Why Manufacturers Should Act Now—Not Later—Amid Tariff Uncertainty
Normally, I’m not one to say I told you so, but...
The April 2 announcement of sweeping tariffs, and the on again, off again, delayed implementation of them has caused untold wringing of hands and worrying. Let me add another perspective to the cacophony.
Stop it!! Yes, you heard me right. Stop worrying and pausing projects and fretting. It is time for decisive action. We don’t need more analysis. Right now, all analysis is saying the same thing “We don’t know what is going to happen”. The truth is you never know what is going to happen. But we as humans are prone to embrace a negative bias. That worked great when we were hiding from saber tooth tigers. Now it causes us to spend too much time thinking about all the bad things that might happen. But the leaders that are action oriented are getting a head start on their competition. Let’s look at four things better than waiting.
First, build reliability into your operations. If you aren’t ready to expand, as we will discuss in a bit, make sure your current customers can continue to see you as a trusted supplier. This means increasing maintenance on your machines, building relationships with new suppliers, preferably domestic, to consolidate your supply chain, and making sure you have the data to make the best decisions.
Second focus on building your capacity. The last thing you want to do is try to add an expansion project after business takes off. The latest figures showed US manufacturing capacity at 78%, two points off of what is considered normal full capacity. But manufacturing capacity is hard to add in the current labor market. Enter automation. Robotics is coming at a time when humans are exiting the manufacturing workplace. Adding automation is a way to build reliable capacity and solve for the future as the long-term workers retire. Don’t shy away from it, investigate it.
Third, reimagine your products. Materials, applications, new markets. Just because your customers are primarily manufacturing capital equipment doesn’t mean they are the only ones that need your product. Just because you have always made the product out of the same material doesn’t mean you can’t take advantage of the advances in material science. This is an example of making your luck. Think about new things and you will be amazed with what comes up.
Finally, strengthen your decision support system. Are you running your business on Excel or printing multiple reports to gather the data you need to make decisions. Stop it!! There are better ways. Yes, they take money, but you are building reliability into your operations as well as improving how you make decisions.
It is easy for me to give advice. I am not the one signing your checks, but I think history supports actions in time when others are waiting. Rockefeller, Bezos, Vanderbilt, Firestone, they all took action. Wheeler, Clay, Adams, not so much.
April 29, 2025
