BEYOND THE BUZZ
Turning Tari Volatility into Logistics Advantage By DeAnna Harner Executive Supply Chain & Operations Advisory Lead, America’s Manufacturing, CPG, and Retail EOU, Avanade
Unpredictable swings in trade policy and tari s now drive disruption. Each new development forces global companies to adjust sourcing, recalculate landed costs, and rethink pricing, often with little lead time. While tari s have been around for hundreds
Gaining Real-Time Visibility The ability to simulate the impact of tari shifts in real time and coordinate across sourcing, finance, and logistics teams is now a strategic advantage. Look for solutions that o er: automated tari data ingestion and SKU-level mapping; AI-driven simulations of landed cost changes; real-time alerts and what-if modeling; and integration with ERP and WMS platforms. Some solutions are built on low-code platforms enabling rapid deployment without disrupting current systems. In one example, an international retailer with $3.5 billion in annual revenue implemented a tari management protocol using such a system. The result? An expected $36.5 million in recaptured margin annually, thanks to automated tari -to-SKU mapping and faster reaction times. Beyond financial gains, the company gained agility—the ability to simulate scenarios instantly, act on trade shifts quickly, and align teams around a single source of truth. Decision Time: Key Questions to Ponder If you lead logistics, sourcing, or supply chain strategy, consider: • How confident are you in your organization’s ability to adapt quickly to trade shifts? • Are your current tools fast and accurate enough to support “what-if” planning? • How much margin is being lost due to manual processes or delayed updates? • Can your systems align procurement and logistics strategies in real time? In an industry where resilience and responsiveness are the new currency, tari management isn’t a tax issue. It’s a supply chain mandate. Taris have turned supply chains into a geopolitical chessboard—every move carries strategic risk. To stay ahead, companies should stress test sourcing models for tari exposure, risk, and supplier concentration just like a financial portfolio. ADAM BECKERMAN, Manufacturing and Distribution Leader Aprio
of years (in the 1700s, they were the primary way the young U.S. government raised revenue), what’s di erent now is the pace of change and the operational strain it causes behind the scenes. Every shift in tari rates means logistics and procurement teams must: • Update pricing databases with per-item accuracy • Factor in multi-country, multi-currency impacts • Analyze cost-to-serve by SKU and supplier location • Reassess sourcing lanes and fulfillment routes And all of this must happen before even beginning to make decisions like: • Do we absorb some or all of the new cost? • Should we shift suppliers to mitigate exposure? • Can we adjust stocking strategies in advance? • What’s the ROI on reshoring production? For organizations still relying on manual processes, this complexity compounds and creates real margin risk. APPAREL BRANDS ARE BATTLING TARIFFS : GAP INC. warned that tari s could pile on up to $300 million in incremental costs in 2025 alone. It’s aiming to reduce Chi- na sourcing from under 10% in 2024 to under 3% by year-end and limit any single country to 25% by 2026. ABERCROMBIE & FITCH expects a $50 million tari hit this year despite sourcing across 16 countries. AMERICAN EAGLE OUTFITTERS anticipates $40 million in added costs and is pushing to get China exposure below 10% by the holidays. Rob Garrison, senior director of enterprise, TradeBeyond, details how apparel brands are redesigning supply chains for tari resilience here: www.inboundlogistics.com/articles/ fashion-in-flux/
30 Inbound Logistics • July 2025
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