Trump tariffs and manufacturers.
Let’s give a shout-out to any supply chain, pricing, and accounting professional in manufacturing this week. As of April 2nd, if your company makes a physical product that relies on any imported material, you’re likely working on costs and pricing.
After Trump’s announcement of a 10% blanket tariff on all trading partners— and even higher tariffs from countries like China (gulp 84%!!)— chances are if you’re one of the professionals mentioned above, you’ve been digging into landed costs and the resulting need for price increases.
Update (not the good kind): As of last Friday May 16, Trump announced a departure from the 10% blanket tariffs instead stating he will notify 150 countries of updated tariff rates.
But wait, there’s more:
Instead of the usual painstaking trade negotiations, the U.S. will now just…send letters. That’s right. Hundreds of countries are about to get the economic equivalent of a “You up?” text from the White House.
And as of yesterday, those notifications will only be sent to nations who don’t negotiate in “good faith” letting them know their tariffs will return to their previous April 2 rates (what Forbes referred to as “flip-flop no. 17”).
Deep breaths.
Meanwhile, Canada has since dropped retaliatory tariffs on a lot of goods.
Regardless, the latest on Trump tariffs continue to cause dramatic financial pressure across the supply chain. This directly affects pricing—particularly for mid-market manufacturers already operating with lean margins.
With the unpredictability of these tariffs, some of the cost of goods aren’t realized until they’re in port, and it’s a risk many companies can’t take.
Financial Impact of Trump Tariffs on Manufacturers
Many of our manufacturing clients are feeling the brunt of Trump’s tariffs. Here are the most common areas we see impacted:
Margin Shrinkage & Pricing Challenges
With an increased cost of goods sold (COGS), many are feeling the margin compression on their products and as result are having to grapple with whether to raise prices right away or wait it out.
Budgeting, Forecast & Analysis Complications
Sudden increases in COGS are having an immediate impact on budget variance, forecasting and profitability analysis. This is further complicated if your reporting and ERP are not properly configured.
Supply Chain and Vendor Diversification Needs
With even Apple’s supply chain affected, mid-size companies are no exemption from the volatile effect Trump’s tariffs have put on the global supply chain.
If it’s any consolation, you aren’t alone. Fifty-one percent of SMBs polled by CNBC said that they expect changes in trade policy to have a negative effect on their business and nearly 60% are concerned tariffs will harm their business over the next year.
Key U.S. Trading Partners and Trump Tariffs Impact on Manufacturing
What Is Landed Cost — and Why It’s More Critical Than Ever
Landed cost is the total expense it takes to get a product from your supplier to its final destination—whether that’s your warehouse or a customer’s doorstep. It includes everything beyond just the purchase price, like shipping, taxes, and import fees. You can calculate it per shipment or per unit, and it’s a key metric for keeping supply chain costs in check. Understanding your true landed cost helps you price products more accurately, protect your margins, and make better inventory and sourcing decisions.
Good to know: Landed cost is not apart of COGS
Understanding and tracking landed cost is especially important when doing business internationally, which involves customs-related costs, exchange rates and other fees…. like, um, tariffs.
The landed cost formula is:
Landed cost = unit cost of product + shipping/freight costs + customs + risk + overhead
It may seem straightforward, but any business owner trying to get a handle on their landed cost without a proper ERP or NetSuite implementation knows it’s not quite that simple:
Example of direct costs included in landed cost:
- Manufacturing
- Freight
- Handling costs
- Packaging, crating and storage expenses
- Insurance
- Currency conversion
- Custom import/export duties
- Tariffs and Taxes
- All other charges incurred along a product’s transport
Example of indirect costs not included in landed cost:
- Cost of labor
- Production-related overhead costs
- Equipment costs
By tracking landed cost you can know the true cost of your product to price things appropriately without cutting into your margins. Because stable margins = stable profitability.
May the force of good data be with you.
How NetSuite’s Landed Cost Feature Works
NetSuite for Manufacturing gives finance and operations teams the ability to automatically allocate all associated costs—such as tariffs and logistics—directly to inventory at the item level. This gives you a precise understanding of product-level profitability in real time. Whether you’re sourcing components internationally or managing a multi-warehouse operation, accurate landed cost tracking helps you avoid surprises and make informed pricing and procurement decisions.
In today’s volatile trade environment, manufacturers can’t afford guesswork. NetSuite’s built-in landed cost functionality empowers small to mid-sized manufacturers to protect margins, streamline financial reporting, and improve overall supply chain efficiency—all while staying compliant with regulatory changes. For companies in the $5M–$100M range, this level of cost transparency can make a critical difference in scaling profitably.
Benefits of Using NetSuite Landed Cost for Manufacturers:
- Accurately track the total cost of goods with tariffs included
- Make smarter purchasing and pricing decisions
- Improve margin analysis by product, customer, or region
- Enhance supply chain and procurement strategy with better cost visibility
- Reduce manual work and errors through automation
3 Tips for Manufacturers to Navigate Trump’s Tariffs
1). Move production out of China
Easier said than done, I know. Look to U.S. suppliers if you think your customers can handle the increase in price, or if you need to keep labor costs low, look for others in countries with lower tariffs like Mexico, Venezuela or Japan.
2). Diversify your supply chain
Along the same lines, you can further protect your supply chain costs by securing vendors from multiple locations like:
- Southeast Asia or India
- Latin America
- Eastern Europe
3). Adjust prices carefully
Unfortunately, the recent tariffs are putting pressure on many supply chains and you may be better off adjusting your prices. But, while it may be tempting to just skyrocket your prices to protect your profit margin, to maintain demand you might first want to:
- Tighten up OpEx
- Tighten up marketing spend
- Run a lean inventory machine:
- Negotiate better pricing with vendors for high volume orders on best-sellers
- Track those landed costs
- Increase prices incrementally to gauge customer retention
Key Takeaways: Navigating Tariff Challenges with Better Tools
- Trump tariffs are unpredictable but your cost management doesn’t have to be.
- NetSuite and accurate landed cost tracking offers the financial clarity manufacturers need in a volatile trade environment.
- Only increase prices where necessary. Protect your margins by diversifying your supply chain and running lean.
Book a free consultation to understand how a landed cost audit and NetSuite accounting can save you time and protect your margins.
