Protecting Margins & Reputation Amid Trade Uncertainty

In Part 1, we discussed essential strategies for supply chain resilience, emphasizing how CEOs are diligently mapping dependencies and diversifying their risks. However, resilience isn’t solely operational; it also fundamentally involves how you protect your profit margins, maintain pricing integrity, and nurture client relationships as global trade dynamics continue to shift.

The reality is that tariffs aren’t just abstract policy; they are a direct source of significant pressure. This pressure is compelling CEOs to make difficult, yet crucial, decisions about their pricing strategies, communication approaches, and overall leadership.

Where Margins Meet Messaging

The first question every CEO naturally asks in this challenging environment is, “Can we simply pass the cost on to our customers?”

A more insightful question to consider is, “How do we pass on these costs without eroding customer trust or losing valuable clients?” Your brand’s true strength is not built during prosperous times; it is rigorously tested and proven during periods of significant challenge like these.

In my Vistage Florida CEO groups, members are grappling with these decisions in real time. They are discovering that the solution isn’t about entirely avoiding price increases, but rather about how strategically and transparently you manage them. It ultimately comes down to clear communication, precise timing, and unwavering honesty.

What CEOs Are Doing Right Now to Stay Ahead

1. Proactively Reframe Pricing Conversations

Avoid burying price increases in fine print. Instead, own them with complete clarity and provide compelling context. Share how your company is absorbing some of the financial burden through improved efficiency, technological advancements, or successful renegotiations. Consistently reinforce the inherent value behind your pricing, whether it’s superior service, impressive speed, uncompromised quality, or unwavering consistency. CEOs who communicate early and with confidence are successfully retaining customers and simultaneously deepening customer trust.

2. Use AI and Analytics to Adjust in Real Time

Cutting-edge AI tools are empowering CEOs to run detailed tariff impact simulations across their entire range of SKUs and various pricing tiers. This capability allows for strategic, surgical price adjustments rather than broad, undifferentiated hikes. Other leaders are utilizing AI to help their clients understand the underlying cost drivers, thereby transforming simple education into a powerful competitive advantage.

3. Reevaluate Contracts and Terms

Thoroughly review all clauses related to cost sharing, pass-through mechanisms, and renegotiation timelines in your existing contracts. When initiating new contracts, incorporate more flexible pricing language from the outset. Bring in experienced legal and sourcing advisors now, before you find yourself in a significant margin squeeze.

4. Protect the Brand While You Pivot

If you begin sourcing from new regions, ensure you are transparent about your quality assurance processes. Should you need to adjust lead times or fulfillment options, proactively manage customer expectations. Remember, your customers don’t necessarily demand perfection; what they truly need is unwavering honesty and consistent performance. This approach fosters strong customer loyalty in uncertain times.

Where Peer Insight Makes the Difference

This is precisely where the unparalleled power of peer groups like Vistage becomes absolutely mission-critical. You simply don’t have the luxury of time to reinvent the wheel. However, you do have invaluable access to other CEOs who have already rigorously tested various pricing models, successfully rewritten complex contracts, or skillfully adjusted their sourcing strategies across multiple continents.

In our recent Vistage discussions, one member vividly shared how AI helped them completely realign their global sourcing model, effectively avoiding a significant $1 million tariff hit. Another demonstrated how their commitment to transparency in pricing not only prevented pushback but also fostered deeper customer loyalty. You truly don’t have to navigate these complex waters alone, and frankly, you shouldn’t.

Final Thought: This Is CEO Work

It’s insufficient to simply delegate tariff management solely to your legal, finance, or procurement departments. This is a matter of overarching strategy. It directly impacts your profit margins. It fundamentally shapes your brand. This is your table to sit at and lead from.

If you would like more insights into what you can do to keep help your business thrive, let’s connect. I can help your team navigate these challenging and rapidly evolving times.

Georganne Goldblum,
CEO of Coach4Execs

About Georganne

Georganne Goldblum is a seasoned executive coach with over 20 years of experience, specializing in coaching senior executives to outperform their goals and competition. Drawing from her impressive background as a Fortune 500 executive, management consultant, entrepreneur, and private investor with over 25 years of management experience, Georganne brings a wealth of knowledge and expertise to her coaching. She helped 7 companies optimize their business exits in the last 5 years, netting over $1.1 billion. Over the last 9 years, assisted 13 companies in achieving exits totaling over $2 billion.

An MBA graduate from the renowned NYU Stern School of Business, her impact and influence in the industry are evident through the numerous accolades and awards she has received, including the prestigious Charles “Red” Scott Award. She has been recognized as one of the Most Influential Businesswomen in South Florida. Connect with her on LinkedIn.