SupplyChainTalk: Navigating supply chain tariffs – challenges and opportunities for the industry

On 9 July 2025, SupplyChainTalk host Alastair Charatan was joined by Nanda Kishore, VP of Sourcing, Evoy; Srinivas Suresh, Supply Chain Lead, Joby Aviation; and Nitin Murali, Vice President Supply Chain Excellence, Gallo. 

 

Views on news 

A Times supplement article highlights how Amazon’s Supported Internship programme, working with DFN Project SEARCH and UK colleges since 2021, is providing lifechanging opportunities for autistic young people and those with learning disabilities. The scheme combines structured classroom learning with practical workplace experience, leading many interns to permanent jobs. 

 

Managing tariffs in the short and medium term 

The baseline tariff to be imposed by the US is 5%, which can go up to 50% for US trade partners which have got huge trade surpluses. At the time of this episode of supply chain talk, the countries that struck a trade deal with the US are only the UK and Vietnam. As a result of tariffs, Chinese products get diverted to Europe and emerging markets, while firms are relocating production to Vietnam and India.  

 

With some products, even a 10% increase in tariffs can wipe out their margin structure. Vertical integration can buffer the negative effect of tariffs considerably. Tariffs also impact sales through changing buyer sentiments in countries like Canada. Another challenge in the beverages and alcohol industry is that protected drinks such as prosecco can’t be nearshored. Some industries are expected to be hit by retaliatory tariffs in the longer term too.  

 

Although contracts with customers may contain clauses that allow for price increases in the case of duty or tariff hikes, they usually focus on delays and force majeure. Mitigating the negative effects of tariffs is fundamentally about building a tariff-tolerant ecosystem, including flexible supplier networks, agility in design and end-to-end visibility combined with multi-country sourcing and what’s referred to as tariff engineering – optimising the level of tariffs through assigning products to the most favourable HS code.

 

At the moment, building immunity to tariffs is a big challenge because of the variables that keep moving.  Another way of minimising tariffs is leveraging free trade zones, which enables businesses to delay tariff payment up to 5 years. Small businesses will be hit by tariffs the most due to their limited buying power and influence. However, dozens of small businesses can come together and create a free trade zone between themselves.  

 

There is also a case for having discussions with the company’s tier 3 and 4 suppliers about how they could diversify their own supply chains. Managed supply chain ecosystems will have a competitive advantage, as they will be able to adjust to changing tariffs more than individual companies. ESG can also make the biggest impact if it’s applied to the entire supply chain ecosystem.  

 

The panel’s advice 

• Rush decisions in response to tariffs may not bring good results. A more strategic approach is required to find long-term solutions.  
• Think about managing tariffs as hedging your supply chain.  
• The tariff problem must be solved collectively with shared infrastructure and intelligence.  
• The future is supply chain ecosystem orchestration and management.