Inventory management leader surveyed over 100 American small- and medium-sized businesses, revealing SMBs anticipate significant impact and rising costs.
Netstock, a leader in supply chain planning solutions for small and medium-sized businesses (SMBs), today released its 2025 Tariff Impact Report: Challenges, Strategies and Regional Insights for SMBs. The company surveyed over 120 customers, representing American SMBs under $500M in revenue, to understand how they are reacting to the volatile tariff environment. With constant shifts and the potential for significant disruption looming, Netstock sought to quantify the real-world impact of these tariffs, identifying challenges, concerns and strategies in this landscape.
We’re committed to helping SMBs stay informed as the market evolves,” said Ara Ohanian, CEO of Netstock. “By surveying our customers, we share real-world insights on how U.S. tariffs are impacting inventory planning. It’s all about providing businesses with relevant data that can help them navigate the current challenging supply chain landscape.
SMBs brace for major impact from tariffs, citing cost as main concern
Tariffs are a significant disruptor for businesses of all sizes, but their impact is amplified for SMBs who often lack the resources that larger enterprises can leverage. Netstock’s data reflects this sentiment: 63% of respondents anticipate a moderate to major impact from new tariffs, signaling major challenges on the horizon.
The complexities of navigating widespread tariffs also present a new challenge for many SMBs. Notably, 75% of SMBs have either not implemented tariff mitigation strategies before, or have faced challenges doing so, indicating a still evolving response to this landscape. A significant portion (nearly 20%) have over 75% of their inventory exposed to tariff risks. While SMBs grapple with these issues, the most significant concern is rising costs, with 70% citing it as their biggest challenge.
China tariffs top SMB concerns, while North American trade feels more comfortable
While tariffs on US neighbors (Canada and Mexico) are dominating the conversation, nearly half of SMB respondents (47%) expressed great concern regarding tariffs impacting trade with China. In fact, 74% view tariff risks from China as either moderate or severe. This sentiment contrasts sharply with the minimal anxiety regarding tariffs with Canada (7% highly concerned) and Mexico (6% highly concerned), where approximately 60% of SMBs perceive only minimal risk.
SMBs balance caution in tariffs approach
In response to the new and unexpected tariffs, SMBs are adopting a cautious and proactive approach. A significant 57% of SMBs are taking a “wait-and-see” approach, closely monitoring policy changes and delaying major operational shifts. At the same time, 58% of SMBs are diversifying their supplier base to enhance long-term resilience. This strategic move suggests SMBs anticipate prolonged trade disruptions and are building flexibility into their supply chains. Nearshoring, while considered by only 15% of SMBs as a viable supply chain strategy, faces significant resistance. Over 40% express hesitation and 41% currently reject this approach; their hesitation stems from unpredictable tariff policies on neighboring countries, Canada and Mexico.
Technology empowers SMBs to make informed, proactive decisions for supply chain resilience
A significant majority (75.8%) of respondents are utilizing data-driven tools in their supply chain strategies. This reflects the growing recognition that technology enables businesses to quickly identify the potential impacts of tariffs and other disruptions, optimize inventory levels to mitigate costs, and boost overall supply chain resilience.
The data is clear: widespread tariffs will create challenges for SMBs
So, what should your business do now?
The answer is different for every company, but in the short term, SMBs should identify and redistribute excess inventory. As tariffs are imposed, holding onto excess inventory could become a financial burden. Redistributing stock could help businesses free up cash flow and clear out inventory before new costs hit.
For the long term, SMBs can work to evaluate alternative suppliers in lower-risk, non-tariff-impacted locations to lower transportation costs, reduce lead times and offer flexibility amid shifting trade policies.
