Analyst Insight: In 2025, manufacturers and supply chain companies will juggle the competing demands of building supply chain resiliency, fortifying revenue processes and adopting new technology. 

Preparing for Tariffs

Tariffs are an immediate concern for semiconductor manufacturers and their supply chain partners. President Donald Trump campaigned on promises of installing a blanket tariff on all imports — 10% to 20% on goods from all countries and 60% or more on Chinese imports. These rates are a significant increase from existing policies. 

The U.S. semiconductor supply chain relies heavily on foreign chips. Companies must prepare for potentially increased costs by re-evaluating their supply chain structure, and prioritizing resilience, compliance, and cost-effectiveness.

The Value of a Supply Chain Audit

Companies should execute comprehensive internal audits to identify potential vulnerabilities in their supply chain operations. These inspections can reveal single-source dependencies and risk exposure, allowing companies to evaluate potential alternatives. Manufacturers may benefit from consolidating their distributor and supplier partnerships. Focusing on fewer, strategically chosen partners supports better compliance, enhances reliability, and streamlines operations. 

Mapping a product journey from material sourcing to end users allows companies to better estimate financial impact. Understanding the quantity, source and final destination of materials delivers granular data for more precise calculations. Manufacturers can budget for material price increases, or strategically adjust their supply chain to reduce costs. Supply chain mapping also uncovers revenue leakage and compliance gaps. By closing these holes, companies can avoid additional losses through fines and missed opportunities. 

Much Ado About AI

Many companies are interested in AI’s potential in areas like product testing, predictive maintenance, data-driven process optimization and revenue management. Model N’s State of Revenue Report revealed that nearly 60% of executives plan to embrace AI. 

As companies embark on their journey to measure AI’s value, the question becomes what type of AI capabilities can create maximum output. There will be an increased focus on how GenAI, agentic AI, and robotic process automation (RPA) can work together to optimize a company’s output. Although implementing this technology will take time as the industry explores its most effective applications, companies that are implementing or taking steps to implement these technological capabilities will see faster outcomes for quick and measurable improvements. 

Outlook: Global trade policies are primed for significant fluctuations in the next few years. Manufacturers and suppliers must create an agile supply chain to react to not only new U.S. import tariffs but also responses from other countries. Audits and continuous monitoring give companies the necessary visibility to anticipate and respond to changes. AI could aid an agile supply chain, but organizations must be willing to thoughtfully experiment with it in order to determine its best uses. 

Resource Link: https://www.modeln.com/