Tariffs have been around for centuries. Commonly used to protect emerging industries or bolster national security, tariffs have evolved beyond trade tools into economic levers that can shift markets overnight. Tariffs have re-entered the conversation for mid-sized business leaders, especially those with global supply chains or international customer bases. But here's the thing: reacting like it’s still 1995 won’t cut it.

Part 2: The Misconception That Could Cost You Customers

When faced with rising costs due to tariffs, many businesses reach for the same lever: raise prices. Simple enough, right? But that lever is often pulled too hard, too fast, and with too little nuance.

Here’s the reality: a 10% tariff on your imported goods doesn’t automatically translate to a 10% increase in your prices. Yet that’s exactly the mistake many companies make, assuming a pass-through is the easiest way to maintain margin.

What it does instead is create pricing shock—for channel partners, for end customers, and even internally among your own salespeople. And when pricing shock sets in, trust and traction can disappear overnight.

Understand the Layered Impact

Let’s break it down. A tariff increases your cost of goods. Yes, that might affect your gross margin. But how much of that increase really needs to hit your customer? Not all of it. And certainly not all at once. Between variable margins, negotiated contracts, and customer expectations, you likely have more room to maneuver than you think. Also, think in terms of dollar effect, not percentages. Passing through a dollar increase is a lot easier to stomach than a percentage multiplier down the supply chain.

More importantly, your customers are feeling it too. They may be buyers who are absorbing costs on other inputs. They might already be skittish about future increases. Price sensitivity is high in volatile markets, and they’re watching closely to see which partners are transparent, fair, and stable.

Communicate the Why, Not Just the What

Raising prices without explanation is a recipe for churn. Your messaging matters now more than ever. A strong go-to-market response includes:

• Pricing playbooks with scenarios and rationale
• Sales enablement tools that frame the increase as a shared challenge
• Thoughtful communications that explain your commitment to quality, service, and long-term value

When done well, this isn’t just damage control. It’s brand building.

Align Internally First

Your sales team is the tip of the spear. If they don’t understand the rationale, they won’t defend the increase. Worse, they may discount reactively, undercutting your pricing discipline altogether. Make sure your finance, sales, marketing, and product teams are aligned—and that your messaging, pricing guidance, and competitive intelligence are reflected in your delegation of authority and updated as needed

Manufacturer Action Plan: Smarter Selling Through Tariffs

Manufacturers who sell through channels need a stronger playbook than just "mark it up."

• Break Down the Tariff Impact: Show your reps how a 10% tariff may only translate to a 3-4% end-user impact after markup layers.
• Create Visual Tools: Use simple infographics and calculators to help explain cost impact to distributors and end-users.
• Segment Your Pricing Strategy: Consider differentiated approaches based on product tier, customer size, or value-added services. Take this opportunity to consolidate product ranges and discontinue old products.
• Use Tariffs to Reinforce Value: Show how your reliability, responsiveness, and product quality offset modest price increases.
• Train Sales Teams Thoroughly: Don’t just send a pricing memo—equip your team with language, confidence, fortitude, and scenarios to manage exceptions. In short, give them spine.

Key take-aways

1. A tariff-driven cost increase does not equal a 1:1 price hike.
2. Customers value transparency. Share your rationale and reinforce your value.
3. Equip sales with the messaging and tools they need to lead—not defend—pricing discussions.
4. Internal alignment across finance, marketing, and sales is critical.
5. Price increases are a test of trust. Don’t fail it by going silent.

What’s Next:

In part 3 of our series on tariffs, we flip the script and explore what buyers of tariffed goods can do to stabilize supply, rethink sourcing, and protect margins. 

In the meantime, schedule your free 1-hour consultation now.

Catch up on the full series:

• Tariffs and Your Next Chapter: Turning Disruption into Go-to-Market Growth
• Tariffs and Your Next Chapter | Selling Through Tariffs: Avoiding the Pricing Traps
• Tariffs and Your Next Chapter | Buying in a Tariff Economy: Smarter, Not Cheaper
• Tariffs and Your Next Chapter | The 5 Biggest Mistakes Leaders Make Around Tariffs
• Tariffs and Your Next Chapter | From Cost Burden to Market Edge: Turning Tariffs into a Competitive Advantage