The Pressure Just Ramped Up: Is Your Business Ready?
Tariffs, slower payments, and rising costs aren’t coming—they’re here. This is how to respond before it’s too late.
With the latest round of tariffs now in effect—on everything from electric vehicles to solar panels—it’s clear that the trade war is no longer a talking point. It’s policy. And the ripple effects are already starting to hit U.S. businesses.
Costs are expected to rise, especially for companies importing parts or finished goods from China. If you're a manufacturer or in distribution, your landed cost just went up. If you're in retail, your pricing power may go down. And if you sell B2B, your customers may already be slowing payments to preserve their own cash flow.
Margins are likely to tighten—not overnight, but steadily—as the impact moves through the supply chain. Business owners who wait for this to show up in their P&L will be too late. Especially if they don’t have a trusted expert (not just a tax accountant) helping them read between the lines—and act before the damage becomes visible.
The ones who get ahead of it will start now: analyzing exposure, protecting cash, and adjusting strategy before the pressure builds.
Here’s where to begin.
Start with Supply Chain Reality Checks
Do you actually know your supply chain? Not just your vendor—but their vendors, shipping dependencies, seasonal delays, geopolitical risks. If your answer is “we order from a big distributor,” that’s not analysis—that’s hope. And hope is not a strategy.
Run a supply chain audit. What materials are critical to delivering your product or service? What’s the lead time if something goes sideways? What’s your backup plan? If you don’t have one, now is the time.
And if you’re in a service business and think this doesn’t apply—think again. Your supply chain might be software, talent, or subcontractors. Same rule applies: know your dependencies, and know your exposure.
Analyze Your Customer Base: B2B vs. B2CS
Your customer’s stress becomes your stress.
If you sell B2B, are your clients funded? Profitable? Dependent on credit-sensitive sectors? If they’re getting squeezed, you will too—usually through slower pay, smaller orders, or cancelled projects.
If you sell B2C, are you tracking shifts in consumer behavior? Are you a must-have or a nice-to-have? That difference matters—especially when wallets tighten.
No matter your market, it’s time to dig deeper than top-line sales. What’s your retention rate? What’s your customer acquisition cost lately? Has it gone up? And what’s your break-even point—has it changed now that costs are climbing?
Watch Your Receivables Like a Hawk
Sales don’t matter if the cash never shows up.
Now’s the time to monitor your A/R aging and your DSO (Days Sales Outstanding) like they’re your lifeline—because they are. If your DSO is stretching, your customers are using you as their bank. That might’ve been tolerable when money was cheap. It’s not anymore.
Make follow-ups tighter. Revisit terms. Offer early-pay discounts if it helps your cash position. Hold the line with habitual late-payers. Your margin doesn’t mean much if your cash is stuck in limbo.
Revisit Your Pricing Model
You can’t cut your way to growth—but you can price your way to death. Pricing isn’t just about what your competitors are doing or what your gut says. It’s about margin analysis, cost structure, and value perception.
If you haven’t re-run your pricing model since before this round of tariffs hit, you’re probably undercharging. At the very least, tier your services or products. Give customers choices—just make sure one of those choices keeps you profitable.
Rethink Your Workforce: Who’s Critical, Who’s Not?
Labor is your biggest cost—so treat it like a strategy, not a sunk expense. Start by asking: who’s mission-critical? Who drives revenue? Who keeps operations humming? Everyone else is worth a second look.
Can that role go fractional? Can it be outsourced or automated? Are you carrying legacy staff or inflated titles from when things were busier?
This isn’t about cuts for the sake of cuts. It’s about right-sizing your team for this economy—not the one you planned for two years ago.
Cut Smarter, Not Deeper
There’s a difference between trimming fat and cutting muscle. Too many businesses go straight to layoffs or slash marketing—ironically, two areas that can kill growth long-term.
Instead, look for inefficiencies: outdated systems, overlapping software, manual processes that should have been automated years ago. And yes, do a headcount review—but through the lens of productivity, not just payroll.
Invest in Optionality
Optionality is your buffer. Your safety net. Your get-out-of-jail-free card.
Flex space instead of long leases.
Contractors you can scale up or down.
Multiple vendors instead of single-source dependency.
A banker who knows your name—and answers your call.
Optionality isn’t always the cheapest route—but it keeps you in the game when things change fast.
A Few More Moves the Savvy Are Making
Stress-Test Your Financials: What happens if revenue drops 20%? What if one of your major customers doesn’t pay? Run those models now—while you still have time to adjust.
Double Down on Your Core Offering: Now is not the time to be everything to everyone. Refocus. Simplify. Nail what you’re already good at—and let the distractions go.
Lock in Long-Term Contracts: If your customers are still buying, get them into longer agreements now. Predictable revenue is gold during uncertainty.
Revisit Capital Projects: If you're still greenlighting new initiatives, run a hard ROI analysis. If it doesn’t improve margin or cash flow, it goes on hold.
Final Word
This isn’t a downturn you can ride out with optimism and inertia. This one requires strategy, clarity, and the courage to move before you’re forced to.
That’s what we do at Bespoke Business Advisory. We help companies see around corners, spot weaknesses before they become problems, and build a real path to profitability—even in a shifting economy.
If you’re ready for clear answers, hard truths, and a strategic plan that actually moves the needle—let’s talk. We only take on a limited number of clients. If there’s a fit, we’ll tell you. And if there’s not, we’ll point you in the right direction.