How to Respond to Tariff Policy Changes in Markets

🚨 A 20% Wake-Up Call: How Jordan’s Industry Leaders Must Respond to the U.S. Tariff. This is not just a tariff, it’s a test of leadership. For Jordanian business and industry leaders, this is a moment of truth. We can either wait and watch the consequences unfold or act with strategy and urgency. Here’s an example of how we must respond: 1. Understand the Impact: Identify which products are affected, quantify the exposure to U.S. markets, and assess how this tariff will impact pricing, contracts, and long-term competitiveness. 2. Immediate Business Adjustments: • Open discussions with U.S. buyers, some may share the cost or renegotiate. • Reassess pricing models to minimize shock to your customers. • Seek local government support for short-term relief or incentives. 3. Diplomatic & Collective Industry Action: • Coordinate with associations like @AmCham Jordan and Jordan Chamber of Industry. • Push the government to engage the U.S. diplomatically and challenge the tariff under FTA or WTO frameworks. • Present a united front to advocate for fair trade treatment. 4. Market Diversification: Reduce reliance on the U.S. by scaling into the EU, Arab region, and Asia, leveraging existing agreements like the EU-Jordan Association Agreement and GAFTA. 5. Re-think U.S. Strategy: If the U.S. remains critical to your business, explore: • Packaging or partial processing operations inside the U.S. • Joint ventures or distribution partnerships to bypass direct export barriers. 6. Internal Efficiency & Innovation: Sharpen your operations: cut costs where possible and invest in quality, branding, and innovation that justify higher prices even with tariffs. A Lesson from History: Mexico’s Tomato Industry: In 2019, when the U.S. hit Mexican tomatoes with a 17.5% tariff: • The industry quickly unified through associations. • The government engaged in high-level diplomacy. • U.S. buyers joined in to oppose the tariff. • Within months, a new agreement removed the tariff. Key Takeaways: • Unite as an industry: Speak with one voice. • Use trade diplomacy: The FTA is a shield, use it. • Engage your U.S. partners, Many will support your cause. • Act now before damage becomes permanent. This is a Leadership Moment, this tariff is not just a financial hit; it’s a test of how we lead in crisis. We must respond boldly, collectively, and strategically.

The Supreme Court Didn’t End Tariffs — It Reset the Game. The 6–3 SCOTUS ruling invalidating tariffs imposed under emergency powers doesn’t restore supply-chain certainty. It creates a new volatility cycle. With the U.S. Administration signaling it will re-impose tariffs under different legal authorities, manufacturers now face a dangerous mix of refunds, contract confusion, and policy whiplash. For U.S. companies, the next 6 months are about margin defense and continuity — not optimism. Here are 5 practical next steps to protect margins and stay in stock: 1. Freeze “Reversal” Decisions — Optionality Is Now the Asset Resist undoing supply-chain shifts made to avoid tariffs. Treat current sourcing as a portfolio, not a verdict. • Maintain dual or regionalized suppliers • Avoid re-concentrating volume into any single country • Preserve re-entry rights in supplier agreements Optionality > cost optimization in volatile situations. 2. Trigger a Contract Triage (Not Full Renegotiation) You don’t need to renegotiate everything — but you do need visibility. Prioritize contracts with: • Tariff pass-through clauses • Duty-indexed pricing • Force majeure tied to trade policy Create standardized amendment language now, before counterparties force the issue. 3. Protect Cash Like Tariffs Are Still Being Collected Refunds will be slow. Plan as if the money doesn’t exist. • Do not budget tariff refunds into 2025 operating cash • Re-evaluate borrowing tied to duty payments • Pressure-test working capital assuming tariffs return under Section 232 or 301 Liquidity buys time. Time buys leverage. 4. Reprice Products Quietly, Not Reactively If tariffs return under new authority, repricing windows will be short. • Model pricing scenarios now • Pre-approve pricing corridors internally • Communicate “policy-driven pricing” frameworks to key customers in advance The companies that explain early will adjust fastest. 5. Design Supply Chains for Policy Speed, Not Policy Clarity Trade policy now moves faster than physical supply chains. Assume: • Legal reversals • Congressional delays • Political escalation cycles Build systems that adapt — not structures that assume stability. Bottom line: The SCOTUS constrained how tariffs are imposed — not whether they exist. With the current U.S. Administration signaling new legal pathways and SCOTUS reshaping the rules mid-game, resilience now means preparing for permanent policy motion. This isn’t a reset. It’s the next planning cycle. And the companies that survive it will be the ones that stop treating trade policy as an exception — and start treating it as a core operating risk. Lets have a discussion. Lets discuss how many of these steps that make sense for you and your Company.

