Tariffs Force Firms to Rethink Technology as a Survival Tool

The volatility wrought by tariffs is no longer a background risk but a daily operational reality, forcing companies to make strategic decisions with incomplete data and shifting economic signals. As tariffs collided with delayed government statistics and cooling consumer demand, firms have had to confront what PYMNTS Intelligence describes as peak uncertainty for product and operational leaders.

The PYMNTS Intelligence report, “Tariffs Turn Up the Heat as Product Leaders Confront Peak Uncertainty,” finds tariff pressure is not abstract. Nearly half of product leaders at goods firms say tariffs are mostly or completely negative for their business finances, underscoring how quickly trade policy is translating into balance-sheet strain and operational risk.

At the heart of corporate anxiety are the knock-on effects tariffs create across supply chains and shortages or delays tied to tariffs, while roughly 7 in 10 anticipate higher costs driven by customer demand. PYMNTS Intelligence finds 88% of product leaders at goods firms expect supply-chain reconfiguration.

Demand uncertainty compounds the problem. Nine in 10 goods firms focused on B2C markets report that macroeconomic conditions are cutting into demand, while even B2B-oriented firms see meaningful headwinds. These pressures make it harder to raise prices, especially in highly competitive and price-sensitive markets, limiting firms’ ability to offset tariff-related costs.

The impact of tariffs is uneven, with goods-based companies bearing the brunt. Product leaders at goods firms are nearly twice as likely as CFOs to characterize tariffs as a financial drag, reflecting their frontline exposure to sourcing, logistics and production challenges.

Firm size also matters. Companies with annual revenues between $100 million and $400 million are more constrained than larger peers, with less pricing power and fewer options to absorb shocks.

Here are five ways companies have told PYMNTS they are handling pressures arising from the tariffs:

• Firms are renegotiating supplier terms to blunt immediate cost increases and stabilize sourcing.
• Companies are reshuffling workflows and operations to reduce exposure to tariff-affected inputs.
• Many are tightening discretionary spending to preserve cash amid uncertain demand.
• Some firms are selectively adjusting product portfolios where flexibility allows.
• Pricing actions are being approached cautiously, particularly among goods firms with price-sensitive customers.

Technology remains a core part of corporate strategy, but its role is changing. More than half of product leaders say tariff disruption has pushed their firms away from long-term technology initiatives toward short-term operational fixes.

Artificial intelligence and automation illustrate this shift. While 60% of firms report that tariff uncertainty has constrained funding for AI and automation, roughly two-thirds say tariff pressure is also driving targeted investment in AI-driven supply-chain optimization. The emphasis is on immediate efficiency gains rather than transformational change, particularly among goods firms, where 82% cite AI as a tool to improve supply-chain performance under tariff pressure.

This pragmatic approach reflects a broader recalibration. Instead of abandoning technology, firms are repurposing it to manage volatility, control costs and improve visibility. PYMNTS Intelligence data suggests that while tariffs have forced difficult trade-offs, they are also prompting firms to rethink how strategy and technology work together in an uncertain global trade environment.

At PYMNTS Intelligence, we work with businesses to uncover insights that fuel intelligent, data-driven discussions on changing customer expectations, a more connected economy and the strategic shifts necessary to achieve outcomes. With rigorous research methodologies and unwavering commitment to objective quality, we offer trusted data to grow your business. As our partner, you’ll have access to our diverse team of PhDs, researchers, data analysts, number crunchers, subject matter veterans and editorial experts.

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