CSCMP’s 2023 Distinguished Service Award winner Ted Stank has made a name for himself through forming strong partnerships between academia and practitioners.
This year’s CSCMP 2023 Distinguished Service Award[remove all caps and bold] (DSA) winner, Dr. Ted Stank, is highly revered by his colleagues, particularly for his ability to move with ease between academic and practitioner circles. Stank is constantly listening to the ideas and concerns of both communities—and using that information to direct his research at the University of Tennessee-Knoxville (UTK). In fact, many of his colleagues refer to him as a “practical academic.”
Under Dr. Stank’s guidance, the University of Tennessee has become one of the premier supply chain programs in the world at both the undergraduate and post graduate levels. He’s responsible for setting the priorities, tone, and culture for UTK’s program.
Stank currently serves as the Harry and Vivienne Bruce Chair of Excellence in Business and Professor of Supply Chain Management, co-faculty director of the Global Supply Chain Institute, Haslam Family Faculty Research Fellow, and founder and faculty director of the Advanced Supply Chain Collaborative at the University of Tennessee-Knoxville.
Under his leadership, the university’s Global Supply Chain Institute has become a hub for supply chain thought leadership and talent development, with involvement from companies like Amazon, Boeing, Procter & Gamble, and Walmart. The Advanced Supply Chain Collaborative has enabled these and other corporate giants, such as IBM and Pfizer, to leverage academic knowledge and advanced innovations to improve lives around the world.
Recently, he spoke with CSCMP’s Supply Chain Quarterly Managing Editor Diane Rand about his work.
NAME: Theodore (Ted) Stank
TITLE: Harry and Vivienne Bruce Chair of Excellence in Business and Professor of Supply Chain Management; Co-Executive Director of the Global Supply Chain Institute; Haslam Family Faculty Research Fellow; and Founder and Faculty Director of the Advanced Supply Chain Collaborative at the University of Tennessee-Knoxville
OTHER EXPERIENCE: Operations officer in the United States Navy; sales and marketing experience for Abbott Laboratories Diagnostic Division; consulted for numerous organizations, including Anheuser-Busch InBev, Dell, IBM, Lowe’s, Norfolk Southern, OfficeMax, Pepsi, Siemens, Sony, Textron, Walgreens, Walmart, Whirlpool, and the U.S. Air Force and Marine Corps.; educational advisor to the Health and Personal Care Logistics Conference; associate editor for the Journal of Business Logistics; and serves on the editorial review boards of Journal of Operations Management and International Journal of Physical Distribution and Logistics Management.
CSCMP EXPERIENCE: served as president of the old Paso del Norte Roundtable; session chair and track chair of the EDGE annual conference; led special task forces for the board; and served as board officer and the chairman of the board of directors
AWARDS: 2023 CSCMP Distinguished Service Award; member of CSCMP’s Supply Chain Hall of Fame
EDUCATION: doctorate in marketing and distribution from the University of Georgia; master’s in business administration from Webster University; and a bachelor’s degree from the United States Naval Academy
You started your career in the Navy and then moved into industry. Why did you eventually decide to go into academia?
After leaving the Navy, mainly due to a desire for better work/family balance, I became a sales rep for Abbott Labs Diagnostic Division (ADD). During the time I was with ADD, the marketing organization created a strategy of competing not just on our product lines but on the distribution intensity we had that enabled us to deliver to our customers. … I was not cut out for sales—not thick-skinned enough—and began searching for something else. A great Navy friend of mine (Bill Simon, who went on to become CEO of Walmart North America) sent me a Wall Street Journal article outlining the opportunities that were opening for business professors. We both decided to quit our jobs and get our PhDs together (he was working as a third shift plant manager for RJR at the time) and become business professors. I did, and he didn’t. He now owns racehorses, and I am still working.
But I don’t regret my career; it has been great professionally and also allowed me to coach my kids in sports up through high school, play in a rock and roll band, and do a lot of other things I could not have done without the work flexibility that an academic career afforded me. Interestingly, that flexibility is what millennials and Gen Zers are seeking with their work/life integration today, and good for them.
