How Finance Leaders are Responding to Tariffs, Inflation, and Economic Uncertainty

The tariffs, trade wars, and geopolitical tensions some thought to be just talk have become reality. And as tariffs rise and fall, firm plans turn to mush, and inflation risks grow, it’s never been as important for businesses to fine-tune forecasting and hone strategies to get ahead of economic uncertainty instead of just reacting to it.

Country-by-country trade deals may continue to be made, and specific tariff rates shift with the week and location, but the fact remains that the impact of tariffs are already being felt near and far. Recent surveys show how CFOs and other business leaders feel about economic uncertainty:

• 59% of business leaders say tariffs will negatively affect their organizations, while 85% say tariffs have affected their planning, according to a March survey by accounting organizations.
• Just 2 in 5 business leaders came into the year feeling prepared for market disruptions, as BCG found.
• 37% of finance leaders cite geopolitical tensions as a top external challenge in 2025, compared to 11% last year, according to our CFO Insights survey.

From seeking new forecasting methods to considering supply chain shifts to deciding how much of tariff costs to pass along, it’s time for the 3 in 5 unprepared leaders to become better prepared.

Read on and learn about:

• Developing strategies to fortify forecasting, including scenario modeling, simulations, and casting a wide net for data.
• Using artificial intelligence (AI) to achieve a more responsive top-down forecasting approach.
• How businesses are considering shifting costs to customers, weighing the best time to execute pricing strategy, and using trade regulations and categories to their advantage.

The end of trends: How CFOs Can Lead Through Tariffs and Other External Disruptions

The latest eBook in our CFO Insights series focuses on how global and SAP finance leaders are bolstering forecasting and improving coping strategies amid economic uncertainty.

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Forecasting must shift with tariffs, trade wars, and economic uncertainty

Forecasting is forward-looking but traditionally built upon past information. The challenge, with U.S. tariffs at their highest since the 1930s, is that past data might not be as helpful amid the current economic uncertainty. New approaches and new technologies – such as AI – promise a path forward.

While it can be difficult to predict tariff rates and the ensuing geopolitical conflicts, organizations have strategies and technology available to shore up predictions, agility, and resilience in the face of economic uncertainty. The tools’ usefulness rests upon having timely and complete data from integrated travel, expense, ERP, CRM, and other systems, which enables strong reporting and analytics to inform decision-making.

Data-driven forecasting strategies include:

• Scenario-driven modeling to forecast how tariffs and other disruptions will affect revenue, costs, supply chains, and other business drivers.
• Real-time simulations and visualization tools that quickly run through possible supply chain changes and enable adjustments to locations and components.
• Using a big-data, wide-net approach to provide more complete and transparent picture as tariffs ping-pong about.

With 48% of CFOs telling Gartner they were considering supply chain adjustments, leaders should consider multiple approaches and reinforce their data foundations.

“The pressure is on CFOs to pull tons of data we’ve never analyzed in the past and recommend actions such as switching countries or producing something internally,” says Barbara Salazar, CFO at E2 Consulting Engineers. “We’re running lots of models and simulations on our supply chain exposures to see how dependent we are on different products and countries, which might still be efficient, and which costs we can pass on to consumers.”

How does AI power a faster, more responsive type of forecasting?

Conducted in late 2024 and early this year, our CFO Insights survey found 43% of finance leaders ranked more accurate forecasting as their most sought-after AI benefit. With tariffs delivering new and fast-moving conditions, new technologies can help organizations meet the challenges and accelerate strategic responses to economic uncertainty.

Dr. Carl Christian von Weyhe, CFO of Middle & Eastern Europe at SAP, says SAP is using a top-down, AI-driven forecasting approach in place of the slower, bottom-up one that relied on information – often less accurate – supplied by individual managers. It’s a transition illustrating how finance teams have moved away from manual and disconnected processes to gain productivity, strengthen cost control, and navigate economic uncertainty. Where once teams had to sift through spreadsheets or manually merge data sources, technology handles the busywork.

“We need to change the way we forecast. Lots of data in the market is changing,” says Claudia Ibarra Pérez, CFO of Greening Group México. “I’m using AI, which is fast and accurate, and has been useful to improve forecasting and decision-making, for example, around whether tariffs affect the consumer and how.”

How to revise pricing strategies in a new geopolitical landscape

Some businesses are fortunate to not have been hit by tariffs of 185%, as one T-shirt shipment incurred between the time the U.S. raised and then lowered tariffs on goods from China. With a changing geopolitical landscape, companies are examining pricing strategies and gauging how much they can inflict on customers. Large retailers like Walmart are cautioning it will be difficult to absorb all the costs.

Overall, 30% of CFOs told Gartner they planned to pass along 91% to 100% of the tariffs, while 29% thought they’d share 10% or less of costs to customers. On average, pass-throughs were expected to average about 73%.

The tariff impact varies by industry and even within them. Smaller businesses are susceptible, especially when they depend on single suppliers and lack the resources to adjust or wait out a trade war. Coping strategies can be influenced by margins, cash reserves, and price sensitivity of a company’s products.

CFOs and other experts recommend:

• Pursuing suppliers in nations that have been affected less by the tariffs.
• Working within the permitted trade structure to change prices of imported products or reclassify goods under different, lower-duty rates.
• Seeking tariff exemptions and using free trade zones.

Few things are more important than timing. “We try to understand if this is a temporary event we can absorb or something we need to react to,” says Massimiliano Zambon, Head of Finance at Giovanni Rana. “If we need to pass on costs, we must react immediately. We can’t wait six months because that’s too late to ask the customer for a price increase.”

Navigating tariffs, inflation, and economic uncertainty by pairing tech and human expertise

Business leaders have potential options to contend with the economic uncertainty – and possibly inflation – that arrive with tariffs. But, as CFOs observe, waiting isn’t one of them.

The survey of accountants mentioned earlier noted a 20-percentage-point drop in business optimism in three months. While you don’t have to force optimism, you need to do everything possible to contend with tariffs’ effects.

Intensifying and strengthening forecasting is a key strategy, of course, and should involve seeking out tools that are flexible, easily integrated, scalable, and AI-fueled. Seeking expertise alongside new technology can be critical to success.

“There are lots of new technologies that aren’t being implemented. We need more training and skills to implement and make them usable,” says Salazar, the CFO at E2 Consulting Engineers.

Learn more about navigating economic uncertainty in our latest eBook, The end of trends: How CFOs can lead through tariffs and other disruptions.

Looking for more insights and inspiration from CFOs? Visit www.concur.com/cfo-insights