Turmoil: Unlock the global sourcing strategies required beat tariffs, reduce risk and building competitive advantage in 2025’s shifting sourcing and procurement market.
The global economic, trading and sourcing landscape in 2025 is marked by heightened uncertainty stemming from geopolitical instability, trade policy changes, inflationary pressures, and an increasingly cautious consumer sentiment. While these challenges pose risks to company stability as supply side cost builds and demand softens in many markets. For many they can also create unique opportunities for companies to adapt and grow by rapidly building competitive advantage. Businesses that proactively adjust their global sourcing strategies can thrive even in turbulent times by focusing on resilience, sourcing opportunities and rapid development of new sourcing supply partners in emerging markets
Tariff turmoil driving economic and sourcing instability
1. Geopolitical Instability in trade and sourcing:
- Heightened geopolitical tensions—such as trade disputes between major economies and regional conflicts—are disrupting global supply chains and increasing market volatility.
- Companies face risks related to tariffs, sanctions, and sudden policy changes that impact sourcing and distribution.
- The stop start nature of the changes in tariff and an apparent lack of strategy in their execution is creating huge uncertainty. Stopping effective planning and global sourcing strategies being created and delivered.
2. Inflationary Pressures in the global economy:
- Tariff policy driven by the US, is having an immediate impact in global sourcing and procurement decision making.
- The OECD were already projecting a downwards effect on global economic growth for the year ahead, before we saw the full extent and execution of the US tariff plans.
- Building inflationary pressures and impacting consumer confidence and spending. Rapidly forcing businesses to rethink pricing strategies to maintain profitability.
- Rising input costs are squeezing margins, particularly for companies reliant on imported goods or raw materials.
3. Demand Volatility driven by stop start policy:
- Consumer behaviour has become increasingly unpredictable due to economic uncertainty. Reduced confidence in developed markets is leading to slower demand growth.
- Emerging markets offer pockets of optimism but require tailored strategies to capitalize on their potential.
4. Trade Policy Shifts:
- Changes in trade regulations and protectionist policies are reshaping global commerce. Tariff policy is making trade between sourcing countries impossible. US businesses must navigate new tariff policies to maintain input costs.
ET2C International global sourcing experts
ET2C International are a British owned global sourcing company with over 23 years experience working with our international clients to make their sourcing simple. Our 200 colleagues are based in 7 global offices in developed and lower tariff sourcing markets to deliver rapid and insightful access to manufacturing potential partners.
- China
- India
- Vietnam
- Turkey
We work with many clients to create and execute global sourcing strategies to mitigate tariffs and build competitive advantage.
- Rapid market insight into new sourcing markets
- Supplier identification and audit
- Quality and compliance management
- Unique Buying office model implementation
To learn more about how we can partner with you to rapidly build margin, reduce tariff costs and create simplicity drop us a line at contact@et2cint.com
Growth opportunities delivered by effective Global Sourcing Strategies
To navigate uncertainty while pursuing growth opportunities, companies must adapt their global sourcing strategies. The reliance on long supply chains was tested severely during the Covid pandemic. Lesson learnt during this time can be applied to the current global sourcing and procurement environment.
Many companies endeavoured to reduce risk in their global supply chains by creating a delivering an effective product sourcing strategy focused on resilience and risk management. Competitive advantage will be built by the companies that build a clear strategic sourcing plan and execute with pace and effectiveness.
1. Diversify global sourcing markets
Reliance on single sourcing regions or suppliers increases vulnerability during disruptions such as geopolitical conflicts or trade policy changes.
Rapidly identifying and building knowledge of low tariff sourcing markets is vital to building an effective lower tariff supply chain.
For companies outside the US the freed up capacity in China as US companies move out to avoid tariffs can provide great opportunities to secure product volume at improved pricing.
2. Strengthen Supplier Relationships
Long-term partnerships with reliable suppliers provide stability during disruptions. Companies should regularly assess supplier portfolios based on financial health, operational capabilities, and alignment with sustainability goals. Building a long term partnership for growth rather than a transactional order fulfilment relationship. A deeper relationship embeds strategic suppliers embling a joint approach to supply and demand headwind
4. Nearshoring and Onshoring
Relocating production closer to key markets reduces logistical complexities while improving responsiveness to regulatory changes. This approach is very much a product specific initiative. Many categories such as apparel have such strong manufacturing facilities in Asia that product costs are not achievable manufacturing in US EU or UK.
In addition, the planning time and capital required to establish new manufacturing facilities make project sign off extremely challenging in a highly volatile global sourcing and trading environment. It can be considered but only where the best benefit analysis is overwhelming.
Strategic Imperatives for global sourcing and procurement teams
To thrive during economic uncertainty, companies must adopt a proactive mindset focused on resilience-building, sustainability prioritization, and agility. Final strategic initiatives will be focused on whether the company is inside the US or outside.
US companies:
- Focus on rapid supply chain diversification to mitigate impact of global sourcing tariffs and the stop start implementation.
- Start to build knowledge of potential suppliers in lower tariff markets such as India and Turkey. Both countries have consistently enjoyed some of the lowest tariffs in all the communications from the US
Non US companies:
Identify opportunities to work with companies who have lost volume as US companies depart China or consumer demand lowers requirements
Conclusion:
Economic uncertainty presents significant challenges but also opens doors for innovation, strategic expansion, and operational improvements.
Adopting resilient global sourcing strategies—such as diversifying supply chains, strengthening supplier relationships, nearshoring production facilities, will enable businesses to mitigate risks while remaining agile in response to market shifts.
Ultimately, companies that embrace adaptability while prioritizing resilience will be well-positioned not only to survive but thrive amid the complexities of today’s economic environment.
