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More precise inventory management can help offset higher costs
Retail cost management strategies
Retailers and retail suppliers are grappling with the implications of new U.S. trade policies, working to find the best ways to manage inventory, plan for demand, and protect customers from rising costs.
Some sped up their imports before various tariff deadlines this year, which has allowed them to sell some items at previous costs and temporarily delay price increases. This strategy had some limitations. Not all manufacturers were able to ramp up production, and grocers couldn’t stockpile fresh items. Others maintained their regular shipping schedules but ordered more cautiously, importing only crucial items. Now, many large retailers are trying to absorb additional costs through operational efficiencies rather than passing them along to shoppers.
Under these conditions, item-level visibility and centralized purchase-order management are key tools for keeping inventory tight and reducing transportation costs.
Many retailers have little visibility into their inbound supply chains because they purchase goods from their suppliers with the storage and transportation costs included. As the receiver of the goods, they may only have visibility to loads or shipments. Knowing where every item is located in their supply chain—even before it’s transported—avoids over-ordering where inventory isn’t needed, enables redistribution of inventory where it is needed, and allows for more precise ordering of new inventory.
Centralizing purchase orders across manufacturers, suppliers, and distributors also opens up possibilities for freight consolidation. Consolidating shipments of products from different suppliers or a cluster of nearby locations may increase truck utilization, lower the number of shipments, and reduce costs.
For retailers and retail suppliers wanting to closely manage inventory by shipping smaller quantities shorter distances, box trucks are an option. They allow for flexible loads and minimize empty miles. C.H. Robinson has expanded its network of carriers that offer this service, giving businesses more options for getting products where they need to go.
U.S. tariff updates
For some of the top countries where retailers and retail suppliers source their merchandise, new U.S. reciprocal tariffs went into effect August 7, 2025.
- Vietnam: 20%
- Thailand: 19%
- Malaysia: 19%
- Cambodia: 19%
- Indonesia: 19%
- Japan: 15%
- European Union: 15%
- India: 25%. An additional 25% tariff has subsequently been announced, which is slated to go into effect August 27.
See our U.S. reciprocal tariff tracker for the new rates for additional countries.
U.S. tariffs intended to stem the flow of illicit drugs were raised to 35% on goods from Canada as of August 1, 2025. A similar increase to 30% for Mexican goods was also put forward. But as of July 31, the White House announced that the drug-related tariff would remain at 25% for at least 90 days, through October 30, 2025. Goods compliant with the U.S.-Mexico-Canada Free Trade Agreement (USMCA) remain exempt.
Meanwhile, the 90-day pause on higher tariffs for Chinese goods is set to expire August 12, 2025, but the United States and China have signaled this deadline could be extended.
Ecommerce impacted by the end of de minimis duty-free shipping
After the White House previously ended the de minimis exception for low-value imports from China and Hong Kong, a new executive order has ended it for goods from the rest of the world. The policy had allowed goods valued under $800 to be shipped duty free and without U.S. Customs paperwork.
Starting August 29, 2025, retailers and brands will be subject to the tariff placed on the country of origin. For postal shipments, specific duties ranging from $80 to $200 per item may be temporarily available for the next six months.
Strategies and support for small business
Proposed tariff exemptions
The U.S. Chamber of Commerce estimates 242,000 small businesses account for roughly one-third of all total imports. The chamber has proposed an automatic tariff exclusion for small businesses with fewer than 500 employees, which often lack the resources to absorb sudden unplanned cost increases. While proposed, there is no formal process for small businesses to be given tariff exemptions.
Improving operational efficiencies
Economic disruption, while challenging, often creates opportunities to strengthen operations. Small businesses should examine day-to-day operations to eliminate hidden costs, especially in shipping and logistics. Simple changes in how orders are processed may significantly impact total freight expenses. For example, adjusting order quantities or improving lead times may reduce shipping expenses. Taking time to analyze these operational details may uncover savings that directly improve the bottom line.
Adding purchasing power through buying groups
Many small businesses in similar industries or product categories band together to form buying groups or cooperatives. These groups combine the purchasing power of multiple businesses, allowing them to negotiate lower prices from suppliers. These groups often have membership fees or charge a small percentage of the savings generated for their members as a way to help cover the operational costs of the group.