Tariff-proof your financial strategy: Suggested CFO approaches

The latest wave of tariffs imposed by the US government is forcing businesses to rethink their financial strategies. With rising export costs affecting multiple industries, many companies are left with little choice but to pass on at least some of the impact to customers.

The tariff challenge: Navigating a shifting financial landscape

A recent survey from Gartner found that 30% of CFOs plan to pass nearly all (91–100%) of the tariff costs onto customers, while 29% expect to absorb at least 90% of the increase internally. On average, businesses anticipate transferring 73% of the tariff rise to their customers.

While hardly avoidable, this approach carries risks, like customer pushback, reduced demand, and competitive pressure could all impact long-term growth. CFOs must consider a balanced response, combining cost efficiencies, financial technology, and smarter pricing strategies.

Understanding cost structures before making pricing decisions

Before making any adjustments (including pricing) you need a clear view of business spending. But this is easier said than done. According to our recent CFO Agenda report, 85% of finance leaders cite spend visibility as a major challenge when managing multiple disconnected tools.

With tariffs adding another layer of complexity, a lack of spend and cash flow visibility makes it even harder to assess the true impact and make informed financial decisions.

My top three next steps:

• Use spend management software to track & reconcile all your company expenses across multiple entities so you have the most up-to-date info to compare to tariff-related costs
• Pinpoint cost-saving and supplier negotiation opportunities with custom categories and budgets within smart spend management software
• Conduct a detailed cost analysis to ensure price increases are targeted rather than across-the-board
• Improve cash flow forecasting to model different tariff scenarios and prepare for potential market shifts

Cutting costs without cutting quality

Many European businesses are under pressure to reduce costs, with 58% of CFOs reporting that they have already made or considered compromising customer experience to save money.

It’s a precarious balancing act. While rolling with change is vital, reducing quality or service levels could lead to customer dissatisfaction and long-term damage to brand reputation and success.

My top three next steps:

• Reassess supplier contracts to negotiate better terms, explore alternative suppliers, and consolidate purchases where possible
• Review non-essential spending. Scrutinise your subscriptions with smart software to weed out unused or duplicate recurring payments and tighten up your expense policies in the short term
• Lean on automation and AI-driven finance tools to improve efficiency and reduce administrative overheads

Smarter pricing strategies

Blanket price rises are risky. As mentioned above, you could damage customer relationships and market positioning for a very long time. Instead, consider data-driven pricing strategies to balance revenue and demand as much as possible.

My top three next steps:

• Use dynamic pricing models and adjust prices based on demand elasticity rather than applying uniform increases
• Restructure product and service offerings. Bundling or introducing premium tiers can help offset costs while maintaining value for customers
• Be transparent in new pricing communications when they become unavoidable. Clearly communicate the reason for any price rises to maintain trust

Collaboration is key: CFOs cannot work in silos

Finance is not an island. Managing the ongoing tariff impact will require cross-functional collaboration. However, according to the CFO Agenda report, 96% of finance leaders find “getting visibility over the rest of the business to understand how other departments operate a ‘very significant’ challenge.”

My top three next steps:

• Work with procurement teams to explore tariff mitigation strategies, such as diversifying supply chains or renegotiating terms
• Engage with sales and marketing to ensure pricing adjustments are positioned in a way that minimises customer churn
• Collaborate with operations to identify efficiencies in logistics, production, or distribution that could offset rising costs. Make sure your spend processes and operations are fully and directly integrated via your ERP (NetSuite, Sage Intacct, Microsoft Dynamics 365 Finance, etc) so the info you need is as up-to-date as possible

Finance technology as a strategic advantage

In today's volatile trade environment, you must be able to quickly analyse changes and impacts and adapt financial strategies with real agility for a critical competitive edge.

While 61% of CFOs say better finance technology would improve cost-saving decisions, many businesses still use outdated systems that make it much harder to respond to tariff fluctuations.

Enter smarter spend management. Advanced spend management platforms provide three vital capabilities that traditional financial systems can’t match:

• Real-time impact visibility: Instead of waiting for month-end or quarter-end reports, modern finance technology gives you instant insight into how tariff-related costs are impacting different business units, product lines, and regions. With this visibility, you can prioritise your response based on actual impact rather than guesswork
• Smart spend controls and alerts: With rising tariff pressures, preventing unnecessary spending is more important than ever. Smart spend management systems let you set targeted card controls (and AP approval workflows) on affected categories while keeping the flexibility you need for operations
• Scenario modelling for smarter decisions: Modern financial platforms help you test different approaches to managing tariff costs before making changes. By modelling various cost-cutting strategies, supplier adjustments, and selective price increases, you can find the right balance between protecting margins and staying competitive

Balancing short-term costs with long-term resilience

With the majority of CFOs planning to pass on an average of 73% of tariff-related costs, businesses must carefully manage this transition to avoid long-term financial and reputational risks. It’s a very complex path to navigate, and pushing up costs will likely be necessary in most cases, yet there are still ways to mitigate complete price rises by using the available smart software on the market, like a digital fine-tooth comb.

A combination of spend visibility, efficiency gains, strategic pricing, and finance technology should allow you to navigate tariff challenges without solely shifting the burden to customers. By focusing on cost management and cross-functional collaboration, CFOs can support difficult financial stability while also preserving customer trust.

If you’re interested in how finance leaders are tackling data transformation to support spend visibility, check out this wrap-up from a recent webinar I joined. We discussed how CFOs can cut costs, automate workflows, and boost financial visibility — covering everything from picking the right projects to aligning finance with business strategy (and the pitfalls to avoid). Read the full wrap-up of “Data Transformation & AI in Finance: Unlocking smarter decisions for CFOs”.