Gartner: Supply chain leaders plan to pass costs to customers as top tariff mitigation strategy

May 7, 2025May 10, 2025 GaryPageau Gartner

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According to a survey by Gartner, Inc., 45% of supply chain leaders anticipate passing costs to their customers as their primary strategy for mitigating new tariff costs. Forty-three percent of respondents stated they would mitigate the costs through various supply chain initiatives as their primary strategy. Gartner surveyed 126 supply chain leaders from March 17, 2025, through April 7,2025, on their planned responses to new tariff policies and specific mitigation actions. Qualifying organizations reported enterprise-wide annual revenue of at least $50 million, with 83% of respondents coming from organizations with $1 billion or more in revenue.“Supply chain leaders have many potential levers to pull from in mitigating new costs related to tariffs,” said Vicky Forman, Senior Director Analyst in Gartner’s Supply Chain practice. “While supply chain leaders have multiple initiatives underway to potentially lessen the impacts, many of these actions have yet to be completed.”While “increased costs” was the top risk associated with new tariffs, cited by 92% of respondents, 75% also flagged concerns about slowing customer demand among the top three risks to their business. These risks included an overall decrease in consumer demand (cited by 49%), as well as concerns about retaliatory measures impacting international customer demand (cited by 45%).

As a result of these concerns, Forman emphasized the importance of numerous supply chain initiatives underway that could help organizations mitigate new tariff costs beyond passing costs to customers, especially over the longer term. The supply chain initiatives to mitigate tariff impacts planned (or already underway) most cited by respondents included:

Renegotiating supplier contracts (47%)
Exploring collaboration opportunities with suppliers (43%)
Addressing country of origin, valuation and other trade management tactics (40%)
Adjusting supply locations outside the United States (39%)
Adjusting production locations outside of the United States (26%)
Pulling inventory forward (23%)

Gartner clients can read more in How Supply Chains Are Responding to New U.S. Tariffs and Policies. Nonclients can learn more in How CSCOs Can Turn Tariff Volatility Into a Competitive Advantage.