Tariff Turbulence: Six Strategic Moves CFOs Must Make Now

By Bill Beyer

Early in my career, I was tasked with driving the international business for a communications equipment company with a business partner. My colleague owned international sales and marketing, and I was responsible for structurally conducting commerce in our targeted markets.

My responsibilities included (i) consideration of a permanent establishment (i.e. a local business presence) in each country and existing tax treaties, (ii) mitigating foreign currency and country-specific risk, (iii) utilizing resources such as EXIM Bank, and (iv) efficiently exporting our communications equipment, among other duties.

The latter included efforts to minimize local tariffs to remain price competitive. For example, certain countries established higher tariffs for hardware and lower tariffs for software. Given the high software content of our product, we utilized an international price list delineating prices for hardware and software that differed from our domestic price list.

I enjoyed the challenge of creatively accomplishing that objective.

Whether universal or reciprocal, the current administration’s enactment of significant U.S. import tariffs creates challenges for domestic and foreign company CFOs.

This article details six actions CFOs and leadership teams can take in response to current U.S. policy.

Integration: An Underlying Premise

My colleagues across my client companies’ general and administrative (G&A) functions often hear me speak about integration. An overarching objective of accounting, finance, legal, IT, and human resources is to add value to the balance of our organization and its stakeholders.

Critical to adding value is being integrated into the functional decision-making of the broader organization.

In response to the current tariff policy, the following six actions assume that the CFO is fully integrated in functional decision-making, principally with Supply Chain, Legal, and Sales functions.

CFO Action #1. Map Tariff Exposure Across the BOM and Tech Stack

For manufacturing entities, start with the Bill of Materials (BOM) and look particularly at critical hardware components and global service dependencies.

• Identify parts, subassemblies, and finished goods affected by tariffs (e.g. semiconductors, PCBs, lithium batteries, rare earth materials, etc.).
• Flag at-risk vendors and assess reliance on countries like China, Mexico, or others subject to recent or proposed tariffs.
• Calculate incremental cost increases and model margin impact.

Why it matters: Manufacturing entities are capital- and import-intensive; even small tariff changes can significantly affect COGS and gross margins.

CFO Action #2. Redesign the Supply Chain for Strategic Agility

Take action to make the supply chain less tariff-sensitive:

• Source critical components from alternate countries (Vietnam, India, Eastern Europe).
• Explore friend-shoring or reshoring for high-value or high-risk inputs (e.g. chip packaging or final assembly).
• Consider geographic diversification of contract manufacturers and fabs.

Why it matters: Resilient supply chains reduce downtime and cost variations during geopolitical swings.

CFO Action #3. Review Pricing Models and Customer Agreements

Manufacturers and tech companies often deal with long-term contracts and fixed pricing. Now is the time to:

• Add tariff escalation clauses into new customer and distributor contracts.
• Revisit pricing for high-volume SKUs or flagship products.
• Consider differentiated pricing for customers in un-tariffed markets.

Why it matters: Maintaining margin discipline is critical when component costs rise unexpectedly.

CFO Action #4. Update Forecast Models with Tiered Tariff Scenarios

Forecasting should reflect uncertainty. Build tiered models that account for:

• A base case (status quo tariffs), a mid-case (moderate increases), and a worst-case (broad expansion of tariff lists).
• Potential customer churn due to price increases.
• Inventory pre-buys or delays due to trade policy timelines.

Why it matters: Scenario planning ensures that regulatory shifts do not blindside you and can align your company’s spend accordingly.

CFO Action #5. Maximize Tax & Trade Relief Mechanisms

Referencing the opening paragraph of this article, product classification and cross-border strategies can yield savings:

• Utilize tariff engineering (e.g., altering assembly steps to qualify for different Harmonized Tariff Schedule (HTS) codes).
• Participate in Duty Drawback or Foreign Trade Zone (FTZ) programs for re-exported goods.
• Leverage R&D tax credits or other incentives to offset rising costs elsewhere.

Why it matters: These tactics can protect margins without drastically shifting operations.

CFO Action #6. Coordinate Cross-Functionally and Communicate Proactively

On the theme of integration, CFOs should lead communication across departments:

• Work with engineering and product teams on design changes that could circumvent tariffs.
• Sync with procurement and logistics to align on lead times, freight costs, and order volumes.
• Keep investors informed of tariff impacts and mitigation strategies in earnings guidance or board updates.

Why it matters: Cross-functional awareness enables smarter decision-making and maintains stakeholder trust.

Turning Tariff Risk into Strategic Opportunity

Tariffs may be a multinational bargaining chip, but their financial impact is deeply operational. For CFOs, they represent not only margin pressure but also a catalyst to revisit assumptions, challenge legacy systems, and bring finance into deeper alignment with supply chain, legal, and commercial functions.

The six actions outlined require CFOs to operate as integrators and strategic enablers. By proactively addressing tariff exposure, finance leaders can protect margins, unlock tax efficiencies, and position their companies to thrive amid uncertainty.

Ultimately, the CFO’s role is no longer just about managing the numbers; it’s about navigating complexity and helping the business respond with agility and foresight. Tariff strategy is yet another arena where today’s CFOs can demonstrate their expanded leadership mandate.