Tariffs creating uncertainty and cost pressures for SMBs, Netstock report finds

Small and medium-sized businesses (SMBs) are struggling to adapt to an increasingly volatile global trade environment, with shifting tariffs driving up inventory costs and disrupting supply chains, according to a new report by supply chain software firm Netstock.

The Tariff Impact Report, produced in collaboration with supply chain expert Lora Cecere, draws on survey data from 126 North American SMBs and highlights a lack of preparedness across the sector. Only 12 per cent of respondents said they rely heavily on analytics to navigate trade volatility, despite nearly two-thirds expecting tariffs to have a moderate or significant impact on operations.

“Current supply chain practices are not designed to operate in a high tariff and compliance environment,” the report warns, urging companies to shift toward proactive, data-driven decision-making.

Trade tensions with China remain a top concern, with 74 per cent of businesses viewing tariff risks from China as moderate or severe. While reshoring has been touted as a solution, only 15 per cent of SMBs say it’s a feasible option.

Instead, the report recommends investing in analytics and inventory planning tools to mitigate risks, improve forecast accuracy, and adapt to unpredictable shifts in both supply and demand.

More than half of respondents anticipate tariffs will increase the cost of over 50 per cent of inventoried items, prompting warnings about rising safety stock requirements, longer lead times, and potential supply shortages.

Despite the challenges, 57 per cent of SMBs are taking a wait-and-see approach. Netstock says that delay could prove costly as tariff policies evolve rapidly.

“Data is no longer just information—it’s a competitive asset,” the report concludes. “Those who adapt will turn uncertainty into opportunity. Those who don’t risk falling behind.”