US President Donald Trump’s new 50% tariffs on Canada mark another shift in an unpredictable trade environment, adding another layer of uncertainty for retailers already trying to keep up with ongoing tariff volatility, according to a new report by DOSS.
The study found that:
- On average, 38% of company revenue is directly impacted by tariff policy changes
- Passing increased tariff costs on to customers (33%) is the most common strategy companies are using to manage rising expenses
- 45% of decision-makers report holding excess inventory longer than planned, and 58% say their companies absorbed costs they initially intended to pass on to customers
- 40% say their companies began repricing affected goods or services in response to tariff changes
- 25% accelerated purchases to lock in pricing, while 25% re-forecasted revenue or margin projections
- 53% say they are spending more time reacting to trade policy changes than investing in long-term growth
For businesses already navigating tariff uncertainty, another escalation could create additional pressure across pricing, inventory, and operations.
Here’s the full study: Tariff Risk Analysis & Supply Chain Impact Report
In an interview with Retail Insider, Wiley Jones, Co-Founder & CEO at DOSS, shared his thoughts on the situation.
Question: With tariffs now at 50%, what are retailers telling you is their biggest operational challenge compared with previous rounds of tariff increases?
Answer: Past tariff rounds gave retailers room to make one move at a time. They could shift some sourcing, go back to their suppliers to renegotiate, and see how it played out. At 50% there isn’t time for that. Prices, sourcing, and inventory all have to change together, and then they have to change again a few weeks later when the policy moves again. The hard part is that most teams are running those decisions off a pile of spreadsheets and systems that don’t really talk to each other. When your inventory, purchasing, and finance numbers don’t line up in one place, every new tariff turns into a scramble instead of a quick adjustment.
Q: Your research found that 53% of decision-makers are spending more time reacting to trade policy than investing in long-term growth. What does that look like in practice, and what are the longer-term consequences for retailers?
A: We found that 53% of decision-makers are spending more time reacting to trade policy than investing in long-term growth. In practice that means the person who should be planning next year’s assortment or looking at a new market is stuck rebuilding cost models every time another tariff headline hits. The growth conversations turn into contingency conversations. And that adds up. A competitor dealing with less volatility, or one that just has a clearer view of its own operation, gets to spend those same hours on the actual business. We see the same pattern at DOSS: the teams that climb back out of firefighting and get back to driving the outcomes that grow the business are usually the ones who hold their ground.
Q: The study shows that many companies are absorbing costs while others are passing them on to consumers. What factors determine which approach a retailer takes, and how sustainable are those strategies?
A: It mostly comes down to pricing power. Retailers with brand loyalty can raise prices without losing customers. The ones competing mainly on price tend to eat the cost, because a price increase just sends shoppers to a competitor. But there’s something underneath that decision a lot of people miss, which is whether the retailer actually knows its true landed cost and contribution margin by SKU and by channel, in real time. Many of them don’t. Their cost data sits in separate systems and only comes together in a delayed fashion at month-end. If you can’t tell which products are losing money, you end up absorbing costs across the whole catalog. And absorbing only works for so long. Eventually the margin pressure shows up as layoffs, reduced investment, or cheaper products, and none of that holds up when the rules keep changing.
Q: Inventory management appears to be under significant pressure, with companies holding excess inventory and accelerating purchases. How are retailers balancing the risk of overstocking against the uncertainty of future tariff changes?
A: Hold too much and you’ve got cash and warehouse space locked up in a product you might have to mark down later. Hold too little and you’re exposed to a stockout if tariffs jump before your next order lands. So retailers are hedging. They’re buying ahead on the core SKUs they’re confident about and easing off on the discretionary stuff, where a bad call costs more. What really separates the teams that are world-class is that they are working from live numbers instead of guessing at month-end. If you can see your days of inventory, the cash tied up in stock, and where your reorder points sit as they move, you can make the call on purpose. If you’re piecing it together from spreadsheets after the fact, you’re guessing, and expose your working capital to risk.
Q: Given the ongoing unpredictability of U.S.-Canada trade policy, what capabilities or strategies will distinguish retailers that adapt successfully from those that continue to struggle?
A: The retailers who come out ahead will be the ones who can see their costs and their supply chain in real time, not once a quarter. If you’re waiting for the next earnings cycle to understand your tariff exposure, you’re working off old information. Diversifying your supply base helps, but speed is what really matters here. Can you model a new tariff scenario and act on it in days rather than weeks? And knowing what to do isn’t enough on its own. The retailers who win can push the change through purchasing, inventory, and pricing without it getting stuck in a dozen manual handoffs. That’s what we focus on at DOSS: getting retailers off systems that just tell them what already happened, and onto an operation that can respond while it still matters. The ones planning on an annual cycle while policy shifts every month are going to keep falling behind.
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