BIGGEST POTENTIAL STUMBLING BLOCKS
Over-reliance on single sources: Relying too heavily on a single supplier, region, or transportation method leaves businesses vulnerable to disruption. Whether it’s unexpected delays, natural disasters, or economic shifts, the solution lies in diversification— expanding networks, exploring regional options, and building flexibility into operations. – JEFFERY BENORE , President and CEO, Benore Logistic Systems Material shortages are a challenge for logistics to tackle, especially in the context of China denying the shipment of rare earth elements and commodities back to the United States. This has further implications for the supply chain, which will need to increase focus on eciency in power, resource management, and manufacturing to combat any lack of trade with China. – KEVIN NOVAK , Managing Partner & Founder, Rackhouse Ventures
Carriers will confront a slow recovery. The freight recession, triggered by a slowdown in goods consumption, home construction, and manufacturing, combined with an influx of new carriers and collapsing rates, left many small trucking operations vulnerable. Despite this, carriers should leverage their pandemic- era savings to make strategic investments for long-term growth as the industry recovers. – NICK DARMAN , Founder and CEO, Alvys
– STEVE SCHLECHT Director, Strategic Initiatives, Buske Logistics disinterested in policing international waterways, disrupting trade flows. Escalation of U.S./China trade wars from the new administration, causing reshuffling of suliers around the world. Signs that China wi invade Taiwan, thus mass chaos in the suly chain similar to what we saw during the pandemic. The United States becomes
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Weakening supplier relationships: Amid ongoing global trade uncertainties, strong supplier partnerships are crucial for resilience. Businesses that fail to nurture these relationships risk losing reliability and flexibility in their supply chains. – SÉBASTIEN BREATEU , Founder and CEO, QIMA
How to Mitigate the Impact of Tariffs By Darpan Seth, Co-Founder and CEO, Nextuple
trade agreements—for example, Walmart and Target diversified their sourcing beyond China. The downside is that this can lead to longer lead times and quality control issues. ♦ Shifting manufacturing geographies , such as Steve Madden and Crocs moving production to Vietnam and Cambodia. This requires substantial investment and can disrupt existing supply chains. ♦ Adding “logistics hops” such as transshipment through tari- free countries, as some apparel companies are doing. But this increases transportation costs and complexity. These strategies require careful cost-benefit analysis, balancing tari avoidance against operational complexity and potential supply chain disruptions.
The proposed taris are expected to impact omnichannel retailers’ operations. The anticipated increased cost of imports will force buyers to either seek cheaper alternatives or absorb higher costs, thereby impacting profit margins. Contract negotiations with suppliers and vendors will be more challenging due to tari-induced price fluctuations. To mitigate these negotiations suppliers will price
impacts in the mid-term, retailers are employing various strategies: ♦ Developing relationships with alternative suppliers impacts various relationships alternative more in countries with more favorable
100 Inbound Logistics • January 2025
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