PROCUREMENT 101

Do You Know the Impact Tariffs Will Have on Your Business?

With continued uncertainty around the use of tariffs impacting key goods and trade partners, many North American organizations are feeling the ripple effects across their supply chains and procurement operations. Tariffs are no longer a one-time concern — they’re a variable that must be actively managed. 

If you’re not sure how tariffs will impact your costs, contracts, or sourcing decisions, it’s time to evaluate the tools and processes you rely on to stay agile. A modern Source-to-Pay (S2P) solution can help organizations like yours analyze, adapt, and act in response to tariff changes — before your margins take a hit. 

There are several practical methods procurement teams can use to assess spend data for tariff impact: 

Commodity-Level Spend Classification

Organizing spend by commodity codes such as Harmonized System (HS) codes allows organizations to pinpoint which goods are subject to tariffs and identify high-risk categories. This classification forms the basis for aligning procurement data with customs regulations.

Supplier & County-of-Origin Mapping

Enhancing supplier records with country-of-origin and manufacturing location data helps identify where exposure is concentrated. This mapping supports better supplier segmentation and risk profiling across your supply base.

Customs Code Integration & Harmonization

Integrating customs codes into item masters and procurement records enables consistent, cross-functional reporting between sourcing, compliance, and finance. Harmonized data is essential for accurate tariff analysis and reporting.

Dynamic Reporting & Scenario Modeling

Configurable dashboards and scenario-planning tools within leading S2P platforms can help simulate the financial impact of various tariff changes. This allows teams to model different sourcing options and cost projections based on real-time data.

Contract Linkage & Terms Analysis

Linking sourcing data with contract terms enables organizations to assess flexibility in current agreements — such as clauses covering cost pass-through, renegotiation rights, or indexed pricing that may be impacted by tariffs.

To successfully apply these methods, organizations need more than just tools — they need expert guidance to align data structures, configure platforms, and translate insights into action. Our team works with clients to lead the following: 

Spend Diagnostic Workshop:

Breakdown high-level categories and map them to tariff-affected goods and services. 

Supplier Exposure Review:

Analyze location-based risk using enriched supplier master data.

Contract Impact Assessment:

Evaluate how existing agreements could absorb, share, or escalate tariff costs.

Scenario Planning Session:

Help procurement leaders simulate and model different sourcing strategies in response to tariff shifts.

Data Readiness Audit:

Ensure that item, supplier, and contract data are clean, complete, and aligned for analysis.

These exercises help teams not only assess their current exposure but also build the repeatable processes and reporting structures needed to monitor tariff risk going forward. With the right foundation in place, organizations can move from reactive to resilient — ready to anticipate changes, protect margins, and make smarter sourcing decisions in this new environment. 

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