According to the Global Risks Report 2025, tariffs and other trade-restricting measures could have significant economic implications for companies worldwide this year. Even the potential for such changes in trade policy can create uncertainties for businesses and their supply chains.

Businesses may face delays in sourcing materials and higher component costs or be forced to find alternative suppliers, which could impact their production schedules and the final price of their good and services. Looking ahead, organizations may need to more comprehensively reevaluate their existing suppliers and the protections they have in place to manage related risks. 

Marsh has provided the following high-level, evaluative questions to help organizations assess their risks, navigate existing supplier relationships and vet new suppliers, and strengthen their supply chain resilience strategy.

Reviewing existing suppliers: Key considerations

To begin managing tariff risks, companies should map out the locations of their existing suppliers and then review their contracts, insurance policies, and history of managing disputes. This analysis should address price point pressures and may be guided by the following evaluative questions:

1. What practices do our suppliers have in place to address potential disruptions caused by tariffs? Do they have alternative suppliers in countries that are not subject to the tariffs? Do our suppliers and their third parties (including their suppliers, buyers, manufacturers, etc.) have adequate liability and property insurance?
2. How does our supplier plan to adjust pricing in response to changes in tariffs? Is there a mechanism for price adjustments in the contract?
3. Are there supplier clauses in the contract that address tariff-related risks, such as termination rights?
4. Do the contracts include any force majeure clauses covering tariff-related delays or cost changes? What are supplier cancellation and renegotiation rights if tariffs significantly impact costs? 
5. Does the supplier contract outline dispute mechanisms related to tariff impacts? How have disputes been dealt with in the past?
6. How does the supplier manage claims if a disruption in its supply chain impacts our operations? 
7. What financial protections are stipulated in the contracts if tariffs or other related events impact our supplier’s ability to deliver goods?
8. What communication protocols does the supplier have for notifying us and its stakeholders during a disruption? How does the supplier ensure that critical information is communicated effectively?

Companies should also review the potential credit risk of their suppliers and buyers:

1. Consider the financial health of your suppliers and buyers, including their credit rating, financial statements, and cash flow projections. What potential impacts could tariffs have on their financial stability and ability to fulfill contracts?
2. Do our suppliers and buyers have a system in place for ongoing monitoring of their performance and financial condition? This may include regular reviews of their ability to meet delivery/payment schedules, quality standards, and financial obligations, as well as any changes in their creditworthiness.

Seeking out alternative suppliers: Key considerations

When seeking out alternative suppliers, particularly those outside your preferred options due to location, it is essential to consider several key factors related to quality and risk management. Opting for a new supplier can introduce additional complexities and risks, especially if decisions are made hastily.

For example, transitioning to a different supplier may expose your organization to increased product recall and liability risks. Variations in the supplier’s quality control and regulatory processes can further elevate reputational risks.

Conducting thorough due diligence is crucial to mitigate potential quality risks. If your organization is considering changing suppliers, the following risk management questions should be addressed in addition to the organization’s standard procurement policies for onboarding new suppliers.

Property risk:

1. How does your organization quantify the property risks of suppliers? If using company or supplier-sponsored risk assessments, how often are risk assessments conducted? Does the supplier share such information with its vendors? Are the risk assessments current?
2. What top property risks has the supplier identified, and how do they prioritize risk control improvement? What security measures do they have in place to protect their facilities (for example, surveillance systems and access controls)?
3. Does the supplier’s location increase the concentration of risks, such as exposure to natural catastrophes and fire, or even new risks not present at prior supplier locations?
4. Does the supplier have the capacity to meet both current and future production demands? Keep in mind that operating equipment beyond its capacity, postponing maintenance, and pushing machinery to its limits can introduce significant risks.

Business interruption:

1. Does the supplier have a formal business continuity plan (BCP) in place? How is the effectiveness of the BCP demonstrated?
2. What recovery time frame can the supplier stipulate in the contract for resuming operations following an interruption, and can penalties be applied for not recovering in the prescribed time frame? 
3. How often does the supplier conduct tests or drills of its BCP? Can the supplier provide examples of past tests and their outcomes? 
4. Are facilities or third parties that the supplier would rely upon for business continuity now exposed to tariffs? Has the supplier experienced business interruptions in the past, and if yes, how were they managed?

Cybersecurity:

1. Is multifactor authentication deployed for remote access by supplier employees?
2. Is there a process for managing deactivated supplier employee accounts?
3. How do they ensure fourth-party access is restricted when accessing sensitive data?
4. Does the supplier’s cybersecurity strategy include an incident response plan that is regularly updated and practiced? 
5. Does the supplier have postmortem processes that include root cause analysis and a remediation plan to address incidents?

Environmental, social, and governance (ESG):

1. What sustainability initiatives does the supplier have in place to reduce its environmental impact? How do they measure and report on environmental performance?
2. Where are their facilities located, and how do they maintain alignment with sanctions and monitor for appropriate labour practices?

The above list of high-level considerations can help your organization prepare for and manage supply chain and tariff-related risks.