Sourcing Strategies Supply Chain Management

Managing risk in a shifting trade landscape

Managing risk in a shifting trade landscape

Amidst uncertainty in US-China trade relations, a temporary 90-day tariff suspension has prompted companies across the electronics industry to reassess their sourcing strategies. For global electronic component distributor Sourceability, the announcement represented both a potential short-term advantage and a call for long-term strategic agility.

In this exclusive interview, Rob Picken, Senior Vice President of Digital Transformation at Sourceability, outlines how the company has been managing tariff volatility through diversification, predictive analytics, and real-time supply chain visibility. He also explores the possible ramifications of the temporary tariff reductions, including how they may impact pricing, lead times, and procurement behaviours across Sourceability’s global customer base.

How has Sourceability been managing the volatility of US-China tariffs, and what immediate operational changes might be triggered by the 90-day suspension recently announced?

Sourceability has proactively managed tariff volatility by diversifying its supplier network, investing in real-time supply chain monitoring, and leveraging predictive analytics. These strategies allow us to anticipate disruptions, shift sourcing as needed, and maintain operational resilience. The 90-day suspension may invoke operational changes such as a reassessment of inventory strategies and temporarily increasing reliance on US-China trade lanes where cost advantages re-emerge. Sourceability continues to monitor the situation closely, ready to pivot sourcing and logistics strategies should tariffs be reinstated.

Additionally, this suspension period provides a window to proactively strengthen relationships with key suppliers and logistics partners, ensuring they can respond quickly to any further changes in trade policy. The opportunity to accelerate shipments of critical components also presents itself, taking advantage of the temporary cost savings to build up inventory for future demand. By maintaining this agile and data-driven approach, Sourceability is well-positioned to minimise disruptions, control costs, and continue delivering value to its clients regardless of ongoing tariff uncertainties.

With tariffs temporarily reduced to 30% on Chinese imports and 10% on US exports, how do you anticipate this will influence component pricing and sourcing decisions across your global customer base?

The temporary reduction in tariffs may create short-term price advantages for components sourced from China, prompting some customers to accelerate purchases or shift orders back to Chinese suppliers. Sourceability saw a noticeable bump in procurement during March where sales increased 19% YoY, likely due to pre-tariff panic. There is a chance that the same will happen during this period.

In the near term, we anticipate heightened demand volatility as customers seek to capitalise on lower costs, leading to bulk buying or forward ordering to lock in savings before tariffs are potentially reinstated. This could result in temporary supply constraints or longer lead times for certain high-demand components. Additionally, some customers may revisit their sourcing strategies, weighing the benefits of returning to Chinese suppliers versus maintaining relationships with alternative sources developed during previous tariff hikes.

Sourceability will continue to provide market intelligence and flexible sourcing options to help clients navigate these shifts. Our global team is prepared to support rapid changes in demand, ensuring customers can optimise their procurement strategies and manage risk effectively as the tariff landscape evolves.

Given the temporary nature of this agreement, what steps is Sourceability taking to help customers mitigate future tariff risk beyond the 90-day window?

Sourceability is advising customers to avoid overreliance on any one region and to use this period to strengthen relationships with alternative suppliers. By encouraging geographic diversification and supporting the adoption of digital supply chain solutions, Sourceability ensures customers are better positioned to respond quickly to renewed tariff volatility after the 90-day period.

In addition, we are working closely with clients to conduct comprehensive risk assessments and scenario planning, helping them identify potential vulnerabilities in their current sourcing strategies. We are also facilitating access to real-time market intelligence and predictive analytics tools, enabling customers to make informed decisions and anticipate future disruptions. By leveraging these insights, customers can proactively adjust procurement schedules, negotiate flexible contracts, and build strategic inventory buffers where appropriate.

We are committed to fostering collaboration between customers and a broader network of vetted suppliers, streamlining the onboarding process for new partners and ensuring continuity of supply. Through regular communication, educational webinars, and tailored consulting, Sourceability empowers its global customer base to build more agile, resilient supply chains that can withstand future tariff changes and other external shocks.

Have you noticed greater demand for alternative sourcing from regions outside of China during periods of heightened tariffs?