Your academic career has been very focused on developing strong partnerships with industry and focusing on research that produces industry best practices. Why is that so important to you?
I have been influenced by some giants in our field, starting with my dissertation chair, Dr. Patricia Daugherty, and continuing with Dr. Don Bowersox and Dr. Tom Mentzer. All believed that business professors needed to be closely aligned with our industry practitioners. We are not medieval language professors, but professors of a practice, just like in medicine, nursing, law, and engineering.
One of my huge “ah-ha” moments was hearing Dr. Bud La Londe during a presentation to a group of academics when a finance professor challenged him about how much time he spent working with industry. Bud’s response was that no one would challenge a physics professor about spending time in their lab, why would you challenge a business professor from spending time in our lab (that is, the business world)?
Don, Pat, and Tom all enforced the notion that our research must be theoretically and methodologically sound and rigorous, but also practically relevant. It pains me that our academic model has moved increasingly away from that model, and I have spent the latter part of my career trying to bring us back. I am extremely proud that our program at the University of Tennessee (UT), more than any other program in my opinion other than MIT, embodies that notion of rigor and relevance. I think it has proven out in the success of our programs and the recognition we have in rankings, etc.
The results from the research I participate in today as part of our Advanced Supply Chain Collaborative at UT have been implemented by the companies we work with and published in top supply chain management (SCM) academic journals. Three of my close colleagues, Dr. Tom Goldsby, Dr. Lance Saunders, and my last doctoral student, Dr. Anne Dohmen, now on faculty at Michigan State University, embody this notion and I could not be prouder of them. They will be continuing to push this philosophy long after I am gone.
What advice do you give academics on how to best form partnerships with practitioners?
What works is getting out to where practitioners are—conferences, their workplaces, etc.—and getting to know their struggles and challenges. And to get to know them as people, because academic-industry partnerships are all about relationships. Sharing a dinner or drink with our colleagues in industry goes light years toward building trust in each other that results in working relationships. By the way, those relationships start when you have talented students in class. If you do a good job there and show them that you are interested in helping them succeed, and then keep up with some of them afterwards, they will open doors for you in the future.
What does not work is cold-calling industry folks and asking them to give you data when they know nothing about you and have no trust. So, like so many things in business and personal life, it’s all about the relationships. CSCMP, by the way, can be impactful in helping establish those relationships, first at the local roundtable level and also at the annual conference. Many great academic-practitioner relationships start at dinner at the local roundtable meetings.
When we started the Advanced Supply Chain Collaborative to do joint academic-industry research, I told the 12 CSCOs who took the risk to participate with us that first year that I staked my reputation and relationship with them on this idea creating value. Those folks put their trust, time, and money on us, and they would not have if they did not have a close relationship with me in advance. I learned that from Don Bowersox.
Do you see any ways that CSCMP could help better foster collaboration between industry and academia?
My passion for CSCMP is that it remains the only professional organization in business that brings academics and industry practitioners together, and always has. … Other business disciplines, including our colleagues in operations management, marketing, finance, accounting, and management, all have professional organizations whose academics and practitioners meet separately at different times and in different places and never speak to each other. I consider that a shame and a travesty of what business scholarship is meant to be.
CSCMP could provide a key role in bringing like-minded academics and practitioners to the table to engage in collaborative research. Academics have the research skills and bandwidth to take on some of the challenging issues that all SCM leaders are confronted with. Dick Powell, a Council of Logistics Management (CLM) chair back in the late ‘90’s, once said that the role of academia is to separate truth from hype. I heard him present that at an annual global conference, and I internalized that message.
A lot of your work at the University of Tennessee has focused on integrated supply chain management. What gains have you seen over the years, and where is progress still needed?
As I work with our various industry partners, I have been encouraged to find that most of them are somewhere on the journey to integrated supply chains. This is a big difference from 10 years ago. Three things have helped make considerable changes in the last 10 years:
Organizing the supply chain functions under a chief supply chain officer (CSCO) has put all the internal functions in a hierarchy that encourages integration. In many of these integrated supply chain organizations, a big part of the organization is the creation of overarching metrics that have incented behaviors that lend to integrated decision-making.
