Does your business have a tariff resistant strategy? Abraham Lincoln said:
“I am in favor of a national bank…in favor of the internal improvements system and a high protective tariff. “
Many of us are not in agreement on tariffs and trade wars. Yes, they hurt us as business owners. However, we do not have control over what is currently happening in global trade. We do have control over how we align our business to grow in a tough situation. So I ask again, does your business have a tariff resistant strategy?
A movement began in the late 1800s. This movement was the “Buy at Home” campaign, encouraging the community to keep their money within their local community. Today, it is the “Buy Local” movement. What does this mean, and how is this a response to the tariffs?
Tariff Impact
Time will tell what benefits tariffs will bring. As of today, according to Investopedia and Forbes, at least 75 countries have reached out to negotiate a trade deal to rebalance global trade. In the meantime, what can we, as business owners, do to keep our businesses going and growing? You need a tariff resistant strategy. A tariff resistant strategy is an approach you adopt to minimize the financial, operational, and competitive impacts of tariffs-taxes imposed on imported goods-on their operations, supply chains, and profitability. The goal is to build resilience against tariff fluctuations and maintain business viability regardless of changes in trade policy. Here are some comprehensive ways to build your strategy.
Build Your Strategy
Consider Campaigns and Alliances. Be a member of an organization that is niche-specific to your type of business. For example, the Business Industry Association (BIA) would be a great place to get with other construction business owners if you are in construction.
Create marketing campaigns to educate the community on the advantages of working locally and with your local chambers of commerce. They host events designed to market and educate the public about local businesses in their area.
Reducing your COGS over many units can definitely improve your profitability. It will definitely take time but start looking for multiple streams of suppliers that can provide you with what you need at the best price possible.
Be visible. Many of us rely on referrals. This is great; however, in this type of economy, a business needs all the exposure to the general public. Social media campaigns are great; however, getting involved in a service club allows you to contribute to your community and gives you exposure, letting everyone know who you are. When I was in sales, we called it “Belly to Belly” marketing. This brings us to the final strategy, branding.
Do you have a branding program for your business? It is more than having a logo on your business card. Signate on your vehicles. When at a job site, do you have a sign displaying your company name, logo, and mission statement? Out of sight is out of mind. Be visible.
We’ve guided business owners like you from financial confusion to running profitable businesses through smart budgeting and comparing to actual business activity. If this interests you, click HERE to set up a friendly chat with us and be inspired by the success stories of businesses we’ve helped.
There is Power in the Penny
Have you ever heard the saying, “There is Power in the Penny”? There is a significant impact that small actions, contributions, or savings can have when accumulated over time. Though a single penny seems almost worthless on its own, consistently saving, investing, or contributing even the smallest amounts can lead to meaningful results. You can do this by placing value and not overlook small savings or efficiencies, because they add up. Small, consistent efforts-whether financial or otherwise-can create momentum and lead to substantial achievements. Start making wiser decisions with even the smallest resources, knowing that every bit counts toward a larger goal. For example, in budgeting or project management, tracking every penny can help control costs and improve profitability. In personal finance, regularly saving pennies can eventually grow into significant wealth. The phrase ultimately underscores the principle that small things, when multiplied or compounded, can have great power and influence.
Are Tariffs a Black Swan?
This trade war is a Black Swan event, as defined by Nassim Nicholas Taleb and widely adopted in finance and economics, has three key attributes: it is an outlier (rare and unpredictable), it has an extreme impact, and, in hindsight, people try to rationalize it as if it could have been expected But within every Black Swan, there are opportunities. All you have to do is look for them. Now is the time to take advantage of domestic suppliers and exploring new market opportunities. Do not wait until it is too late to get ahead.
Remember, you don’t have to go at it alone in your business (and you shouldn’t). So, don’t hesitate to reach out if you need some guidance on whether this is right for you and your business. We’re here to help you build something great and long lasting. If you would like to read more on growing in these tough economic times, click HERE.