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Approaching Your Supply Chain Strategy Amidst Tariffs, Uncertainty, and Growth
Learn how to develop strategic, resilient supply chain strategies amidst economic growth, uncertainty, and tariffs.
ITR Economics
Nov 5, 2025
At an industry event recently, we were invited to join a panel on developing supply chain strategy in the second half of the decade. The other members of the panel included industry leaders who had developed dynamic and resilient supply chain strategies. The knowledge and experience that was shared during the conversation is certainly worth revisiting.
This Growth Phase Will Be Different
US Industrial Production is expanding, and ITR Economics’ forecast calls for further production growth in 2026 and the coming years. This growth environment will be different from the one we experienced coming out of the pandemic, which was a sugar rush type of growth in 2022 and 2023, followed by a sugar rush hangover throughout the slower 2024.
The rise in the industrial sector in 2026 and beyond will be accompanied by a more volatile business environment, geopolitical uncertainty, economic policy uncertainty, and continuation of tariff-related pricing pressures. In such an environment, having an iron grip on your supply chain can make all the difference.
3 Keys to Supply Chain Resilience
Adaptability
Adaptability means being proactive in developing diversified supplier sourcing. ITR Economics has been working with clients who are exposed to China to develop a “China + 1 + 1” strategy. China offers a lot of value, but businesses should not overleverage the China option.
Business leaders must be proactive, not reactive. Being reactive, as we all learned during the pandemic, can get expensive. A USA-centric approach that can quickly adapt to shifting geopolitical disruptions is no longer a luxury, it is a necessity.
Cost Efficiency
ITR Economics’ forecast is for rising inflation to accompany the economic growth of the second half of the decade. We can call this period the battle of the margins.
Supply chain strategy must include a focus on reducing inefficiencies to improve margins. Recently the Wall Street Journal featured how Sharpie has been able to onshore production into their Tennessee plant, quadruple their output through automation in a five-year period, retained their employees via training and skill development, and continue to deliver their high quality product in less time to their customers. Through all this, Sharpie has maintained the price of their pen in stores since 2020.
Sharpie cut costs through onshoring, automation, efficiency gains, and shortening their supply chains. By doing so, Sharpie achieved faster delivery combined with a higher quality product, resulting in strong customer satisfaction and loyalty. Competitive advantages will be critical for margin protection in the coming years.
Move From Transactional to Strategic Partnership
Through an audit, identify how many of your inputs are heavily leveraged by a single or limited number of customers. Understanding your liability allows you to approach your customers, communicate the risk to them, and mitigate the risk of overbuilt inventory that is hard to move if the demand needs of those customers shift suddenly. Intentional collaboration around risk mitigation can turn customer and supplier relationships from a simple transactional one to a strategic partnership.
The Heart of It All Is Supply Chain Realignment
The above three can all be boiled down to supply chain realignment.
To build out your supply chain realignment strategy:
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- Assess your current supply chain
- Leverage data and technology to deliver optimized insights and to make better decisions
- Diversify your sourcing and nearshore for tariff optimization
- Improve supplier relationships by making them collaborative and not purely transactional
This can be quite the undertaking, but we are always happy to help. Resilience and proactive planning are key to successful supply chain management — being reactive is an expensive strategy.