Implementation of effective integrated business planning/sales and operations planning/demand-supply integration—whichever you choose to call it—has also contributed greatly to this end-to-end perspective in decision-making.
Technology—including cloud technology, advanced planning packages, analytics, and visibility tools and information control towers—across the supply chain have helped us gain a much better view of what is going on not only within the organization but also up and down the extended supply chain.
Progress still needs to be made in all three of these areas, although the lessons we learned during the COVID pandemic have accelerated progress—for now. It is easy for companies to backslide into old behaviors, and my CSCO friends tell me that is indeed happening. Old habits die hard, and keeping the attention of senior business leaders is a hard thing to do as they shift to the latest shiny object in their view.
How have the skills that companies have been looking for from your graduates changed since you started in academia?
The biggest change has been that companies are looking for students who have a broad end-to-end knowledge of supply chain functions but also enough depth to succeed in their first job, which will be in one of those functions. That’s a tough challenge as the content of SCM broadens constantly. The other big thing is a consistent demand for analytics skills, the more the better. Our biggest combination is an SCM major with a business analytics minor—and vice versa for analysts going to work in SCM.
What continues to keep you engaged in supply chain management?
Wow, it just changes constantly. We have just come through a period of time with COVID that has shaken our notions of business, and global business in particular, to the core, and we are still in reaction mode to what that did to us. Combine that with geopolitical upheaval, both abroad and here in the U.S., and things look very different than they did just five years ago. The assumptions we made during the first 30 years of my career have been challenged, and we are trying to figure out what comes next. If that doesn’t pique your interest, then nothing will.
A lot of my current research relates to those big trends—what do new global networks look like? How do we focus more on true agility in our supply chains instead of paying it lip service? Can we make supply chain risk management a core capability instead of also just paying it lip service? How can we dramatically change how we do things to take advantage of the information we have at our fingertips, particularly in planning, but also across all supply chain functions? How can we as supply chain leaders make the biggest impact on sustainability?
I won’t be around to figure all this out, but our teams at UT are working on all of these issues and will really be making a mark on knowledge and practice in the years to come.
What has been one of your proudest professional achievements?
Other than winning the CSCMP Distinguished Service Award and being accepted into the Supply Chain Hall of Fame? My proudest achievements are following my students as they move on to their careers and hearing from them how they applied what they learned from me and made a difference in their organizations. I have a file of the emails I get from them, and at the end of the day, the most meaningful thing for me is having a positive impact on the people with whom I work—from my colleagues to the companies I work with—and to all of my students from undergrads to executives.
I hear a lot from my top-performing students, but here is one of my favorite messages from a former student: “Even though I wasn't the most serious student, and earned a 2.5, what I learned helped me to get a job. I had an interview today with the operations manager, production manager, and the engineering guy, and I was able to answer their questions pretty well. I have to say, a lot of that was because of stuff I learned from your class.”
Geopolitical rivalries, alliances, and aspirations are rewiring the global economy—and the imposition of new tariffs on foreign imports by the U.S. will accelerate that process, according to an analysis by Boston Consulting Group (BCG).
Without a broad increase in tariffs, world trade in goods will keep growing at an average of 2.9% annually for the next eight years, the firm forecasts in its report, “Great Powers, Geopolitics, and the Future of Trade.” But the routes goods travel will change markedly as North America reduces its dependence on China and China builds up its links with the Global South, which is cementing its power in the global trade map.
“Global trade is set to top $29 trillion by 2033, but the routes these goods will travel is changing at a remarkable pace,” Aparna Bharadwaj, managing director and partner at BCG, said in a release. “Trade lanes were already shifting from historical patterns and looming US tariffs will accelerate this. Navigating these new dynamics will be critical for any global business.”
To understand those changes, BCG modeled the direct impact of the 60/25/20 scenario (60% tariff on Chinese goods, a 25% on goods from Canada and Mexico, and a 20% on imports from all other countries). The results show that the tariffs would add $640 billion to the cost of importing goods from the top ten U.S. import nations, based on 2023 levels, unless alternative sources or suppliers are found.
