London: New tariffs are forcing companies to urgently rethink procurement strategies, yet nearshoring efforts often falter due to lack of actionable supplier intelligence. Industry leaders stress the shift to data-driven, real-time insights as essential to overcoming supply chain disruptions in 2025.
New tariffs and economic pressures are driving urgent shifts in procurement strategies across industries, pushing companies to rethink their supply chains to avoid escalating costs and supply disruptions. Gartner recently highlighted that nearly three-quarters of supply chain leaders anticipate tariff changes will significantly reshape their strategies in 2025. While nearshoring—the practice of relocating suppliers closer to home—has emerged as a favoured response, its promise often remains more aspirational than practical.
The appeal of nearshoring is clear: reduced risk, faster delivery, and greater control in uncertain geopolitical and economic times. But many organisations falter because they mistake nearshoring as an end goal rather than a complex outcome of a well-informed, strategic process. Instead of clarity, procurement teams frequently face a void of usable intelligence—lacking data to identify, assess, and vet alternative suppliers, particularly beyond their immediate Tier 1 networks. This intelligence gap stalls nearshoring initiatives and hampers the ability to respond to tariffs proactively.
Indeed, less than half of procurement leaders currently have defined responses to tariff shifts, often leading to reactive and disjointed efforts. Traditional sourcing approaches, built on legacy relationships and limited regional familiarity, no longer suffice in a climate where supply chain agility and resilience demand precision and real-time data. A growing body of evidence underscores that visibility—not geography—is the critical determinant of supply chain resilience.
Data from a supplier intelligence provider reveals striking untapped domestic capacity across key sectors affected by tariffs. The automotive supply chain, a bellwether for tariff impact, faces new levies on components from Canada and Mexico. Yet, over 66,000 U.S.-based machine shops and 40,000 transmission suppliers exist domestically—capacity that remains largely invisible to procurement teams. Similarly, the electronics sector boasts more than 100,000 component providers and over 114,000 semiconductor suppliers in North America. Agriculture and manufacturing likewise have substantial supplier pools locally, but 36% of procurement teams still rely on rudimentary internet searches to identify suppliers, a method compared to navigating a storm with a paper map.
Compounding the challenge, the urgency to shift sourcing is mounting rapidly. Businesses such as Steve Madden and Rivian are actively reducing reliance on China and renegotiating supply contracts in anticipation of new tariff regimes under the current U.S. administration, while navigating the complexities of disentangling from long-established, capital-intensive supply chains in China and Mexico. This transition is not simple or fast-paced for many, inflating the risks of delays and revenue loss without robust supplier intelligence.
Modern procurement resilience hinges on sophisticated intelligence frameworks that go well beyond geographic re-mapping. Leading companies now harness real-time, AI-driven tools to track tariff exposure, model sourcing scenarios, and benchmark supplier performance dynamically. These technologies enable procurement teams to pose precise questions and receive immediate, actionable insights—transforming decision-making from guesswork into data-driven agility. Tools from technology providers are designed to automate sourcing events, optimize supplier selection based on shifting tariffs, and generate comprehensive reports to support alternative sourcing or shipment rerouting.
Beyond technology, strategic procurement requires holistic approaches. Proactive cost management, supplier spend categorisation, and supplier mapping to uncover vulnerabilities are critical. Cross-functional collaboration across procurement, finance, and operations departments enables scenario planning that prepares organisations for best to worst-case tariff impacts. Embedding tariff protections into supplier contracts and extending cost models to incorporate trade barriers further shields margins and builds resilience.
The idea that nearshoring is a slow, long-term project must be reconsidered. Economic headwinds and shrinking profit margins compel swift action. Retailers balancing tariffs on electronics, apparel, and food cannot afford prolonged adjustment periods without losing market share. An “always-on” procurement approach—continuously monitoring and refreshing supplier data and relationships—ensures organisations are ready to pivot immediately as conditions change.
This evolving paradigm marks a fundamental mindset shift: resilience is now about having the right suppliers, not just more suppliers or closer suppliers. Small and local suppliers, often overlooked, are increasingly recognised for their agility, transparency, and cost advantages, with 21% of companies actively escalating spend with these partners.
In conclusion, nearshoring success is predicated on supplier intelligence as the new baseline for supply chain resilience. Companies that integrate comprehensive, real-time intelligence into their procurement strategies will outpace competitors still relying on assumptions or incomplete data. The future belongs not to those who merely mandate nearshoring, but to those who build supply chains grounded in clarity, precision, and actionable insight.
Source: Noah Wire Services
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