Tariffs and Your Next Chapter | Buying in a Tariff Economy: Smarter, Not Cheaper

Written by Per Ohstrom | Wed, Apr 9, 2025

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 3: How Strategic Sourcing Becomes Your Competitive Advantage

If you’re on the purchasing side of the tariff equation, you’re likely feeling pressure from two sides: rising input costs and internal demands to protect margin. Many companies react by squeezing suppliers or scrambling for cheaper alternatives. But that short-term mindset can create long-term risk.

What if you reframed sourcing from transactional to strategic? What if this disruption became a catalyst to build a stronger, more resilient supply chain—one that supports your go-to-market strategy rather than reacting to its failures?

Beyond Cost: What Else Should You Be Evaluating?

Tariffs force a deeper look at supplier relationships. You’re not just buying components—you’re buying reliability, agility, and risk posture. It’s time to ask:

Where is supplier concentration creating vulnerability?
Are there domestic or nearshore alternatives?
How strong is your forecasting and collaboration process?
Are you sharing cost realities transparently with your key suppliers?

Shift from Sourcing to Scenario Planning

Many procurement leaders are becoming scenario planners. They run tariff impact models. They build dual-source strategies. They work with go-to-market leaders to understand where costs can be passed, absorbed, or offset with value-added services.

This cross-functional collaboration—procurement, sales, marketing, and finance—creates a holistic tariff strategy, not a siloed one.

Supplier Collaboration Is Your Secret Weapon

Some of your suppliers are as rattled as you are. Open a dialogue. Explore shared incentives to maintain volume, find efficiencies, or navigate logistics together. A long-term partner will work with you to find creative solutions that protect your mutual growth.

Manufacturer Action Plan: Strengthen Your Sourcing Muscle

For manufacturers, the supply chain is a strategic asset. Here's how to make it more resilient:

Diversify Suppliers: Don’t wait for a crisis. Identify and qualify alternate sources—especially in non-tariff regions.
Negotiate More Than Price: Focus on flexibility, lead time, and contingency clauses when signing agreements.
Create an Exposure Map: Chart your parts and inputs by geography and tariff category. Make it visual and shareable across teams.
Incentivize Supplier Alignment: Reward partners who support shared forecasting, transparency, or co-invest in mitigation.
Document Learnings: Turn today’s sourcing pivots into repeatable best practices for future disruptions.

Key take-aways

Cost-cutting is not a strategy. Strategic sourcing is.
Evaluate your supplier base for concentration, agility, and risk.
Use tariffs as a forcing function to build smarter sourcing models.
Integrate procurement with go-to-market planning.
Collaboration with suppliers can unlock unexpected value.

What’s Next:

In part 4 of our series, we highlight the most common mistakes mid-sized companies make in response to tariffs—and how to sidestep them.

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

Catch up on the full series:

View full post