In terms of product categories imported by the U.S., the greatest impact would be on imported auto parts and automotive vehicles, which would primarily affect trade with Mexico, the EU, and Japan. Consumer electronics, electrical machinery, and fashion goods would be most affected by higher tariffs on Chinese goods. Specifically, the report forecasts that a 60% tariff rate would add $61 billion to cost of importing consumer electronics products from China into the U.S.
We are in the golden age of warehouse automation. Supply chain leaders today have a dizzying array of new automated solutions to choose from. These include autonomous mobile robots (AMRs), automated storage and retrieval systems (AS/RS), automated case-handling mobile robots, robotic pickers, and advanced software. While predominantly manual facilities remain, advancements in automation are improving existing facilities and use cases demonstrate in very real ways how robotics will forever alter supply chains.
But while the potential gains from automation can be significant, it’s also important to realize that no two organizations’ needs are the same. There is no cookie cutter approach to warehouse automation and robotics. A successful implementation requires not only strategic planning and investment but also a full understanding of the organization’s own unique needs. Before it installs any automation, a company must have a clear picture of its specific processes and requirements and ensure solutions are tailored to its operations. This involves identifying the needs of the specific sector or market segment that the company is trying to serve, what its growth potential is, and where it currently is in its automation journey.
To show how this can be done, let’s take a closer look at the retail industry. Today’s retail distribution centers are some of the most advanced materials handling facilities ever built, simultaneously supporting fulfillment for online purchases and enabling the efficient stocking of brick-and-mortar stores. These facilities demonstrate the impact automation and robotics advancements can have on distribution operations, including enabling unprecedented performance and throughput levels that were unimaginable a few short years ago. For this reason, reviewing the strategic considerations a retailer may face on the way to making a business case for automation will provide a model not just for other retailers but for companies in other industries as well.
Tackling long-standing challenges
Warehouse robotics and automation can help retailers respond to a variety of longstanding challenges. First, there is the growth of e-commerce. The volume of online purchases continues to increase, even as the rate of growth slows to pre-pandemic norms. According to the U.S. Department of Commerce, despite ongoing inflationary forces, American consumers spent more than $300 billion online in the third quarter of 2024, which represented 16.2% of total retail sales and a 7.4% percent increase over the same period in 2023.
Each online purchase is essentially an ad hoc event, making the resulting fulfillment more complex and demanding than the regular, scheduled replenishment of in-store inventories. Automation plays a vital role in helping retailers overcome these challenges. By automating key processes, retailers can achieve faster throughput, can more efficiently handle a larger variety of stock-keeping units (SKUs), and can maintain exceptional order accuracy. Automated systems streamline order picking, packing, and shipping, reducing errors and speeding up operations. This allows retailers to keep up with the growing demands of e-commerce while ensuring customer satisfaction with precise and timely deliveries.
Then there is the issue of labor. Retail supply chain leaders face an ongoing and problematic shortage of workers. While the “2024 State of Warehouse Labor Report” from the online labor marketplace Instawork found some improvement in the labor market, more than 40% of surveyed businesses still reported that warehouse staffing levels remain a cause of revenue loss.
The implementation of automation and robotics in both existing brownfield and new greenfield warehouses is a direct response to these labor market concerns. All forms of warehouse automation, including robotics, are fundamentally efforts to address the shortage of labor or to increase its efficiency. For example, many automated solutions, such as AMRs, are designed to specifically address the most time-consuming activity in warehouses: the 78% of time employees spend walking.
There are other important benefits. Machines don’t require rest, and they are particularly effective at highly repetitive tasks, which are a leading cause of workplace injuries. Automation also creates new career paths for employees, transitioning them away from physically taxing activities that center on moving items through the warehouse to maintaining and overseeing the systems that assume those tasks. Finally, as the cost of labor rises, the cost of technology continues to decrease.
Implementation: Where to begin?
Automated storage and retrieval systems (AS/RS) provides advanced storage capabilities and fast throughput. But they are typically more costly and take longer to implement than less automated systems.
