As the 2024 presidential election approaches, trade policies and tariffs are shaping up to be key issues that could significantly impact supply chains and business costs. In light of this week’s presidential announcement where Biden called for increased China tariffs, knowing how to navigate these pitfalls by implementing diversification and contingency plans is key.

Jim Pratt, Managing Partner at supply chain consultancy Forsyth Advisors, has been at the forefront of helping companies navigate turbulent tariff waters for over a decade. “We’ve been through administrations that took a hardline stance on tariffs before, like the Trump era,” states Pratt. “Inflationary pressures make it even more critical now for companies to have flexible supply chain strategies that can absorb potential tariff shocks.”

Pratt’s experience guides his recommendation that organizations should spread their risk through multi-country sourcing strategies. “The more you have that contingency planning in place, the better prepared you’ll be for disruptive events—especially likely ones like increasing China tariffs if certain candidates take office.”

While the Biden administration has maintained many of the elevated tariffs on Chinese imports, the rhetoric from candidates like Trump points to an even more aggressive posture, with threats of tariffs potentially exceeding 60% on all Chinese goods“The likelihood of Trump returning and tariffs going up is very high,” cautions Pratt. “With Biden, they’ll unlikely go away but will likely stay at the status quo levels.”

Regulatory actions beyond just tariffs also loom, such as restrictions targeting forced labor or intellectual property concerns. “In some ways, those focused regulations can be even scarier, as the impact is narrower but deeper for affected companies and industries,” explains Pratt.

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