By Jasmine Clarke, Senior Correspondent
Washington, D.C. — June 3, 2025
A recent survey conducted by insurance brokerage Gallagher has unveiled significant concerns among U.S. business owners regarding the impact of President Donald Trump’s expansive tariff policies on supply chains. The survey, encompassing 1,000 U.S. business owners, revealed that 90% are apprehensive about the effects of tariffs, with 69% identifying supply chain disruptions and severe weather as major risks. Additionally, 72% cited cyberattacks as a top concern over the next year, and nearly all respondents expressed worry about the impact of artificial intelligence, up from 85% the previous year.
Escalating Tariff Measures and Economic Repercussions
In April 2025, President Trump announced a comprehensive tariff strategy, dubbed “Liberation Day,” imposing a 10% universal tariff on all imports, with heightened rates of up to 125% on goods from China and 20% on European Union imports. These measures have sparked significant market reactions and prompted retaliatory actions from affected countries.
The trade war has already inflicted over $34 billion in losses on U.S. companies due to lost sales and increased costs. Manufacturing activity has contracted for the third consecutive month, with declines in new orders, backlogs, production, and employment. These developments have raised concerns about the long-term viability of American manufacturing and the potential for recessionary pressures.
Supply Chain Vulnerabilities and Business Adaptations
Gallagher’s CEO, J. Patrick Gallagher, emphasized the fragility of global supply chains amid geopolitical tensions and extreme weather events. He noted that business owners are taking steps to diversify and protect their operations from potential impacts.
The elimination of the de minimis exemption, which previously allowed goods valued at or under $800 to enter the U.S. duty-free, has further complicated import processes. Approximately 65% of surveyed businesses anticipate significant impacts on their imports due to this policy change.
In response to these challenges, companies are exploring strategies such as origin engineering, nearshoring, and utilizing Foreign Trade Zones to mitigate tariff impacts. These tactics are aimed at reducing dependence on high-tariff countries and ensuring continuity in the supply chain.
Broader Economic Implications and Industry Responses
The tariffs have led to increased costs across supply chains, with manufacturers facing higher input costs and potential layoffs. Industries such as automotive, technology, fashion, and pharmaceuticals are particularly affected, experiencing rising input costs and supply chain disruptions.
Small businesses, operating on tight margins, are struggling to adapt to abrupt supply-chain changes and rising import taxes. Many are projecting significant profit hits, with some facing potential unprofitability if tariffs persist.
Mid-sized companies are also feeling the pressure, with many expecting supply chain disruptions and higher raw material costs. Approximately 9 in 10 anticipate product delivery delays or shortages. This widespread concern underscores the need for robust contingency planning and risk management.
Strategic Shifts and Future Outlook
Businesses are increasingly investing in technology to enhance supply chain resilience and visibility. A survey by RSM US found that 91% of supply chain decision-makers agree on the need to invest in technology to manage operations effectively.
Companies are also adopting “China plus one” strategies, diversifying sourcing to countries like Vietnam and India to reduce reliance on any single country. These approaches are seen as essential in navigating the evolving global trade environment.
While some firms are considering reshoring operations to the U.S., factors such as cost, taxation, technology, and workforce availability play crucial roles in these decisions. Reshoring may offer long-term stability but requires substantial investment and strategic foresight.
As the global trade landscape continues to evolve, U.S. businesses must navigate the complexities of tariff policies, supply chain disruptions, and geopolitical tensions to maintain operational stability and competitiveness.