We can say all day long that the traditional and completely valid strategy to weather disruption in sources of supply is redundancy and replacements. Nonetheless, there are only so much of a given item and a limited number of places where replacements can be obtained (think tomatoes and avocados, for example).
If you happen to be a big tomato or avocado user, you know the price you pay is passed on to consumers. The fast-casual restaurant chain Chipotle has already said it will be forced to raises prices if the U.S. makes good on threats to raise tariffs on Mexican produce by five percent this month (and 25 percent by year’s end). By the way, I hope Chipotle hasn’t been shy about telling customers coming in today what tomorrow may bring and who is responsible.
Our Suggestion: Rally Your Customers
Protect your brand. Make your stand with your customers and redirect them to the REAL culprit. The higher price is not your doing; it’s no more profit for you – just extra cost for you and your customers, in this case thanks to U.S. trade policy.
For some businesses, as prices increase (tariff driven or otherwise) some buyers fall away, while others may now become more attractive. Consistent and continuous defense of your brand and customers can mitigate the impact of surprises that inevitably occur.
There is no excuse for being in complete disarray when the core segments of your business are disrupted. Nothing lasts forever. When you have a customer-centered contingency in place, you can at least be prepared to execute your “Plan B” with little disruption to sales and operations.
If you’re responsible for marketing in a consumer goods or retail industry, how are you preparing for possible trade wars with China and Mexico?