**Global:** A Gartner survey reveals 45% of supply chain leaders plan to pass tariff-related costs onto customers, while 43% adopt multiple initiatives like renegotiation and relocation to mitigate financial impacts and tackle slowing demand amid evolving trade risks.
A recent survey conducted by Gartner, Inc. has revealed that nearly 45% of supply chain leaders plan to pass increased costs associated with new tariffs onto their customers. This represents a significant response to the evolving landscape of tariffs, which are influencing business strategies across various sectors. The findings indicate a dual approach to cost mitigation, with 43% of respondents outlining that they would seek to alleviate the financial burdens through multiple supply chain initiatives.
Vicky Forman, a senior director analyst in Gartner’s Supply Chain practice, noted, “Supply chain leaders have many potential levers to pull from in mitigating new costs related to tariffs. While supply chain leaders have multiple initiatives underway to potentially lessen the impacts, many of these actions have yet to be completed.” This statement underscores the proactive measures being considered by supply chain professionals, even as they grapple with uncertainty.
The survey highlights that among the risks identified, “increased costs” emerged as the most significant concern for 92% of respondents. Additionally, 75% expressed worries about slowing customer demand, categorising it as one of their top three risks. A decrease in consumer demand was specifically mentioned by 49% of those surveyed, while 45% highlighted concerns regarding retaliatory measures that could impact international customer demand.
To address these challenges, supply chain leaders are implementing various initiatives aimed at mitigating the effects of tariffs. The most frequently cited strategies include:
- Renegotiating supplier contracts, noted by 47% of respondents.
- Exploring collaboration opportunities with suppliers, mentioned by 43%.
- Addressing country of origin and valuation issues as part of trade management tactics, highlighted by 40%.
- Adjusting supply locations outside of the United States, as cited by 39%.
- Modifying production locations beyond U.S. borders, mentioned by 26%.
- Pulling inventory forward, referenced by 23%.
These strategies reflect a concerted effort from supply chain leaders to navigate the complexities imposed by new tariffs while striving to maintain operational efficiency and customer satisfaction. The findings, reported by Supply & Demand Chain Executive, offer insight into the current climate of supply chain management, as organisations adapt to the challenges and opportunities presented by changing trade regulations.
Source: Noah Wire Services
Subscribe to Industry Updates
