Resilience Amidst Uncertainty
This article appeared in the April 2026 issue of MiMfg Magazine. Read the full issue and find past issues online.
Economic uncertainty, political volatility and rapidly advancing automation can all leave business owners feeling overwhelmed when it comes to streamlining operations and planning for the future. Whether they benefit businesses or increase challenges, tariffs, wars, tax policies, job turnover, supply chain demands, automation advancements, even gas prices all impact everyday operations.
How do you plan for the future when what we know today may change by tomorrow? How can you streamline business operations and maintain a steady bottom line under these circumstances?
The answers lie in recognizing what the issues really are — and then stepping up to mediate them long before they cause problems.
Monitoring the Issues and Communicating with Partners
Business leaders certainly should analyze past data. They should recognize trends, identify where the industry is headed and plan for the next 90 days using rolling forecasts and scenario analysis, rather than relying on what the past 90 days already tell you, says Tom Shemanski, Principal at the Troy-based Rehmann professional advisory firm.
The tariff issue continues to concern manufacturers because what will happen later this year remains to be seen. There are many possibilities, including the potential reintroduction of tariffs under other statutes, according to Richard Walawender, Senior Principal at the Detroit-based Miller Canfield law firm.
Not knowing what will happen has left business owners on edge but getting ahead today can help them remain steady tomorrow.
One way to mitigate risk is switching from international vendors to local sources by focusing on redesigning products for material or labor savings, Shemanski says.
Communicating with vendors and partners right now is one of the most important keys to minimizing disruptions and preventing disputes, according to both Walawender and Shemanski.
Reviewing contracts can be particularly helpful to ensure each party’s responsibilities under various circumstances is addressed — especially in light of the tariff controversy, Walawender says. Because businesses must understand how tariffs will impact their processes and finances, he says there’s never been a better time for a company to sit down with its customers and suppliers to rationalize this into their contracts.
“To prepare for the future, addressing this issue is absolutely something every company should do right now,” Walawender says, adding that this applies to both buyers and sellers. “That is a way to try to contain that uncertainty going forward. If new tariffs are implemented, at least the businesses will have a framework as to who bears the burden, if it’s passed along, and how it’s dealt with.”
Many clients have also asked Miller Canfield’s attorneys about the refunds for tariffs that were paid: How do they obtain the refunds? Which business in a particular partnership should file for the refund? Should refunds be split, and how should the money be allocated?
The issue can become complex, he says, providing the example of a shipping organization that works with thousands of businesses that, in many cases, shipped extremely large loads. Because the importer of record is currently the only party eligible to apply for and receive a refund from U.S. Customs, Walawender has been advising such clients not to rush to court but first to talk one-on-one with their suppliers and customers.
“It’s a good time for manufacturers, whether or not they were the importer of record, to sit down with their vendors, suppliers and customers to work out a procedure to file for the refund and pass that along to whoever really bore the burden of the tariff,” he says. “I’m saying this because if you file litigation, get in line — it’s going to take a long time and will likely sour the business relationship.
“But, more importantly, sitting down with your suppliers and customers may really help the relationship,” he adds. “I think this is an opportunity for the supply chain to start getting along with each other in a way you haven’t seen.”
Shemanski has similar perspectives, saying businesses should build productive relationships with one another in general by talking about challenges, such as inflation, and how to minimize them.
“They’re just realities of life, and they need to be addressed proactively because if you just sit back and wait for your customer to make all the decisions, they’re going to expect you to lower your price or you’re going to lose the business,” Shemanski says.
Portfolio Management and Sound Financial Decisions
A healthy bottom line can help businesses overcome challenges and offering the least expensive product isn’t necessarily the way to increase your customer base.
The focus should be on value, Shemanski says.
“There’s a lot of pressure to push down pricing, so you need to have a really good understanding of why your product or service is valuable so you can push back against those pressures,” he says. “The solution you’re bringing to customers is information you need to know to adequately price yourself and your products in the market.”
Manufacturing is capital-intensive, he adds, so businesses must make a sufficient margin to be able to reinvest in the business.
“That’s where companies get into trouble — responding to a lot of pricing pressure until they eventually run out of margin and can’t reinvest,” Shemanski says. “You’ll never understand what you’re making until you really understand what you’re spending for customers, product lines and technology.”
As for growth strategies, having the right sales mix is very important, he says, and businesses should think of it as a portfolio. Hypothetically, the sales margin might range from 20-40 percent, so understanding the right mix across this margin range is critical to building out a sustainable business model and providing clear direction and expectations to sales teams.
Having adequate reserves and a line of credit with your bank, being prudent with accounts receivable and collecting everything that’s owed to you are additional ways to build a safety net in case of turbulence.
Leveraging AI and Automation
Modernizing technology and streamlining processes by incorporating AI and other automation solutions also can help businesses navigate unexpected challenges.
From a legal standpoint, Walawender is focused on businesses protecting their intellectual property rights and trade secrets considering that AI is being used for coding, designing and engineering products and systems. At the same time, leveraging AI is a necessity, he says.
“There are private equity funds already looking for acquisition targets simply to introduce AI mechanisms to their operations,” Walawender said.
“AI is one of the bigger opportunities in manufacturing, both on the shop floor and on the administrative side,” agreed Shemanski, adding that it will further contribute to workflow automation, quality control and the optimization of robotics. “All of those are going to be the next level of productivity gains that manufacturers are going to need to be competitive globally.”
Automation and AI can also resolve certain types of workplace shortages and reduce expenses — both of which can be helpful if tariffs, taxes, supply chain demands or other issues affect the industry.
“It doesn’t address the challenges of finding technical workers, but the more you can invest in automating other parts of the business, the more it frees up money to invest more in that technical side,” Shemanski says.
Being one, two or 100 steps ahead — whether it’s through solidifying contracts, leveraging federal or state funding opportunities, implementing AI solutions, or financially diversifying your business portfolio — is key to minimizing disruptions in the face of a turbulent political and economic climate.
Have a manufacturing story to tell? E-mail communications@mimfg.org.