Recent US government decisions have resulted in global volatility and challenges for US manufacturers, in particular. The following is a summary of a blog from Epicor’s Andrew Robling, Principal Product Marketing Manager relating to tariffs, but provides lessons for Australian manufacturers:
Tariffs are more than political rhetoric – they significantly impact manufacturing by raising costs, disrupting supply chains, and creating uncertainty. These pressures are forcing manufacturers to rethink their strategies to remain competitive and profitable. Companies that adapt quickly can turn these challenges into opportunities, while those that don’t risk falling behind.
A real-world example comes from a plant manager who shared that his company is urgently seeking alternative sources for materials like aluminium, steel, and elastomers. They’re exploring both domestic and international suppliers to reduce tariff exposure and maintain supply chain stability.
This scenario reflects a broader industry trend. Manufacturers are reassessing their supply chains, shifting production to countries with favourable trade agreements, and investing in automation to offset rising costs. Larger firms are even acquiring suppliers to gain more control over pricing and availability.
Enterprise Resource Planning (ERP) software is playing a crucial role in this transition. These systems help companies analyse supplier costs, evaluate sourcing alternatives, and optimize procurement strategies. ERP tools also provide real-time cost visibility and support automation, which boosts efficiency and reduces waste.
Despite these efforts, tariffs still pose significant challenges. Increased raw material costs often lead to higher prices for finished goods, which can hurt competitiveness. Some companies absorb the costs, squeezing margins, while others pass them on to consumers, risking reduced demand. In extreme cases, businesses may cut jobs or delay investments.
Governments are responding with support measures like tax credits, subsidies, and incentives for domestic production. These initiatives aim to help manufacturers build more resilient supply chains.
Ultimately, navigating tariffs requires long-term strategic thinking. Companies that diversify suppliers, invest in technology, and remain flexible are better positioned to thrive. As one plant manager put it, success depends on being proactive—not reactive—in a constantly evolving global trade environment.
Full blog can be found here .