Successfully Navigate New Tariffs — and Other Changes — with Redwood International

President-Elect Donald Trump not only promised to expand tariffs on imported goods when he takes office on January 20 — he made it a cornerstone of his successful campaign. Specifically, Trump has vowed to increase all import tariffs by 10-20% — and raise tariffs by 60-100% on imports from China. What will it mean for your business if these tariffs are enacted? Exactly when would any new tariffs take effect? And what can you do in the meantime to profitably navigate these changes?  

Scott Hollinger, Vice President of International Services at Redwood, is uniquely qualified to answer those questions. Scott leads the Global Distribution and Logistics (GDL) team at Redwood, which is the International service offering that helps customers with their international business needs — including customs clearance, cross-border logistics and global transportation. Backed by deep expertise and decades of hands-on experience, the Redwood GDL team provides both strategic advisory services and hands-on execution.  

Recently Arlyn Knox, Redwood’s Chief Marketing Officer, asked Scott the pressing questions that are on every global logistics professional’s mind in the lead-up to Inauguration Day on January 20. 

Arlyn Knox (AK): What can you tell us about the potential timing and impacts of Trump’s tariffs for shippers sending products to the US?  

Scott Hollinger (SH): While Trump has talked a lot about implementing tariff increases, little is known about the “what” and the “when.” We don’t know exactly what products this will apply to, or to what extent. We also don’t know exactly when the proposed tariffs will take effect. We do know that it takes some time for US customs and government systems to make these kinds of sweeping changes. Nobody knows exactly how long it will take. But it could take weeks, if not months, to get any new tariffs enacted. 

AK: Assuming the tariffs are announced soon, what can companies do to prepare for the impacts on their own business?  

SH: We saw some companies take smart, strategic actions around tariffs during Trump’s last term in office. For example, President Trump implemented increased tariffs on aluminum extrusions through anti-dumping duties imposed on certain countries. Redwood’s GDL experts helped our affected customers deploy various duty mitigation strategies. Some examples of those strategies are identifying more cost-effective sources of supply in Vietnam, Mexico, Latin America and other regions that were unaffected by those duties. We’ve also seen companies use what’s called the “first sale program” with US Customs. Those companies essentially pay duties on their supplier’s costs versus their own costs, which means they can reduce their duty exposure. Most of the large US retailers utilize this program. But it requires strong trust in the supplier, as well as rigorous, structured processes and protocols in both purchasing and compliance. Both these approaches can mean big supply chain changes, which take time. Global supply chains are not quick to pivot. 

Probably the most common reaction we’ve already seen — and will continue to see in the coming months — is more straightforward. Companies are pulling forward their future inventories to get their goods into the US prior to the new tariffs. This can include various options such as fast boat service, transloading at the US East or West Coast, or air freight. 

AK: What do you think of these “pull forward” short-term strategies? Are companies panicking or acting strategically?   

SH: The short-term strategy of pulling inventory forward needs to be compared with any estimated duty increases — and must also consider risk exposure. Let’s face it, expediting is expensive, whether it’s fast boat service, coastal transload or air freight. It’s also expensive, and risky, to hold excess inventory that may or may not sell. I would counsel importers to think long-term and investigate other, more cost-effective sources of supply — then build new relationships and supply chain infrastructure around those sources. At Redwood, we understand that’s not as easy as it sounds. But we’re here to help. 

AK: Why should companies partner with Redwood International? 

SH: Redwood has a “big picture” view, as well as many years of experience, that can help companies explore innovative new global trade strategies. For example, we can help customers identify new suppliers, new routes or new network models. We can analyze the costs associated with implementing those strategies, including any new supply chain infrastructure and other capital investments. And, based on that analysis, we can intelligently guide customers on which solution is the best fit from a total landed cost perspective. 

AK: What other logistics trends do you foresee as Trump takes office?

SH: Products are going to get more expensive — that’s the bottom line. US consumers are ultimately going to absorb any tariff increases incurred by importers. What does that mean for importers? It’s more important than ever to operate the global supply chain with efficiency, speed and precision. Costs and time need to be driven out at every node to help keep consumer prices within reach. That’s a tall order. But, as a modern 4PL, that’s what we do at Redwood. The logistics industry is entering a period of uncertainty and change, but it’s gratifying to help our International customers — and all our customers — navigate those changes with greater success and profitability.  

No matter what new tariffs are enacted — and no matter when they take effect — Redwood International can help you navigate them. Contact Redwood today to start preparing for the future of global trade, no matter what that future looks like.