How ERM is Helping Firms Future-Proof Supply Chains
ERM combines more than 50 years of expertise in environmental, health, safety, risk and social consulting with a clear mission to help the world’s leading organisations adapt and thrive through disruption.
The consultancy’s approach is built on collaboration, accountability and technical excellence. Partners at ERM lead teams across more than 40 countries, supporting clients as trusted advisors.
Today, one major concern for many of those clients is trade tariffs. These levies, often introduced with little notice, have a ripple effect across complex global supply chains. In a blog post, ERM explores how businesses can prepare for such disruption—starting now.
Short-term responses to tariff disruption
Jon Hughes, Consulting Partner for EMEA, Olaf Schatteman, Global Service Leader (Sustainable Products and Supply Chain), and Jason Smith, Regional Service Leader (Sustainable Product & Supply Chain), who co-authored the blog post, begin with practical short-term strategies for dealing with tariffs.
One of the clearest measures is to frontload inventories, as they explain: "Given the 90-day pause on most new tariffs announced by the Trump administration in April 2025, there may be a window for importers to accelerate shipments and stockpile goods at lower cost."
Holding extra stock comes with higher carrying costs and ties up capital, but it can help insulate businesses from immediate price hikes.
"Businesses can work collaboratively with suppliers, manufacturers and distributors to share the pain tariffs bring," ERM also suggests.
This might involve renegotiating existing contracts or establishing cost-sharing agreements. The goal is to avoid bearing all the increased costs alone.
A further strategy is to diversify suppliers, especially when tariffs affect goods from specific countries. ERM notes: "Where tariffs are country-specific, shifting procurement to suppliers in other nations - whether in Southeast Asia, Eastern Europe or Latin America - can provide immediate or partial relief."
While not always straightforward due to quality standards, regulatory compliance or supplier capacity, even a partial change in sourcing can help.
Investing in long-term supply chain resilience
While the short-term measures provide breathing room, ERM’s focus is on encouraging businesses to plan beyond immediate shocks. Their central argument is that supply chains need to be both sustainable and resilient.
The most promising long-term strategy, they suggest, lies in adopting circular supply chains.
In one LinkedIn post, Jon asserts: "Businesses need both a short term tactical response and a long term strategy to build more circular, responsible and resilient supply chains to thrive in the volatile, uncertain global economy."
Circular systems aim to minimise waste, reuse materials and extend product life cycles.
As the blog explains: "By designing products for reuse, remanufacturing and recycling, companies can reduce dependence on raw material imports that may be subject to tariffs or scarcity."
Circular models are also naturally aligned with reshoring and nearshoring efforts. Bringing production closer to the point of sale can cut shipping costs, improve responsiveness and avoid geopolitical disruptions.
"Shorter supply chains also reduce lead times, transportation costs and exposure to geopolitical risks," ERM adds.
Labour and unit costs may be higher in domestic or regional markets, but technological advancements can help to offset this. Tools such as robotics, additive manufacturing and automation allow firms to remain competitive without relying on global-scale production.
- Build inventories ahead of deadlines
- Negotiate across the value chain
- Diversify and shift suppliers
- Adopt circular supply chains
Why sustainability is now a business imperative
The wider lesson from tariff volatility, ERM argues, is that global supply chains are are vulnerable.
As they put it: "Long, multi-tiered supply chains are inherently susceptible to disruptions... A single policy decision - such as a new tariff - can sharply increase costs and upend supplier relationships."
In this context, businesses must widen their focus.
"Businesses with global supply chains must move beyond a narrow focus on cost efficiency at the unit level under normal operating circumstances to embrace circularity, responsibility and resiliency as core principles," they conclude.
With supply chain disruption now a business norm, from pandemics to natural disasters and tariffs, ERM believes only those prepared to innovate and invest for the long haul will prosper.
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