📦 Navigating Ongoing Tariffs: Strategies for Resilient Supply Chains The impact of ongoing Section 301 tariffs—particularly those targeting U.S.-China trade—continues to challenge global supply chains, especially in high-complexity industries like MedTech and Pharma. For procurement and operations leaders, the question isn’t if tariffs will affect your cost structure, but how prepared your organization is to respond. Forward-looking companies are adopting a multi-layered approach to mitigate tariff risk: ✅ Geographic diversification – Shifting production and sourcing from China to Vietnam, India, Mexico, or Eastern Europe to reduce tariff exposure. ✅ Tariff engineering – Reclassifying product components or altering designs to fit under lower-duty classifications. ✅ Contract restructuring – Negotiating supplier terms to share or offset tariff-related cost increases. ✅ Nearshoring & FTZs – Leveraging free trade zones, bonded warehouses, and regional production models to defer or avoid duties. ✅ Scenario planning – Embedding tariff impact into total cost models and proactively simulating “what-if” supply scenarios. In today’s climate, tariff mitigation is not a one-time event—it’s a strategic discipline. It demands cross-functional collaboration between sourcing, legal, tax, and logistics teams, paired with agile decision-making and up-to-date market intelligence. 🎯 Whether you're reshaping your supplier footprint or designing a more resilient operating model, it's clear that proactive tariff strategy is a critical lever for cost optimization and risk mitigation. 🔍 Want to learn more? Here are some helpful resources: - USTR Section 301 Updates - PwC Trade Insights - Bloomberg Tariff Tracker Let’s connect—what mitigation strategies are working for your organization?

We are thrilled to launch our latest research, uncovering the cost of new US tariffs on UK retailers with partner ESW. For UK non-food retail exporters, the US has been a fast-growing market since Brexit, outpacing domestic growth to reach £4.1bn in 2024. However, the US introduced a baseline 10% import tariff on imports from most trading partners, including the UK, alongside a 30% tariff on certain Chinese imports. This has immediate implications, including: ➡️ Increased landed costs: Margin pressure from baseline and reciprocal tariffs. ➡️ China-origin complexity: Disrupted DTC models due to loss of the $800 de minimis threshold. ➡️ Product strategy pressure: Strategic product withdrawals and sourcing shifts to navigate cost volatility. ➡️ Market hesitation: Delayed or reduced expansion plans into the US. By modelling trade flows and tariff rates on retail products, we calculate that UK non-food retail exporters are having to mitigate £618.5m in additional tariff costs from new US policy. Faced with rising tariff costs and mounting uncertainty, UK retailers have begun to implement a range of mitigation strategies to offset these additional costs. Four key tactical responses include: ➡️ Passing costs on to consumers: Some brands, supported by pricing power or strong equity, are passing on a portion of tariff costs – but this remains limited. Only 20% of the total cost is being passed through to consumers. ➡️ Absorbing costs: Around 16% of the tariff impact is being absorbed directly through reduced profit margins. ➡️ Exposure management: Retailers are reassessing product-level viability, pausing activity or withdrawing SKUs where tariffs have rendered them commercially unviable. ➡️ Cost efficiencies: Businesses are pursuing internal savings through strategic restructuring, supplier renegotiation and leaner operational practices. Specific responses by retailers vary by product, category and market, and will evolve over time. Read more about the responses in our latest research by downloading the full report here: https://lnkd.in/eVuYvkcb