Courtesy of Vanderlande
While the benefits of automation are clear, selecting the right solution for a specific operation can be daunting. To choose among the variety of automated solutions available, retail supply chain leaders must first consider the needs of their specific sector.
The grocery and food sector is a telling example. Few sectors have experienced as rapid a transformation in recent years as the grocery industry. Before the pandemic, online grocery sales were mostly limited to select metropolitan areas. Last year, online grocery sales in the U.S. reached $95.8 billion, according to the data and technology company Mercatus. Consumer grocery purchases are now split between three very distinct fulfillment models: ship-to-home, delivery, and pick-at-store. Those models and the retailer’s unique needs determine the type of warehouses required. As a result, the grocery sector sees everything from full standalone distribution centers to warehouse operations at the “back of the store” and even so–called dark stores—stores that are solely used as warehouses for online orders and are not open to the public.
Due to razor-thin margins and price-sensitive shoppers, the grocery sector is embracing advanced automation, such as AS/RS and palletizing robots. For example, they are utilizing software and automation to build pallets and pallet cages in a stable and space-efficient fashion with products arranged by store layout. By doing so, leading grocers and food retailers ensure that they can quickly move and stock items while keeping labor costs in check—all savings that enable them to maintain margins while competing on price.
Different considerations, however, are the main focus for automation projects in the apparel and general merchandising industries. In apparel, items need to be moved—typically in bags—without being damaged. Additionally, warehouses often have to manage the processing of returns. In both applications, pocket sorters are often used. In contrast, the general merchandise sector deals with highly variable SKUs and the rapid processing of online orders, making throughput levels and order accuracy critically important. Here, a high-performance AS/RS is often a natural choice.
Build new or sweat your existing warehouse assets?
Automated case-handling mobile robots are a good solution for companies looking for more "incremental" automation. Because they can use existing warehouse racks, they can be implemented faster than a more complex system.
Courtesy of Vanderlande
Where retailers are in their growth cycle and in their warehouse automation journey should also be carefully considered when determining what kinds of automation and robots are needed. These two factors will play a particularly strong role in determining whether a retailer implements new automation or sticks with what it already has. This is particularly true today when the cost of capital is a key consideration. As an example, let’s look at how this decision might play out in different retail sectors.
Fast-growing, mid-market retailers: Most of these organizations currently have largely manual distribution centers. They are predominantly moving to build more advanced, fully automated facilities that include AMRs, AS/RS, and robotic pickers. Primed for growth, they are foregoing the improvement of existing warehouses, as even modernization projects can't keep up with growing sales and risk becoming quickly obsolete.
Slower growing mid-market retailers: These companies are embracing more incremental automation. For example, many are deploying a system that includes automated case-handling mobile robots (ACRs). These robotic units are designed to move and retrieve goods stored in traditional, often pre-existing, warehouse racks. As a result, these systems can often be implemented in just a couple of months, offering a faster implementation timeline.
Other mid-market retailers are choosing to implement an AS/RS, which—while automating many of the same tasks—provides more advanced storage capabilities and faster throughput. These systems are, however, more costly and require a more comprehensive planning and installation process, as they can take a year or two to design and make operational.
The largest retail brands: These companies already rely on largely automated warehouses that utilize AS/RS, robotic pickers, and other solutions. They are increasingly choosing to “sweat their assets” by making incremental improvements—such as adding additional shuttles and more storage capacity to an already existing AS/RS or deploying additional robotic pickers to speed throughput. Such improvements can result in significant efficiency gains, without requiring any large capital investments.
No matter what type of automation is selected, however, successful implementation hinges on a crucially important step: creating an effective business case.
The crucially important business case
Before implementing any automation or robotic solution, a company must perform due diligence. It is critical that no project should proceed without first completing a detailed business case. There are several factors to consider, starting with the decision between modernizing an existing brownfield facility or building a new greenfield site. This choice requires evaluating the costs, growth potential, and the return on investment (ROI) associated with a more advanced warehouse system.
