Tariffs and Global Trade Wars Impact on Supply Chain

How supply chains can prepare for tariffs and global trade wars

Shield your global supply chain network from changes to U.S. trade policy

CSCOs around the world must determine how to respond to potential shifts in U.S. trade policy. Given all of the unknowns facing the industry, supply chain leaders should create scenarios that can be modified as the underlying assumptions evolve and change. This research helps CSCOs, responsible for network strategy for the Americas, to evaluate contingency scenarios while continuing with business as usual.

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    The role of supply chain leaders during this period is to become trusted advisors to the rest of the organization and lead with business continuity plans for short-term, midterm and long-term horizons.

    Kamala Raman

    Senior Director Analyst, Gartner Research & Advisory

    Supply chains face shifts in trade policies

    As new tariffs and retaliatory tariffs grow between the U.S. and its global trading partners, uncertainty around the tariff impact on supply chain networks intensifies, along with the risk of significant impacts on supply chain costs. If risk mitigations from trade policy changes are done as ad hoc endeavors, they can emphasize organizational biases and impact long-term decision making.

    Global tensions heighten: The U.S increased tariffs from 10% to 25% on $200 billion in imports from China. In response, China increased tariffs on U.S agricultural imports from 5% to 25%.
    How to navigate tariff uncertainties. Event: Tariff uncertainty looms between US and China. Impact: Supply chains must reconsider existing sourcing, manufacturing, and distribution networks. Recommendations: Prepare by using scenario planning in sourcing, manufacturing and product flow; be flexible by having options for suppliers, contract manufacturers and manufacturing locations; and create digital models to test for impact on network cost and service levels.

    Preparing your supply chain for new trade policies

    While companies routinely seek to make their supply chains more competitive, very few have considered vulnerability to trade risks. The current uncertainties around tariffs offer companies that run highly agile supply chains a chance to gain a competitive advantage in the drastically changing global trade landscape. 

    How to navigate tariff uncertainties. Event: Tariff uncertainty looms between US and China. Impact: Supply chains must reconsider existing sourcing, manufacturing, and distribution networks. Recommendations: Prepare by using scenario planning in sourcing, manufacturing and product flow; be flexible by having options for suppliers, contract manufacturers and manufacturing locations; and create digital models to test for impact on network cost and service levels.

    Insights you can use

    Gartner’s insights identify some of the risk management tools that supply chain leaders can use during this period of uncertainty.

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    Gartner topic experts

    Gartner’s supply chain experts include more than 100 people worldwide. Meet a few of our leaders.

    Kamala Raman
    Senior Director Analyst,
    Research & Advisory

    Greg Aimi
    VP, Team Manager,
    Research & Advisory

    Mark Atwood
    Managing VP,
    Research & Advisory

    Simon Bailey
    Senior Director Analyst,
    Research & Advisory 

    Miguel Cossio
    Senior Principal Analyst
    Research & Advisory

    Paul Lord
    Senior Director Analyst
    Research & Advisory

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