The Trump administration has revived tariffs as a core instrument of U.S. trade policy, imposing  sweeping new duties on imports from Canada, Mexico, and the European Union, a 10% baseline  tariff on nearly all U.S. imports, and sharply elevated rates—up to 145%—on Chinese goods.  These actions and the threat of even greater tariffs to come have triggered a rapid escalation in  trade tensions, with U.S. trading partners announcing retaliatory tariffs of their own. 

Read also: Tariffs Trigger Price Hikes as US Retailers Shift Strategy

For retailers, the result has been a surge in sourcing costs, mounting supply chain complexity,  and growing uncertainty in pricing and planning. Some companies have responded by front loading inventory or passing on costs to consumers, but those reactive approaches alone are  insufficient for what is increasingly looking like a structural shift in global trade. The new  normal will require long-term strategic adaptation. 

A new report from TradeBeyond, Managing Tariff Turbulence in Supply Chains, highlights eight  strategies that brands and retailers are using to build resilience and mitigate the risks posed by  tariffs this year and beyond, including diversifying supplier bases, employing real-time scenario  planning, and exploring tariff engineering. 

Diversifying Suppliers and Sourcing 

While diversification has long been a foundational sourcing principle, 2025 has exposed just how  fragile even moderately diversified supply chains can be. The recent tariff escalation caught  many companies off guard—particularly in high-risk categories like apparel and consumer  electronics—despite efforts to broaden their supplier base. 

What’s different now is the speed and scale of tariff changes, which are forcing brands to  reassess not only their country exposure but also their supplier readiness. Many are moving  beyond basic diversification, building out multiple pre-vetted alternatives in each major category  and negotiating capacity-sharing agreements that enable production to shift on short notice. 

To reduce exposure, sourcing teams are now identifying new suppliers in lower-tariff regions  and adjusting their logistics networks accordingly. Some maintain a preferred vendor list within  a centralized sourcing platform, ensuring two or three vetted alternatives in each major product  category. Others are negotiating capacity-sharing agreements that allow production to shift  quickly without the need for renegotiated factory approvals. 

Mapping out a complete alternate supply chain on short notice is difficult and time-consuming,  which is why leading companies are turning to digital platforms that centralize supplier profiles,  certifications, and performance data. Real-time visibility into supplier capabilities and  compliance metrics is critical for managing the volatility of today’s new global trade order.

Operationalizing What-If Planning and Scenario Modeling 

Uncertainty around tariffs has made scenario planning essential. Retailers need to be equipped to  model different sourcing, pricing, and inventory outcomes quickly—at any point in the planning  cycle. Scenario planning enables teams to ask “what if” questions: What if tariffs rise another  10%? What if a preferred supplier is suddenly targeted by new duties? What if rerouting or  reshoring could reduce total landed cost? 

The most resilient organizations are enabling cross-functional teams—not just finance—to run  these simulations in real time. That requires a multi-enterprise platform that centralizes landed  cost inputs and supports granular, SKU-level modeling based on shifting trade policies. The goal  is to move from reactive cost-cutting to proactive decision-making. 

To enable this, businesses are adopting open costing systems that incorporate full cost  breakdowns beyond just FOB pricing—factoring in freight, duty, insurance, and compliance  costs. When combined with real-time HTS classification data, these tools ensure accurate duty  calculations and allow for rapid response to new tariff conditions. This is no longer a theoretical  exercise; it’s a core competency for companies navigating today’s sourcing challenges. 

Exploring Tariff Engineering 

Some companies are taking a more technical approach by exploring tariff engineering— modifying product design or classification to qualify for lower tariff rates. For example, an  apparel manufacturer might adjust the fiber composition of a shirt to reduce its applicable tariff.  Others are auditing high-risk SKUs to identify reclassification opportunities or substitute inputs  that maintain quality while reducing costs. 

Accurate tariff classification is the foundation of this strategy. Companies must ensure that every  product has an HTS code assigned at the item level based on material composition, construction,  and intended use. Misclassification can lead to overpayment or regulatory penalties, which  makes regular auditing and staff training essential. 

Businesses are also revisiting duty drawback programs, which allow companies to reclaim tariffs  paid on goods that are eventually exported. Additionally, some are leveraging foreign trade  zones (FTZs) to defer or eliminate tariffs on goods processed or stored within those areas. While  these strategies may seem niche, they can offer meaningful savings—especially when margins  are tight and tariffs are high. 

These and other strategies are covered in greater depth in TradeBeyond’s new Managing Tariff  Turbulence in Supply Chains report. As the trade landscape continues to shift, companies that  invest in flexibility, transparency, and cross-functional coordination will be best positioned to  thrive. Tariffs may be unpredictable, but with the right strategies in place, retailers can protect  profitability and maintain supply continuity.

Author Bio

Eric Linxwiler is Senior Vice President of TradeBeyond. He has over 30 years of experience in  enterprise software and cloud-based platform companies with a specialty in supply chain  optimization and workflow management.