Act now for the future

Are your getting ready today for possible business conditions in the fall?

Yes, we live in a world of high uncertainty.  Tariffs are the wild card, obviously, but here’s what we know as of today:

• GM’s profit fell by 1/3 as it was hit with $1.1B in tariffs
• The government announced an agreement with Japan on 15% tariffs.  While not the threatened 25%, costs for imported goods from Japan will still be +15%.  For other countries, tariffs agreements have not been made yet
• GDP for Q2 will come out soon.  Current GDP estimates from both the Fed and the World Bank for full year 2025 is only +1.4%

There’s a certain comfort in a “wait-and-see” approach, but there is a risk as well that if the economy slows and you suddenly need to take action, you will have to do so crudely and may cut muscle, not fat.  You may also cut the exact areas where you should be investing in.

A little planning now can avoid these problems.  If you are directly affected by tariffs, you probably are looking at alternative sources, what the impact is to you, how the tariffs will likely affect competitors, and what you should do re: pricing, for each product.  

Regardless of whether you might be directly or indirectly impacted, you can also take this “uncertain time” to evaluate 

1. where you are profitable (and not profitable) at a detailed product and customer level, 
2. assess what that means for your strategy & operations, and
3. if the business slows, what specific actions you would take

The advantage of doing this now is that if grim forecasts for the 2^nd half of the year come true, you can make decisions with confidence that will improve the business, and that you will have the facts to communicate to the organization.  If the economy softens, you will know exactly what to do, and if it doesn’t, you can still stage your actions that reflect the business outlook at that time.

Look ahead.  Plan for different outcomes.  Start now so you are ready.  Don’t wait.