How will the new Trump tariff policies affect my company's landed costs?

The specific impact depends on your sourcing geography and product categories. Companies importing from China, Mexico, and other key trading partners face increased duties on raw materials and finished goods. KPMG analysis suggests supply chain teams should model various tariff scenarios to understand cost exposure by product line and implement dynamic pricing strategies accordingly.

What sourcing strategies should we prioritize under the new tariff regime?

KPMG's assessment indicates companies should consider supplier diversification across tariff-advantaged jurisdictions, nearshoring to Mexico or Canada, and domestic sourcing where feasible. Tariff-avoidance strategies may include country-of-origin optimization and supply chain reconfiguration to minimize duty exposure.

How much lead time should we add to inventory planning?

The tariff environment introduces uncertainty into supply planning. Companies should evaluate buffer stock strategies and lead time adjustments based on their exposure to tariffed categories. KPMG analysis suggests building flexibility into procurement calendars to accommodate potential policy changes and customs processing delays.

Are there trade agreement benefits that can mitigate tariff impacts?

Programs like USMCA, trade preferences for certain countries, and duty drawback provisions may offer cost mitigation. Supply chain teams should work with trade compliance experts to ensure proper documentation and classification to maximize available tariff benefits.

What timeline should we use for supply chain restructuring?

KPMG's analysis frames tariffs as a structural, long-term shift rather than a temporary measure. Supply chain professionals should develop multi-phase restructuring plans with immediate compliance actions (tariff classification reviews, supplier cost modeling) and medium-term strategic initiatives (nearshoring, supplier consolidation, alternative sourcing).

Trade Policy & Tariffs

High Impact

Trump Tariff Policy: Supply Chain Impact & Strategic Response

May 15, 2026

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The signal

The Trump administration's tariff policy represents a significant structural shift in the trade environment, affecting companies across multiple sectors and geographies. KPMG's analysis examines how new tariff measures will reshape sourcing decisions, increase landed costs, and require supply chain professionals to reassess supplier diversification and inventory strategies.

This development carries high impact due to its scale (affecting global trade flows), severity (forcing material cost increases and operational redesigns), and duration (tariffs create long-term structural changes rather than temporary disruptions). The tariff landscape creates both immediate compliance challenges and longer-term strategic questions about supplier location, production reshoring, and alternative trade routes.

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Frequently Asked Questions

What This Means for Your Supply Chain

Simulation Suggestion

immediate

What if average tariff rates on imports increase by 15-25%?

Model the impact of elevated tariff rates on key sourcing countries. Adjust landed cost assumptions for products currently imported from China, Vietnam, and India. Recalculate total cost of ownership including duties, and identify which product categories experience the highest cost inflation.

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Simulation Suggestion

this month

What if we shift 30% of sourcing from Asia to Mexico or North America?

Simulate a nearshoring strategy where 30% of current Asian imports are repositioned to Mexico, Canada, or U.S.-based suppliers. Model the trade-offs between lower tariff exposure, higher unit costs, extended lead times for capacity ramp-up, and inventory adjustments during transition.

Run this scenario

Simulation Suggestion

this week

What if customs processing times extend by 5-7 business days due to tariff verification?

Model the inventory and cash flow implications of delayed customs clearance. Increase import lead times by 5-7 days due to enhanced tariff documentation requirements and border processing. Evaluate the need for safety stock buffers and expedited freight alternatives.

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Go deeper:

Supply Chain Digital Twin: The 2026 Guide

How operators model end-to-end supply chains to see how tariffs, supplier shocks, and regulatory changes ripple across cost, service, risk, and time.

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