{"id":12316,"date":"2024-12-05T08:00:29","date_gmt":"2024-12-05T16:00:29","guid":{"rendered":"https:\/\/www.qad.com\/blog\/?p=12316"},"modified":"2025-05-23T07:51:40","modified_gmt":"2025-05-23T14:51:40","slug":"6-actions-to-address-increasing-tariffs","status":"publish","type":"post","link":"https:\/\/www.qad.com\/blog\/2024\/12\/6-actions-to-address-increasing-tariffs","title":{"rendered":"6 Actions to Address Increasing Tariffs"},"content":{"rendered":"

[vc_row][vc_column][vc_single_image image=”12317″ img_size=”full”][vc_column_text]Following the recent U.S. presidential election, the incoming administration of President-elect Donald Trump signals the possibility of new import tariffs, particularly targeting goods from mainland <\/span>China<\/span><\/a> and potentially extending to other nations. This shift may prompt retaliatory actions from other countries, placing manufacturers in a position where they\u2019ll need to revisit strategies for managing tariff impacts.<\/span><\/p>\n

In the short term, companies typically focus on mitigating tariffs’ immediate financial effects. One option is to increase product prices to cover rising input costs. However, this approach isn\u2019t always feasible, especially in competitive markets, as it can erode your market share. Additionally, companies may face political and consumer backlash if price increases contribute to broader inflation.<\/span><\/p>\n

Negotiating with suppliers to offset tariff costs by securing lower prices on materials is another tactic. This can yield the best financial outcome, though renegotiating contracts and conducting competitive sourcing requires time and may sour long-term supplier relationships. Cost-saving measures across your supply chain and operational areas are also worth exploring. Alternatively, your company could absorb the tariff costs by reducing profit margins, though this is typically a last resort — and not very likely.<\/span><\/p>\n

6 Actions to Consider Now<\/span><\/h2>\n

Harvard Business School economist Willy Shih describes this as a setup for a “messy” scenario for both manufacturers and the broader economy. “People often don\u2019t realize how reliant the global economy is on intermediate goods and raw materials we tend to take for granted,” Shih noted. He emphasized that now is the time for companies to examine their supply chains closely, identify their tariff-related vulnerabilities, and establish actionable steps.<\/span><\/p>\n

With new and potentially extensive tariffs anticipated in early 2025, many companies have been preparing by evaluating various strategies. For instance, Stanley Black & Decker is exploring options to shift production and parts of its supply chain from China to other Asian countries or potentially to Mexico. Similarly, Apple, which relies heavily on production in China, is considering doubling its iPhone production in India\u2014from around $15 billion to $30 billion over the next two years.<\/span><\/p>\n

Following are six actions your organization should consider to address the upcoming tariff increases:<\/span><\/p>\n