As the U.S.-China trade war continues, many in the product development world are wondering how to best proceed. Should product developers start looking elsewhere for manufacturing? Should they plan for higher supply costs? How might this affect their product’s overall chances of success?

While there are still many unknowns as to how the tariffs will ultimately affect global product development, there are certain steps companies can take to minimize any negative effects.

Start with the big picture

Before committing to any drastic changes, companies should examine data regarding their business’s use of imports. This information is free to access from the Automated Commercial Environment system (ACE). By analyzing the import data, your company can better understand how the tariffs will specifically affect you.

Next, we recommend companies look into the Harmonized Tariff Schedule (HTS). The HTS categorizes all U.S. imports through a code system. Every product and import has a code that confirms the merchandise’s country of origin. This is important because items that are shipped from China do not necessarily originate from there.

Find supply chains and manufacturers outside the country

Finding diverse suppliers and manufacturers outside of China is a good idea regardless of the trade climate. Companies that can strategically maneuver within the global marketplace can minimize the effects of natural disasters, geopolitical turmoil, and economic upheaval to their supply chains.

Syracuse University economist Mary Lovely told NPR, “Businesses aren’t seeing the trade conflict calm down. They’re actually probably seeing it escalate. So this may be the time that firms actually say, hey, this is going to be around for quite a while, and maybe it’s the time for us to start making the investments that we need.”

Last month, the CEO of Brooks Running announced they are responding to the tariffs by moving production out of China and into Vietnam. India too has a “large, untapped population that would like to be more deeply embedded into global value chains—they will be able to come online and gradually get the capacity to replicate what China had done.”

Turn to smaller domestic manufacturers

Domestic manufacturers also have their advantages. Greater IP security, flexible payment options, and reduced shipping costs are just a few. U.S. manufacturers also tend to have high labor standards, which help contribute to the positive image that is already associated with domestic companies.

There are also many benefits to working with a manufacturer that’s on the smaller side. Smaller manufacturers can avoid the regulatory costs that often hit large manufacturers. The current trade climate is rendering agility vitally important, and small manufacturers are much better prepared to make the necessary, quick changes.

U.S. consumer-goods companies that are currently trying to move away from China-based manufacturing facilities have options. After all, some of the challenges resulting from China tariffs can translate to competitive advantages for American businesses.

At Pivot International, we’re helping U.S. companies successfully navigate the current trade climate. As a single-source designing, engineering, and manufacturing company with facilities in Taiwan, Manila, the UK, and the United States, we bring nearly 50 years of experience with Asian manufacturing and expertise to optimize production for your business. If your company is currently confronting production liabilities and is seeking a viable alternative to your current supplier, contact us today.