Importantly, the business case should not be created in a vacuum. Operational, financial, and legal leaders should all be involved. The process should be sure to incorporate the following steps:
Determine growth projections: No one has a crystal ball, but growth projections and plans should be carefully considered to determine if a new greenfield facility with advanced automation and robotics is viable and necessary. These cutting-edge solutions often deliver the highest ROI but come with significant upfront investment.
Determine the lifecycle of existing warehouses: Are they able to process the number of SKUs, achieve the throughput, and provide the storage capacity needed today? What about for the future? If not, can they be modernized to cost-effectively buy more time?
Calculate the timeframe needed to realize an ROI: How long will it take to achieve the ROI for your automation project over the cost of capital and labor that would be required in its absence? How does this compare to the lifespan of the facility or project in question? Are you looking to see your ROI in three years, five years, or ten? The time required to achieve the desired ROI is key.
Consider the costs and gains associated with incremental advancements: Even if it seems like a new, fully automated facility makes the most sense, consider the alternative approach of making incremental improvements. If you choose to move forward with a greenfield project, it is good to know you carefully considered existing assets.
Run the numbers on your dream warehouse: Even if a new facility that delivers the capabilities of high-performance robots and automation is likely out of reach, run the numbers anyway. It can feel safer to upgrade a warehouse than to build a new automated one, but no one wants to invest significant capital in a facility that hinders growth in the future.
Remember that no automation is automatic: Advanced solutions and robots are never a one-and-done purchase. They must be maintained and managed—tasks that require significant expertise, either from partners or through an investment in employees and training.
By carefully considering the needs and nuances that define success in their sector and creating a detailed business case, supply chain leaders can embrace emerging, powerful robotics and automation with confidence. Regardless of whether they choose to obtain the most advanced capabilities or take a more measured approach, they will do so with the confidence that their investments are based on proven strategies that position them for growth and success in the future.
About the authors: Jake Heldenberg is the director of North American Warehouse Sales Engineering, at Vanderlande. He oversees the design of warehouse systems that combine intelligent software, robotics, and advanced automation. Andy Lockhart is the director of strategic engagement, warehouse solutions, North America, at Vanderlande, where he provides retail customers with innovative, scalable systems; intelligent software; and reliable services to optimize distribution and fulfillment operations.
Shippers are actively preparing for changes in tariffs and trade policy through steps like analyzing their existing customs data, identifying alternative suppliers, and re-evaluating their cross-border strategies, according to research from logistics provider C.H. Robinson.
They are acting now because survey results show that shippers say the top risk to their supply chains in 2025 is changes in tariffs and trade policy. And nearly 50% say the uncertainty around tariffs and trade policy is already a pain point for them today, the Eden Prairie, Minnesota-based company said.
In a move to answer those concerns, C.H. Robinson says it has been working with its clients by running risk scenarios, building and implementing contingency plans, engineering and executing tariff solutions, and increasing supply chain diversification and agility.
“Having visibility into your full supply chain is no longer a nice-to-have. In 2025, visibility is a competitive differentiator and shippers without the technology and expertise to support real-time data and insights, contingency planning, and quick action will face increased supply chain risks,” Jordan Kass, President of C.H. Robinson Managed Solutions, said in a release.
The company’s survey showed that shippers say the top five ways they are planning for those risks: identifying where they can switch sourcing to save money, analyzing customs data, evaluating cross-border strategies, running risk scenarios, and lowering their dependence on Chinese imports.
President of C.H. Robinson Global Forwarding, Mike Short, said: “In today’s uncertain shipping environment, shippers are looking for ways to reduce their susceptibility to events that impact logistics but are out of their control. By diversifying their supply chains, getting access to the latest information and having a global supply chain partner able to flex with their needs at a moment’s notice, shippers can gain something they don’t always have when disruptions and policy changes occur - options.”
That strategy is described by RILA President Brian Dodge in a document titled “2025 Retail Public Policy Agenda,” which begins by describing leading retailers as “dynamic and multifaceted businesses that begin on Main Street and stretch across the world to bring high value and affordable consumer goods to American families.”
RILA says its policy priorities support that membership in four ways:
Investing in people. Retail is for everyone; the place for a first job, 2nd chance, third act, or a side hustle – the retail workforce represents the American workforce.
