our challenges and is willing to offer some relief wherever and however they can. We want a stable environment to plan, invest, and grow our businesses. And we don’t have that right now. Like every American, we try to do our part and patiently await the outcome. But it is a difficult time. Again, many small businesses don’t have the resources to wait six months or a year for things to stabilize. Many of us will be out of business if this continues.

Jacobsen: What about the impacts on delivery time and processing time? That’s another issue.

Palomarez: Yes, I should throw in this one. The average customer may not necessarily understand small business owners’ challenges.

Jacobsen: What about customer satisfaction?

Palomarez: Yes, one of the hallmarks of the American small business community is our ability to offer absolute customer satisfaction. We know our clients. We’re in the neighbourhood. We’re local retailers. We shop at the same stores. We gas up our cars at the same stations. We go to the same churches. We belong to the same golf clubs, etc. So we’re in those communities, and a lot of that personalization- the customized customer relationships is put at risk when the retailer or business owner has no control over whether they will get a product, much less on time. When you’ve built your reputation and your business on customer satisfaction—on that local touch and feel people have come to rely on—it puts a significant part of your business strategy at risk. We’re seeing that right now, where we can’t even tell our clients with certainty, “Yes, this item will be here in two weeks.” 

We’re hoping it’ll be here in two weeks, but we know, in the back of our minds, it’s probably not going to be two weeks, and it may not arrive at all. So you’re risking your entire business’s reputation in an environment like this. What’s tricky is that it’s entirely beyond our control. That’s the most disheartening part of all this. It’s not our fault.

Jacobsen: So, local and nearshore supply chains—how are small businesses acutely affected in those markets? Are they still relying heavily on shipping?

Palomarez: Yes. We’re delighted to hear about nearshoring and the prospect of bringing manufacturing, if not home, then at least closer to home. The reality is, we’ve grown dependent on China. Everybody in our small business community that we poll is acutely aware of our dependence on China. And it’s a dependency built up over decades. This didn’t happen overnight. While we agree with President Trump and this administration that we need to wean ourselves off of China, it would be great to create those manufacturing jobs, facilities, and business opportunities here in the United States; it’s not as easy as all that. So while we support the rationale, we support the administration’s efforts to nearshore or bring manufacturing back to the United States, we live in the sure knowledge that there’s a huge gap between policy—or a campaign promise—and the reality of getting those plants up and running and producing the goods and products we need. 

There’s a time lapse, and it’s in that time lapse that we could either be severely damaged or go out of business entirely. So we’re looking for an administration that understands that—and is willing to help us during that interim period to keep our businesses alive, well, and growing. That remains to be seen, but we’re hopeful. When we poll our membership, the sentiment is still that Donald Trump is enough of a businessman to recognize this, and they’re hoping there will be some relief in terms of exclusions, or tax incentives, or other support to help the small business community weather the storm between the decision-making phase and the actual implementation of domestic or nearshore manufacturing.

Jacobsen: What moves by the current administration—for those who voted for it—would relieve some of their buyer’s remorse, to use the phrase you mentioned earlier?

Palomarez: That’s a big question. We did two polls—one, maybe two months before the election, and one, maybe two weeks before the election. In both cases, we surveyed 2,527 members. And in both instances, some 86% of our membership said they identified with Kamala Harris. They identified with her on a personal level—as the child of immigrant parents, a child raised in a single-parent household, a young person who had to struggle to get where she is, a minority, and a woman. So about 86% of our membership identified with her. They did not identify with Donald Trump. They weren’t the children of billionaires.

They didn’t inherit the wealth that Donald Trump inherited. So while they identified with Kamala Harris, they still said they would vote for Donald Trump because they believed that Trump was enough of a businessperson that he would help with the economic challenges the country was facing, and ultimately, that would help their small businesses, if that makes sense to you. So with that in mind, it runs the gamut. There are so many areas where we need help. The last person to enact any legislation that helped the American small business community in terms of taxes and taxation was, in fact, Donald Trump. 

It was controversial, but the small business community benefited from the tax legislation Trump passed during his first term. And if you think about it, Scott, it hadn’t been since Ronald Reagan, since back in the eighties, that American small businesses received any relief on their taxes. When you’re running a business and 47% of your income goes directly to Uncle Sam before you even see a penny, you begin to appreciate a guy who sees it from your perspective. Controversial or not, you start to believe in him if he helps you with that particular issue. And so, that’s the Donald Trump that this community voted for.

In response to your question, are there other areas in which Donald Trump or this administration could help the American small business community? Unequivocally, yes. Taxation is one. Lessening regulation is another. The regulatory challenges the average business faces in America, never mind small companies, are insurmountable. Unlike large companies, we don’t have a division of tax experts. We don’t have an army of lobbyists. We don’t have a department of lawyers. It’s just us. We have to manage it. We have to handle it all. So you can imagine how overwhelming the regulatory structure is in this country. An administration that helps us with regulations? Fantastic. 

So yes, there are several areas where this administration could still become the saviour of the American small business community. Energy costs are another example. Again, that’s entirely out of our control. We’re running the same business we were three years ago, but it’s costing us 42% more—simply because insurance has gone up, energy costs have gone up, taxes have gone up, etc. It’s hard to keep your business, much less grow it, in an environment like that. So there are many areas where this administration could help the American small business community, and we live in that hope. We’re hopeful that this administration will be the one.

Jacobsen: Excellent. Javier, thank you so much for your time today. I appreciate your expertise. 

Palomarez: Have a good one.  Thanks so much.

Jacobsen: Hey. You take care.

Palomarez: Bye-bye.