Tariff Series - Best Practices for B2B Distributors and Manufacturers in a Tumultuous Time

The U.S. recently introduced new tariff measures as part of its broader trade strategy. On February 1, 2025, a 10% tariff on imports from China took effect, prompting China to counter with tariffs on U.S. coal, liquefied natural gas, crude oil, agricultural machinery, and certain vehicles. Meanwhile, a planned 25% tariff on imports from Canada and Mexico has been postponed for one month, though a lower 10% tariff remains in place for Canadian energy resources. The ripple effects are likely to be felt by manufacturers, as rising costs for certain inputs put pressure on production expenses, while distributors face higher supplier prices and may have to pass those costs on to their customers.

Nearly every customer we work with is impacted by tariffs in some form or fashion. The administrative burden alone is an unforeseen curve ball, as some companies have had to dedicate one or more full time employees to the cause. This is because the products included in each tariff exclusion changes each month, bringing substantial additional paperwork and a steep penalty for underpayment or nonpayment.

Beyond administration, tariff actions are highly impactful to financial results. The challenges revolve around changing cost basis, updating prices and making inventory decisions that incorporate tariff considerations. If a company’s costs are increasing due to tariffs, they do have a number of options on the table for an effective response.

The right tariff strategy is unique to each business, so our expert team has put a lot of thought into various pricing game plans based on real-world customer experience.

The discussion continues in our Talking Tariffs series, where we cover:

How tariffs work and how it impacts pricing 

What pricing tactics and strategies can help

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