Navigating Supply Chain Disruption in the Face of New Tariffs
The trade landscape is shifting once again. With the Trump administration back in office following the November 5 election, proposed tariffs of 60% on Chinese imports and 10-20% on imports from the rest of the world have reintroduced uncertainty into the footwear and apparel industries. While the political path for U.S. trade policy may feel clearer, its effects on your business likely feel anything but.
At Zefyr Solutions, we’ve been closely tracking the evolution of these changes. In June 2024, we covered the Security Fairness Act on our blog, followed by an October analysis of the Biden Administration’s Executive Order on Section 321. These policies, paired with the return of a tariff-heavy trade strategy under Trump, leave many companies questioning what comes next.
The reality is that most businesses will feel these changes in one way or another. Take Steve Madden, for example—CEO Edward Rosenfeld recently announced plans to cut imports from China by 40-45% over the next year to reduce tariff exposure. Even if your reliance on foreign materials isn’t as high, now is the time to evaluate your supply chain strategy. The good news? There are actionable ways to navigate these challenges, and you don’t have to go it alone.
A Strategy for Success
In times of uncertainty, preparation is the key to resilience. Zefyr Solutions specializes in helping companies respond strategically to shifting trade policies. Our team works alongside yours to assess impacts, uncover opportunities, and build a supply chain strategy that strengthens your operations. Here are a few ways we can help:
1. Financial Impact Assessment
With tariffs looming, it’s crucial to understand exactly how your costs will be affected. Our detailed financial models help you identify the pressure points across your product range, giving you the insights needed to plan effectively.
2. Risk Assessment and Supply Chain Mapping
Where are your current supply chain vulnerabilities? Are there dependencies on certain suppliers or routes that could become problematic? Our team identifies risks to ensure your operations stay resilient. This includes examining regulatory and compliance hurdles, especially as Section 321 rules and customs bottlenecks evolve.
3. Strategic Sourcing Opportunities
Diversifying your supply chain is one of the most effective ways to minimize tariff exposure. We’ll work with you to explore:
● Alternative Suppliers: Evaluate new vendors outside China, factoring in cost, capacity, lead time, and quality impacts across your brand.
● Dual-Sourcing Strategies: Balance risks and costs with a phased diversification approach. This gradual strategy allows your team to adjust without feeling overwhelmed, setting your company up for long-term success.
Why Now Is the Time to Act
The footwear and apparel industries are no strangers to global disruption. However, the current trade climate demands a new level of agility. As we like to say, “Skate to where the puck is going, not where it has been.”
Even the most experienced teams can benefit from external support during times of change. Whether you’re seeking supply chain traceability expertise or need to explore new sourcing options to cut costs, Zefyr Solutions is here to guide you. We’ve worked with major brands, customs agencies, and technology providers to help businesses navigate everything from origin to retail.
Learn more about service offerings here. Or, book a call with our knowledgeable team today. Together, we’ll build a strategy that works for your business.