Tariffs and transfer pricing - have we seen it already with COVID? Your TNMM benchmark looks perfect until market disruption hits. Then it's worthless. This problem pops up whenever significant disruptions occur. Today, it's tariffs. Yesterday it was COVID. Before that, the financial crisis. The pattern repeats (can we please stop?). The issue? You're preparing benchmarks using historical data that doesn't reflect current market conditions. Private company financials lag 1-2 years behind reality. By the time database providers update their information, the market has already moved on. Think about it: → 2023 financials for many companies won't appear in databases until late 2024 → Major tariff impacts happening now won't show up in your benchmarks until 2025 → Your tested party feels the effects immediately while your comparables data remains frozen in time Tax authorities aren't blind to this timing mismatch. They know your benchmarks don't capture current realities. And they can use this against you. What can you do? A few things. Make comparability adjustments to either your tested party or comparables → Normalize extraordinary costs → Account for volume changes → Factor in price fluctuations Leverage public company data for more current insights → Listed companies report quarterly → Industry trends become visible faster → Market changes are more transparent Document the disruption thoroughly → Build a compelling economic case for what happened → Collect evidence of how it impacted your industry → Prepare a quantitative analysis of the expected effect Consider alternative methods temporarily (but be VERY CAREFUL with this) → Is cost plus more reliable during this period? → Would a profit split better reflect shared market challenges? → Can internal CUPs provide stronger support? Monitor actual results against projections → Track how margins evolve as the disruption unfolds → Adjust your expectations based on real data → Be ready to explain significant deviations Be cautious though. More adjustments mean more subjectivity, which leads to more potential disputes. You need to balance economic reality with defensibility. Tax authorities prefer precision over accuracy. They'll often choose an outdated benchmark with exact numbers over a current adjustment with estimates - especially if their concerns lead to better tax outcomes for them! Your best strategy? Address the timing problem head-on. Don't pretend your benchmark captures current conditions when everyone knows it doesn't. Build your case with transparency, acknowledging the limitations while providing the best available alternatives. What other approaches have you used to handle benchmark timing issues during market disruptions?

90 Days to Prepare – U.S. Tariff Pause Is Not a Reprieve The U.S. has announced a 90-day pause before enforcing the full scale of its new baseline (10%) and reciprocal tariffs (up to 60%). For exporters in high-impact countries— Vietnam, Thailand, Malaysia, Taiwan, South Korea, India—this is not a breather, it’s a countdown. Here’s what exporters should be doing right now: • Engage U.S. buyers to align expectations on pricing, shipment timelines, and any changes to landed costs • Validate your product classifications and origin declarations—many are looking into tariff reengineering, but this needs to hold up under audit • Consider supply chain tweaks—assembly, packaging, or final processing in third countries may help, but origin rules are tightening • Review commercial terms (Incoterms, FOB/CIF, etc.) and logistics arrangements, especially for any switch B/L or drop shipment models • Strengthen export documentation and recordkeeping to withstand downstream scrutiny from U.S. Customs The risk isn’t just about higher duties—it’s about being flagged for misdeclaration, transshipment, or circumvention. And this 90-day window could become the enforcement staging ground. We’re actively working with clients across the region to model impact and build compliant response strategies. Don’t wait until the window closes.

As I observe the latest developments in the U.S. tariff hike, it's clear that cross-border sellers like myself need to rethink our strategies. Trump's aggressive trade policies are imposing significant tariffs on imported goods, with countries like China facing a 34% rate, Vietnam at 46%, and Cambodia at 49%. These tariffs, combined with previous ones, make exporting from these regions increasingly challenging. Even Vietnam and Cambodia, once alternatives to China, are no longer viable due to steep tariffs. This shift isn't just a sudden move; it's part of a broader U.S. strategy to promote local manufacturing and economic contribution. The era of cheap exports and tax loopholes is coming to an end. Industries built on OEM or ODM models will be hit first, as production shifts to places like Mexico. Additionally, the end of the $800 de minimis exemption starting May 2, 2025, means direct-to-consumer packages will face taxation, impacting low-margin items. Platform sellers on Amazon and Walmart aren't spared either, facing increased fees and restrictions. Only strong brands with operational control seem likely to weather this change. As I reflect on these changes, it's evident that the U.S. is pushing for a more localized economy. The message is clear: if you want to stay in the game, you need to relocate, hire locally, pay taxes there, and contribute to their economy. This isn't just about tariffs, it's a political strategy aimed at reshaping global trade dynamics. For cross-border sellers, this means evolving beyond just exporting. We need to become adept at navigating tax systems, managing global logistics, and strategizing market planning. The future of cross-border e-commerce requires adaptability and a willingness to evolve with these changing times. #GlobalTrade #TariffHike #TradePolicy #USChinaTrade

