How to Protect Your Supply Chain from Tariffs

Oct 10, 2019Supply Chain Management

It is no secret that the trade war with China and increasing tariffs have been a significant topic of conversation recently. We are in a state where we simply cannot predict tariff fluctuations.

Because we have no way to know the extent of tariffs in the future or how high they could rise, the best way to protect your business is to plan in advance. Our team has put together a list of a few things you can do to be proactive in preparing for changing trade policies.

Utilize a Logistics Partner

The first way to help protect yourself from rising tariffs is to create a partnership with a logistics partner. We can provide the warehousing and connections to help you start saving now.

Tariffs have already risen, but there is still risk of them going even higher. Procure more stock now so that you have the supply when prices increase. If you don’t have the space to store extra inventory, talk to us. We have warehousing space and the distribution channels to help you get what you need.

Long-Term Contracts with Suppliers

Now is the time to reevaluate and renegotiate your current supplier contracts. Attempt to lock them into long-term fixed cost contracts to protect yourself.

However, this isn’t always an easy negotiation. Many suppliers are using the current tariffs as an opportunity to increase prices. That’s why it’s critical to negotiate a fixed cost or a protection clause into your agreements to protect you against significant rate hikes.

Reevaluate Your Pricing Strategies

This always includes short- and long-term investment strategies in maintaining current customers and earning new ones. Adopting an across-the-board price increase without evaluating each client’s value to your organization, individually, creates an atmosphere for a slippery slope of business and revenue loss.

Revisit Efficiency

The current economic trade war also opens opportunity for you to take the time to reevaluate some of your processes. Are there areas of your business that could be running more efficiently? Is your business taking extra steps that could be accomplished earlier in the manufacturing process?

Do not confuse efficiency with taking shortcuts. Avoid attempting to cut out steps in the process. Although it may seem like this would save money, you could potentially create safe-ty or health concerns. A recall or health issue in relation to your product could produce far more damaging consequences than tariffs.

The team at TOC Logistics focuses on getting to know our clients and the unique obstacles they face. This allows us to provide the most equitable solutions to their supply chain needs.

We want to make sure you are prepared to mitigate the potential risks tariffs could put on your supply chain. Are you interested in learning more? Reach out to a team member today.


Our capable and experienced team is standing by to assist organizations and supply chains across the globe. Click the button to get in touch with our team.

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