Navigating Tariff Uncertainty: How Strategic Planning Can Create a Competitive Advantage
Over the past six months, we've had dozens of conversations with clients, prospects, and industry leaders about tariffs trying to understand their impact on the industries we serve. A consistent theme has emerged: the approach for implementing and negotiating tariffs has created near-term uncertainty and introduced widespread hesitation across industries.
At Avatria, we’ve been working closely with companies grappling with this uncertainty to help them prepare, not just react. The insights we’ve gathered highlight both the challenges and the opportunities created by the current climate. In this post, we’ll share what we’ve learned and how organizations can turn this moment of uncertainty into a strategic advantage.
Tariff Whiplash: A Problem of Uncertainty
Tariffs are projected to drive a 9.5% increase in the cost of investment goods, which are equipment, machinery, and other tools businesses use to produce their goods and services. Additionally, the erratic pattern of implementation, reversal, and renegotiation is creating operational whiplash.
These two factors are causing companies to hit pause rather than move forward with key investments or innovation programs. The fear of committing resources to strategies that may be upended by tomorrow’s policy change is understandable. But this “wait-and-see” mindset has its own risks; most notably, the risk of falling behind more proactive competitors once the dust settles.
What We’re Hearing from Businesses
We’ve spent the last six months speaking with executives, digital leaders, and industry experts to understand how companies are adapting. Here’s what we found:
Many companies proactively took action to address the impact of tariffs by shifting manufacturing to southeast Asia (particularly Vietnam and India) and Central & South Americal (particularly Brazil and Mexico), stockpiling inventory domestically, reducing overhead (including implementing personnel reductions), and/or preemptively starting to pass cost increases onto consumers.
Business leaders are waiting for tariffs to stabilize. The lack of clarity around whether tariffs will increase, decrease, or disappear altogether is causing widespread indecision. Industry experts expect them to settle around 15-18% on average (weighted toward China) but timing remains unclear.
As a result, projects are being delayed and distributors are being hit particularly hard. With the costs of investment goods rising, many companies are pausing construction projects and equipment upgrades, which is leading to order cancellations with manufacturers and distributors. This is causing many of these businesses to pause any project that isn’t directly tied to revenue or keeping the lights on. For many this has already resulted in staff reductions that we expect to accelerate if conditions do not quickly improve.
Despite the frustration, this pattern also reveals a critical insight: the companies that use this period to prepare will be best positioned to move quickly when once tariffs settle to their long-term levels.
Best Practices for Strategic Planning in Times of Uncertainty
In this environment, agility and readiness are more important than ever. Here are three best practices we’re recommending to clients:
Develop Pivot-Ready Strategies: Instead of delaying plans entirely, organizations should invest in strategy work that prepares them to act quickly when conditions allow. Whether that means modeling cost scenarios, identifying operational levers, or outlining phased implementation roadmaps, the key is to have multiple executable approaches at the ready when the time comes.
Focus Your Business Case on Incremental Value: Strategic projects don't need to be “all or nothing.” By focusing on modular solutions and phased ROI, companies can start with low-effort, high-impact initiatives that provide flexibility if conditions change again.
Partner for Perspective and Acceleration: Firms like Avatria bring both outside perspective and execution expertise. We’ve helped clients in complex environments build roadmaps that balance caution with forward progress.
How Avatria Can Help
We specialize in building strategies that make use of AI and modern digital technologies to help businesses stay resilient in volatile markets. Some examples:
Anixter: Avatria helped Anixter create a digital commerce roadmap aligned with their international expansion goals and executed it incrementally to deliver value to individual regions when they were ready.
Take 5 Wash and Oil: We worked with Take 5 to craft a loyalty program that gave them the agility to adapt quickly to market and technology shifts, and allowed them to roll out their program in phases as they proved value.
Our experience shows that with the right plan in place, companies can turn external uncertainty into a strategic edge.
Conclusion: Planning Now is Crucial to Avoid Being Leap-Frogged
Tariff-related volatility may be out of your control, but how you prepare isn’t. By using this time to develop executable strategies, you can avoid costly delays and be first out of the gate when conditions improve. Ready to prepare for what’s next? Contact Avatria to learn how we can help you plan with confidence.