Dealmaking just got a whole lot harder. We’re on tariff time now. If you’re trying to buy or sell a business, gear up as changes make way through markets. Uncertainty is high. Valuations will shift. But opportunities remain. Buyers need to ask the right questions, and sellers need to get ahead of this. Here’s a list to supplement your diligence. Questions: • How is the business impacted by tariffs? • What’s the hit to gross margins? (by product and segment) • What’s the plan to address cost increases? (absorb, pass through, cut elsewhere?) • Relative to competitors, is the business uniquely exposed or uniquely protected? (maybe it’s a winner) • What’s the exposure by supplier? (examine last 2 TTM periods of spend, by product and country of origin) • What’s the exposure by customer? (examine last 2 TTM periods of sales, with industry/segment and location) • Are alternative suppliers available and being pursued? • What supply chain disruptions have occurred or are expected? What’s the contingency plan? • What import/export regulations affect the business, if any? Documents: • Supplier contracts (look at price escalation, force majeure, termination). • Customer contracts (same – may need to deploy them). • Communications with suppliers (look for disputes, price hikes, terminations, slowdowns). • Communications with customers (look for disputes, pullbacks, pricing issues, bad debts). • Import/export licenses, permits and compliance procedures. • Any past or current investigations or disputes related to customs or trade laws. The policy climate can change with the stroke of a pen. Already has! Don’t do deals the same way you were doing them last year. What would you add to this list?

Tariffs Are Reshaping Global Trade, So Now Is The Time to Act As I have been telling clients nonstop for the last several weeks, now is the time for senior management and boards of directors to shift from reactive crisis mode to strategic reinvention. With sweeping new tariffs and threats of retaliation, the risks to cost structures and competitiveness are too significant to ignore. My advice to boards and executive leadership: 1. Quantify exposure. Assess financial impact across product lines, suppliers, and markets. 2. Reimagine your network. “China+1” isn’t enough. Adopt a “Region for Region” model and explore nearshoring thresholds. 3. Leverage regulatory levers. Use Foreign Trade Zones, duty drawback programs, and tariff engineering. 4. Build resilience. Implement cross-functional pricing strategy, scenario planning, and AI-powered modeling. 5. Act at board level. Make supply chain transformation a governance priority—not just a crisis response. This is more than risk mitigation—it’s a chance to build competitive advantage. Treat tariffs as the catalyst to reinvent your supply chain for long-term resilience. #SupplyChainResilience #TariffStrategy #GlobalTrade #ExecutiveLeadership #BoardGovernance #TradePolicy #RiskManagement #DigitalSupplyChain #Nearshoring #CrisisToOpportunity

I will block any political commentary instantly. This is not about politics…This is about not ignoring the elephant in the marketing room. Here are SPECIFIC tactics to use because of the impact of the Tariff discussion…. It doesn’t matter if tariffs directly affect your business because they directly affect your prospects and customers. No matter what industry – business or consumer. Here are some very specific tactics to consider ensuring your marketing is doing as well as possible as these economic changes occur… When costs rise (or people think they will rise) it’s the marketer’s job to: ✔️ Message it ✔️ Protect brand trust ✔️ Retain conversions ✔️ Do more with less Here’s how to tactically adjust your marketing in response, with strategies broken down for both Business and Consumer audiences: Business to Business: Communicate Pricing Adjustments Transparently Use phrases like “Price Transparency” or “No Surprises” in subject lines, landing pages and websites. EVEN IF PRICING DOESN’T CHANGE you should tell everyone that. They don’t know what you know about your business. Use “Price Adjustment Transparency” Messaging Promotional Email Subject lines: -No Surprises: Here’s Why Pricing Is Changing -How We’re Managing Rising Costs—So You Don’t Have To STAT:🧠 Edelman: Transparent brands are 22% more likely to retain loyalty in economic downturns. Focus on ROI + Cost Consolidation Promotional Email Subject lines: -This replaces 3 other platforms -Spend smarter, not more -Same output. Lower cost. Make the CFO your marketing partner. STAT: 💡Kantar found that value-driven messaging during the 2008 recession boosted response rates by up to 15%. Annnnd - MUST DO! Prioritize Case Studies + Social Proof When stakes are high, buyers seek safety. For CONSUMER Marketers: Align With Search Behavior: Google shows spikes in search terms like “best value,” “trusted brands,” and “most reliable” during downturns. Use these phrases in subject lines and CTAs to match consumer intent. Show You’re on Their Side: STAT: McKinsey notes that 57% of consumers actively look for “value packs” and “fair pricing” during tough times. Be explicit in messaging: “Bundle & Save”, “Price Lock Guarantee”, etc. This isn’t about politics. This is about not ignoring the elephant in the marketing room. People want to feel comfortable when things get uncomfortable.