A rising tide of tariffs is prompting a strategic rethink across global supply chains, with trade professionals warning that the impact of protectionism is no longer short-term or cyclical. A new report from Thomson Reuters finds that while more than 80% of firms are actively managing tariff risk, the majority believe trade barriers are here to stay, and nearly half are already seeing increased costs and margin pressure as a result.

The 2025 Tariffs Report, based on a survey of 285 global trade professionals working at companies with over US$200m in annual revenue and exposure to US trade, offers a comprehensive look at how businesses are navigating a deeply unstable policy environment.

Tariffs, turbulence and tighter margins

Unsurprisingly, increased costs and supply chain disruption were cited as the biggest consequences of US-imposed tariffs and the retaliatory measures they have triggered. On average, US companies believe 23% of their imports and 26% of their exports are now at risk due to these policies. Firms outside the US report similar concerns, with 26% of their exports to the US deemed vulnerable.

Price volatility is adding to the problem. Companies are finding it difficult to forecast landed costs or set pricing strategies with confidence, particularly in consumer-facing sectors. Margins are coming under pressure, and businesses are either absorbing costs or passing them on to customers.

The situation is further complicated by looming changes to de minimis rules. From 2 May, shipments under US$800 from China and Hong Kong will no longer qualify for duty-free treatment. Around 65% of survey respondents expect this shift to have a high or moderate impact on their operations.

The supply chain shuffle

With disruption mounting, firms are actively rethinking their sourcing models. Nearly three-quarters (72%) said they are either changing or considering changes to their supply chains to better manage tariff risk. Some are relocating production, others are exploring nearshoring, and many are pursuing origin or classification engineering to reconfigure trade flows.

A further 52% of firms said they are renegotiating supplier contracts, and nearly half (49%) are frontloading inventory to get ahead of tariff deadlines. These tactics reflect a desire to preserve continuity without locking into long-term cost increases.

A separate subset of respondents (35%) are considering bringing manufacturing closer to home, particularly within North America. Meanwhile, 34% are exploring the use of Foreign Trade Zones or bonded facilities to defer duties. Usage of bonded warehouses is especially prevalent among large manufacturing firms, particularly those in the automotive and industrial sectors.

What’s tech got to do with it? (Quite a lot, actually)

Technology is becoming central to how companies understand and respond to tariff complexity. Almost two-thirds (64%) of respondents to the Thomson Reuters survey said they use digital tools to analyse trade lanes, and more than half use software to model scenarios, map supply chains, and identify savings opportunities.

Combined with those currently exploring such tools, total adoption and interest exceeds 90%. That points to growing recognition that real-time data and automation can help companies stay nimble in an environment where rules change by the week.

Trade compliance functions are evolving fast. Software that integrates tariff management into sourcing and finance platforms is gaining traction. Automation of certificate-of-origin verification is also on the rise, helping firms benefit from free trade agreements while staying compliant. One example from the report found that firms leveraging digital tools to identify alternative sourcing options were able to respond to policy changes up to 30% faster.

Fixing the roof in a thunderstorm

While technology uptake is increasing, data quality and integration remain pain points. Many companies still lack full visibility across suppliers, logistics partners and geographies. Without a single source of truth, tariff exposure modelling becomes a game of guesswork.

Companies are also struggling with organisational silos. Trade, tax, legal and finance teams often operate in isolation, making it harder to develop cohesive strategies. Some respondents said they had only recently begun centralising their trade functions, despite the persistence of tariff-related challenges.

There is also evidence that many businesses are reacting rather than planning. In some cases, basic contingency measures are being implemented years after the first major tariffs took effect. The need for proactive scenario modelling and governance is clear.

Stark regional differences

Regional divergence is becoming more apparent. US-based companies are more likely to be taking action, with 60% reporting that they are implementing or exploring multiple mitigation strategies. These include automation, tariff reclassification, and scenario modelling.

In Europe, the emphasis is more on supplier renegotiation and classification review. Around 45% of European respondents said they are investing in internal training to better manage tariff risk.

Asian firms showed a strong preference for engineering solutions, including origin manipulation and value shifting. Over 55% of firms from Asia Pacific said they were implementing technical product reclassification to reduce duty exposure.

These regional variations are shaping global trade flows. Companies headquartered in North America and Europe are increasingly sourcing from Southeast Asia, while those based in Asia are building secondary supply chains outside of China to manage regulatory uncertainty.

Most survey participants see tariffs as more than a temporary disruption. In fact, 76% believe US-imposed tariffs reflect a longer-term shift in trade policy that will last for at least the next four years. This expectation is fuelling greater investment in resilience, even among firms that had previously relied on ad hoc workarounds.

Cost management, supply chain agility and technological readiness are no longer viewed as optional; they are fast becoming central to how businesses compete. That sentiment is particularly strong in North America, where respondents were more likely to report action across all fronts.

Across all regions, however, the mood is one of caution. With additional tariffs looming and enforcement subject to political swings, trade professionals say they are watching regulatory developments daily. Some are even tracking developments on an hourly basis.

The new normal is anything but

The report suggests that while tariff mitigation strategies vary, a few shared priorities are emerging. Chief among them is improving access to timely, reliable data. From shipment tracking to landed cost calculations, companies are seeking better ways to quantify risk and make decisions quickly.

Second is breaking down silos. Effective tariff response requires collaboration between tax, legal, logistics, sales and the C-suite. That cross-functional effort must be underpinned by clear governance and ongoing education to keep pace with regulatory change.

Finally, businesses are looking to convert compliance from a defensive function into a competitive asset. That means not just surviving tariffs but using them as a catalyst for smarter procurement, more localised sourcing, and better end-to-end control.

For many, the next challenge is already here. President Trump’s announcement of sweeping new tariffs on 2 April, and their partial suspension just a week later, underscores just how fast the ground can shift.

Survive/adapt/repeat

The Thomson Reuters report finds that 79% of companies plan to increase tariff risk mitigation activity in 2025. This includes everything from improved data pipelines and AI-driven classification to integrated trade compliance tools.

With 90% of companies expecting tariffs to remain elevated or increase, the margin for delay is narrowing. More than half say they have already absorbed costs or passed them on to customers. Others are now exploring how automation and trade analytics can create space for reinvestment.

Ultimately, the companies that thrive will be those that build for adaptability, not just for efficiency. Tariff turbulence is no longer a short-term storm to ride out, but a defining feature of the landscape. Those that learn to navigate it rather than wait for calmer waters will be better placed to protect margins, retain supply chain resilience, and turn compliance into a competitive edge.