Yes, periods of heightened tariffs have consistently driven increased demand for alternative sourcing, particularly from regions such as Southeast Asia, Eastern Europe, and Mexico. Customers are seeking to reduce risk and improve supply chain resilience by expanding their supplier base and exploring nearshoring or reshoring options. Gartner studies show that 30% of companies are still taking a wait-and-see approach, in comparison to the 61% that are diversifying their supply chains. The COVID-19 pandemic and following black swan events from natural disasters and geopolitical tension should be an example case that supports strengthening diverse sourcing.

In recent years, Sourceability has observed a marked uptick in inquiries and orders from suppliers outside of China, as customers look to mitigate both tariff and geopolitical risks. This trend is further supported by advances in digital supply chain management, which make it easier for companies to identify, qualify, and integrate new suppliers from a wider range of regions. Additionally, customers are increasingly interested in building more flexible, multi-sourced procurement strategies to ensure continuity in the face of future disruptions. Sourceability continues to support these efforts by providing market intelligence, supplier vetting, and logistical support, helping clients build robust and agile supply chains that can adapt to an ever-changing global landscape.

How do you anticipate this development affecting lead times or the allocation of high-demand components?

The temporary tariff reduction may lead to a surge in orders for Chinese-sourced components, potentially straining supply chains and impacting lead times for high-demand items. We also expect to see an increase in lead time and price trends due to Samsung’s DDR4 EOL announcement alongside other disruptions, from company bankruptcies or mergers occurring simultaneously.

As customers rush to take advantage of lower tariffs, suppliers may experience capacity constraints, resulting in longer fulfilment cycles and possible allocation challenges for critical components. This heightened demand could also lead to spot shortages and increased competition for limited inventory, particularly for components already in tight supply. Additionally, logistical bottlenecks, such as port congestion or limited freight availability, may further exacerbate delays. This is especially true if multiple customers are expediting shipments within the same window.

Sourceability is closely monitoring these dynamics and working with customers to forecast demand more accurately, secure allocation ahead of time, and explore alternative sourcing options when necessary. By leveraging real-time supply chain data and maintaining open communication with both suppliers and customers, Sourceability aims to minimise disruptions, optimise lead times, and ensure continuity of supply even as market conditions fluctuate.

How closely are you tracking regulatory updates during this 90-day period, and how do you communicate changes or risks to your customers?

Sourceability’s global sourcing team works hand-in-hand with our product, compliance, and purchasing teams to not only monitor disruptions but to identify alternative parts/suppliers to provide customers with feasible solutions should products become unavailable. Transparency and timely information-sharing are key to helping customers make informed decisions in a rapidly changing environment.

To ensure we stay ahead of regulatory developments, Sourceability leverages real-time monitoring tools and maintains direct lines of communication with trade authorities and industry partners. Our teams conduct daily reviews of regulatory updates, tariff changes, and geopolitical developments that could impact supply chains. When new information emerges, we promptly assess its potential impact on our customers’ procurement strategies and inventory positions.

We communicate these changes through multiple channels, including personalised email alerts, regular market intelligence reports, and proactive outreach from dedicated account managers. Additionally, we host webinars and provide tailored consultations to help customers navigate complex regulatory landscapes and mitigate emerging risks. By prioritising clear, proactive communication, Sourceability empowers customers to adapt quickly, minimise disruptions, and maintain business continuity throughout the 90-day period and beyond.

What advice would you give to procurement professionals trying to balance cost, risk, and availability in the wake of this announcement?

Procurement professionals should avoid making decisions based solely on short-term cost savings. Instead, they should focus on building a resilient supply chain by diversifying suppliers, investing in real-time visibility tools, and maintaining flexibility in sourcing strategies. It’s also crucial to stay informed about regulatory changes and to collaborate closely with supply chain partners to anticipate and mitigate risks. Leveraging predictive analytics and emerging technologies can provide a competitive edge in managing ongoing volatility.

In addition, procurement teams should consider developing robust scenario planning processes to prepare for a range of possible outcomes, including sudden tariff reinstatements or supply disruptions. Establishing strong relationships with both primary and secondary suppliers can help ensure continuity of supply if market conditions shift unexpectedly. Regularly reviewing and updating risk assessments, as well as maintaining strategic inventory buffers for critical components, can further safeguard operations. Finally, fostering open communication across internal teams and with external partners will enable faster response times and more informed decision-making. By taking a holistic, proactive approach, procurement professionals can better balance cost, risk, and availability, positioning their organisations to thrive even in uncertain market environments.