Tariff Cut Announcements and Other Changes that Could Impact Your Supply Chain

May 14, 2025

 

 

Guess what?

With this week’s announcement that the U.S. and China are reducing their tariffs dramatically, the “Tariffying” world has changed yet again. The U.S. is dropping the tariff on China from 145% to 10% while keeping a separate 20% tariff related to fentanyl in place, which brings the total up to 30% for most Chinese imports. The retaliatory duties from China have been lowered from 125% to 10%. These cuts will last for 90 days while negotiations continue.
 
Last week we hosted a webcast with our friends from the National Industrial Transportation League and CSCMP that provided a picture of the tariff landscape and offered tips for managing all the changes. It got rave reviews with several attendees letting us know that it was the best webcast on tariffs that they had viewed. 
 
Frankly, I wasn’t surprised because our panelists from Thompson Hine, Karyn Booth and Dan Ujczo, did a great job talking about the China ship fees and different considerations. And John Janson talked about how SanMar, a very large and outstanding apparel company, is handling the situation. 
 
If you already know all you need to know about tariffs, there is no need to watch the replay of this webcast. But if you realize that you have to protect your company since the tariff issue is one of the most important issues affecting your company’s financial health, then definitely watch the recording to learn more about what is really happening.
 
One lesson coming out of the webinar was the need for companies to have a written Tariff Management Plan that addresses the financial and supply chain implications resulting from tariffs. If your company doesn’t have a written tariff management plan, you are playing with dynamite! We don’t want to see that happen so CALL TRANZACT and learn more about how we can help you quantify the cost of these tariffs based on the changes that are occurring and understand the broader financial outcomes.
 
The call won’t cost you a dime but it will help you understand how TranzAct can shed light on some important issues such as:

  • How will these changes impact your cash flow?
  • Should your inventory strategy change from "just in time" to "just in case"?
  • What actions should your company be taking to mitigate the tariff issues?
  • How can the use of bonded warehouses, Foreign Trade Zones or changes to Incoterms help your company?

There are several other very important questions to consider. But if your company needs to learn more or do something right away, no worries. TranzAct has a team that is available to help you figure out how these changes can affect your supply chain and what options look best. To get in touch, just give us a call at 630-833-0890 or send me an email.
 
Before signing off, we need to once again focus on some important LTL and parcel issues. Is your company ready for LTL freight classification changes taking effect in July? That is when the NMFTA will change the freight classification for several items as the first phase of its overhaul to this system. TranzAct can help you identify how your freight will be affected and develop strategies to mitigate increases. We have a team of experts who know this area well. Just give us a call or schedule a time to meet so we can walk you through what's ahead.
 
On the parcel front, UPS and FedEx have issued some new pricing changes and chances are you’re not going to like them. For example, UPS wants to charge you a 2% payment processing fee. That’s right. You can soon pay them 2% more to simply pay your bills.
 
But there’s more, such as the addition of approximately 3000 more zip codes that will now fall into the “extended coverage” category for both FedEx and UPS starting June 2! And that is why you need to heed the advice from our friend Jerry Hempstead: Everything is negotiable! You need to have the data and experience to know how to do those negotiations. If you do it the right way your company may be looking at double digit savings! Once again, TranzAct can help you here.
 
Add it all up and now is a great time to reach out for support.

 

BY MIKE REGAN, CO-FOUNDER OF TRANZACT

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