Tariffs, Manufacturing and Capitalizing on Opportunities

Tariffs are shaking up supply chains, and manufacturers and distributors, facing the threat of a trade war, must rethink their processes and operations.

According to a survey by advisory and accounting firm Aprio, almost a quarter of companies (23 percent) import more than half of their components. The U.S. National Manufacturing & Distribution Study also found that nearly a third spend US$1 million or more on customs duties and tariffs. “At the same time, manufacturers and distributors are open to switching to domestic suppliers; most have reshored at least some components and materials in the past year,” the report states.

“Manufacturers and distributors are grappling with unprecedented challenges, yet the latest iteration of (Aprio’s study) reveals significant opportunities to automate processes and adopt supply chain best practices,” Adam Beckerman, manufacturing and distribution leader at Aprio, said in a press release. “These improvements can drive more efficient reporting and production — ultimately enabling growth and positioning businesses to win in a complex global trade environment.”

Among the opportunities, according to the survey, are:

• Increasing supplier collaboration through partnerships and forecast-sharing
• Expanding supplier audits, including of quality, financial stability and compliance, to help mitigate disruption and avoid regulatory issues
• Considering reshoring possibilities
• Sourcing regionally.

Other opportunities can enhance cost-saving, productivity gains and efficiency — also critical concerns in today’s manufacturing environment. According to the report, however, manufacturers and distributors are slow to implement such best practices as predictive maintenance, energy efficiency measures, improving inventory management and skills training.

The Aprio study, which was conducted in December by global research firm MPI Group, received 227 responses from executives at companies in more than 20 industries.

Digitalization is still making its way into the food and beverages (F&B) industry. According to new research, seven in 10 companies (69 percent) still rely on manual processes, while only 6 percent have “fully integrated” digital solutions.

However, six in 10 say they are ready to consider new solutions if they could be implemented in weeks rather than months, the research, by TraceGains, provider of compliance, quality, and innovation solutions for the F&B industry, found. And 82 percent of companies say implementing new technology is a top business priority.

“The clock is ticking for food and beverage brands plagued by outdated ERP software and slow-moving consulting models that no longer serve the needs of today’s market,” Paul Bradley, TraceGains’ senior director of product marketing, said in a press release. “Our latest research confirms a shifting mindset from outdated playbooks to modern solutions capable of delivering impact right away and deployed in weeks, not months.”

Among other findings:

• The broader economy is a top concern among 62 percent of survey respondents
• About a quarter (24 percent) would fast track a new tech purchase within 90 days for compliance reasons or if required to meet a mandate
• Twenty-nine percent say “their current operational management methods are inadequate and inefficient, causing significant internal challenges,” according to the press release
• Improving process efficiency and ease and speed of implementation are top dynamics driving tech adoption decisions for 57 percent of respondents.

(Photo credit: Getty Images/Hxdbzxy)