A Supply Chain Playbook for Tariff Response

From stockpiling to reshoring, U.S. manufacturers are rethinking operations as new tariffs take hold. But while a wait-and-see approach might seem tempting, they need to be actively assessing their options and preparing to implement changes decisively.

There are a number of steps that can be taken to mitigate supply chain risk and increase resilience — if you start now. Following are some recommendations for action.

Diversify your vendor list. Reliance on a small group of vendors is always risky. You’re more vulnerable to disruption from things like natural disasters, geopolitical issues and regional economic instability. Working with multiple vendors will also help you negotiate better pricing terms and provide more options to scale production up or down based on market demand. Validate which tariffs impact which region. It’s worth looking outside those areas for possible new partners. Increasing U.S. production is ideal, of course, but it might not always be possible.

Formalize pricing agreements. Successful B2B companies are built on strong partnerships. Strategic pricing agreements are the foundation of these relationships because they bring predictability and stability. They help build trust, reduce the need for ongoing negotiation, and make purchasing experiences smoother and more efficient. Review existing agreements and talk with your strategic suppliers about sharing some of the tariff pain to avoid passing the entire cost increase on to your customers. A drop in end-user purchases will negatively impact everyone. 

Implement transparent price adjustments. The COVID-19 pandemic taught us that companies have the power to push prices up due to rising costs from supply chain disruption and heightened demand beyond general inflation. Pricing conditions have since normalized, but tariffs are changing the equation again. Decisive actions with a strategic approach will help protect margins and profitability. 

Know your tariff exposure. Not all tariffs will impact companies the same way. Some will see direct