Policy proposals floated in a changing landscape for the United States could have far-reaching effects, especially on import tariffs into the U.S. Are exporters—particularly in Mexico and China—looking at increased trade tariffs of up to 35 percent?

In order for the new administration to offset a potential reduction in the corporate tax rate, they will have to consider all vehicles for acquiring revenue, especially those that would facilitate a move in the direction of turning the U. S. to a net exporter, according to an analyst with Integration Point. “We are so active within many trade organizations working with lawmakers to determine the next course of action,” said Joe Passalaqua, Integration Point Manager-Senior Accounts, “We are also positioning ourselves to have solutions ready for our client base as the tides change across the international trade community.”


Circumstances to Consider

Passalaqua recommends that organizations ask themselves three questions:

  • Do you have plans in place to reduce supply risk from at-risk countries?
  • Can your supply chain and supply chain partners respond proactively and work with you in what could be a period of uncertain markets?
  • Can your sourcing organization work quickly with new tariff policies? Do you have the capacity within your group? And, more importantly, do you have the necessary bandwidth?


Possible Results

Potential impacts on supply chains could mean increased prices on purchased goods and raw materials, higher interest rates and on Total Cost of Ownership—supply disruption and a boost in costs for logistics and warehousing costs.

  • Increasing costs of U.S. exports into world markets–with a potential adverse impact on sales by organizations.
  • Potentially more “buying power” for the U.S. corporation for offshore goods and services normally priced in local currencies, and the possible impact offset by imposed tariffs on goods as they enter the marketplace.


Strategic Planning

The future will not be an exercise of “picking the apparent low price supplier.” Summary planning, risk evaluation and management and hardline strategic sourcing and negotiations will be key for success should tariffs rise.

Most companies do not have the tools to get ahead of the curve as they assist clients in many industries on a changed process journey. Success will require insight, foresight and a commitment to transformational change from the very top.

The Integration Point Supply Chain Compliance solution not only provides organizations the ability to validate the security of their supply chain, but also improves supply chain visibility.


The Solution

Companies will also need to find the most cost-efficient sourcing for products and raw materials. This requires a full assessment of costs including duty rates and rules of eligibility for preferential treatment. Navigating assessments manually can take days--and once information is collected, analyzed and shared, it could already be out-of-date.

Integration Point Tariff Analyzer allows your business to view and compare main/preferential duty rates, future rates and rules of origin as well as available free trade agreements, anti-dumping duty rates, HS numbers by Country of Destination and sample certificates and details of trade agreements.


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