Ensuring a safe, sustainable future. RILA is working with lawmakers to help shape policies that protect our customers and meet expectations regarding environmental concerns.
Leading in the community. Retail is more than a store; we are an integral part of the fabric of our communities.
“As Congress and the Trump administration move forward to adopt policies that reduce regulatory burdens, create economic growth, and bring value to American families, understanding how such policies will impact retailers and the communities we serve is imperative,” Dodge said. “RILA and its member companies look forward to collaborating with policymakers to provide industry-specific insights and data to help shape any policies under consideration.”
As the Trump Administration threatens new steps in a growing trade war, U.S. manufacturers and retailers are calling for a ceasefire, saying the crossfire caused by the new tax hikes on American businesses will raise prices for consumers and possibly trigger rising inflation.
Tariffs are taxes charged by a country on its own businesses that import goods from other nations. Until they can invest in long-term alternatives like building new factories or finding new trading partners, companies must either take those additional tax duties out of their profit margins or pass them on to consumers as higher prices.
The Trump Administration on Thursday announced it may impose “reciprocal tariffs” on any country that currently holds tariffs on the import of U.S. goods. That step followed earlier threats to apply tariffs on the import of steel and aluminum beginning March 12, another plan to charge tariffs on the import of materials from Canada and Mexico—now postponed until early March—and new round of tariffs on imports from China including a 10% blanket increase and the elimination of the “de minimis” exception for individual items under a value of $800 each.
Various industry groups say that while the Administration may have legitimate goals in ramping up a trade war—such as lowering foreign tariff and non-tariff trade barriers—applying a strategy of hiking tariffs on imports coming into America would inflict economic harm on U.S. businesses and consumers.
“This tariff-heavy approach continues to gamble with our economic prosperity and is based on incomplete thinking about the vital role ethical and fairly traded imports play in the prosperity,” Steve Lamar, president and CEO of The American Apparel & Footwear Association (AAFA) said in a release. “Putting America first means ensuring predictability for American businesses that create U.S. jobs; affordable options for American consumers who power our economy; opportunities for farmers who feed our families; and support for tens of millions of U.S. workers whose trade dependent jobs make our factories, our stores, our warehouses, and our offices function. Sweeping new tariffs — a possible outcome of this exercise — instead puts America last, raising costs for American manufacturers for critical inputs and materials, closing key markets for American farmers, and raising prices for hardworking American families.”
A similar message came from the National Retail Federation (NRF), whose executive vice president of government relations, David French, said: “While we support the president’s efforts to reduce trade barriers and imbalances, this scale of undertaking is massive and will be extremely disruptive to our supply chains. It will likely result in higher prices for hardworking American families and will erode household spending power. We encourage the president to seek coordination and collaboration with our trading partners and bring stability to our supply chains and family budgets.”
The logistics tech firm Körber Supply Chain Software has a common position. "The imposition of new tariffs, or the suspension of tariffs, introduces substantial challenges for businesses dependent on international supply chains. Industries such as automotive and electronics, which rely heavily on cross-border trade with Mexico and Canada, are particularly vulnerable,” Steve Blough, Chief Strategist at Körber Supply Chain Software, said in an emailed statement. “Supply chains that are doing low-value ecommerce deliveries will have their business model thrown into complete disarray. The increased costs due to tariffs, or the increased costs in processing time due to suspensions, may lead to higher consumer prices and processing times.”
And further opposition to the strategy came from the California-based IT consulting firm Bristlecone. “Tariffs or the potential for tariffs increase uncertainty throughout the supply chain, potentially stalling deals, impacting the sourcing of raw materials, and prompting higher prices for consumers,” Jen Chew, Bristlecone’s VP of Solutions & Consulting, said in a statement. “Tariffs and other protectionist economic policies reflect an overarching trend away from global sourcing and toward local sourcing and production. However, despite the perceived benefits of local operations, some resources and capabilities may simply not be available locally, prompting manufacturers to continue operations overseas, even if it means paying steep tariffs.”