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Impending tariffs on imports from the US have thus far been seen as a threat, an additional cost to pass on, or to be avoided by front-loading cargo.

But with a slight gestalt flip, shippers should in fact see tariffs as an opportunity to develop a strategic response, not simply as a cost problem. What’s more, according to Gartner, they should be viewed as a developing event.

“Enterprises should recognise tariff volatility as a multi-year, dynamic event,” said Suzie Petrusic, senior director analyst in Gartner’s Supply Chain practice. “Chief supply chain officers (CSCOs) who recognise this reality should continually evaluate opportunities to invest in strengthening their operations and attract outside investments from geopolitical actors and ecosystem partners.”

Counter measures are better than acting too early or too late, noted Gartner, and businesses must be prepared to be agile.

“CSCOs who anticipate that tariff volatility will persist for years, rather than months, should also recognise that their business operations will not emerge successful by remaining static, or purely on the defensive,” said Brian Whitlock, senior research director.

“The long-term winners will reinvent or reinvigorate their business strategies, developing new capabilities that drive competitive advantage.

“In almost all cases, this will require material business investment and should be a focal point of current scenario planning.”

Gartner explained that there were five possible pathways for companies to choose from.

The first – product retirement – should be considered for those sectors that will be unable to absorb the additional costs or pass them on.

In other cases, products could be renovated or adjusted – or companies can continually rebalance, said the analyst.

“Both early winners and losers from initial tariff policies must be prepared for potential countermeasures, policy escalations and de-escalations, and competitor responses. Early deviations from the baseline should not automatically be accepted as the new normal, and additional volatility should be factored into future demand planning.”

Alternatively, companies can look at new markets which are not impacted, or pivot and serve local markets instead.

Or, as we are already starting to see, shippers could look at developing existing US manufacturing sites.

Xeneta has also pointed out that the tariff environment is very uncertain. During the last Trump presidency, average spot rates spiked more than 70% on China-US west coast lanes as shippers sought to avoid incoming tariffs. But with rates already 24% higher than a year ago – owing largely to the Red Sea crisis – if they surge by the same amount, the market would reach an all-time high.

But Xeneta adds that if the tariff regime is not as weighty as feared, and the Red Sea opens for business again, then rates could collapse.

“You need to think differently,” Xeneta told shippers. Keep calm and do not do anything that limits your options down the line.

“You cannot base your freight procurement strategy on political rhetoric. We know tariffs on US imports are going to come, but we don’t know when, where, or what goods will be impacted.”

It recommended using index-linked agreements (ILAs) “to retain as much control as you can in a world of chaos”.

Another benefit of ILAs, it added, was that they help procurement managers explain internally to the executive team why freight spend is fluctuating by millions of dollars (up or down) against budget.

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