Customerland

Tariffs have become a hot-button issue that's reshaping the retail landscape in ways few could have predicted. In this revealing conversation with Duleep Rodrigo, KPMG US Consumer and Retail Sector Leader, we cut through the noise to understand how these economic policy decisions impact both businesses and everyday consumers.

Unlike typical economic downturns where consumer behavior follows predictable patterns, tariff situations create a uniquely dynamic environment. "The tariff landscape can shift in a day," making strategic planning particularly challenging for retailers who source products globally. Rodrigo unpacks how companies navigate this complexity, explaining why some retailers face minimal disruption while others scramble to rethink entire supply chains.

The conversation takes a fascinating turn when examining consumer loyalty during economic uncertainty. Our data reveals that while consumers initially stick with trusted brands during disruptions, they gradually prioritize value as situations persist. "Price and quality are two of the key variables that continue to come up," Rodrigo notes, though the balance between them shifts depending on product category. For durable goods like electronics, quality often trumps price, while convenience emerges as a powerful third factor influencing purchase decisions.

Perhaps most surprising is Rodrigo's revelation that "most senior executives are not panicking" despite media narratives suggesting otherwise. Instead, forward-thinking retailers are methodically modeling tariff implications, exploring sourcing alternatives, and developing nuanced pricing strategies by channel and category. The message is clear: while tariffs create legitimate challenges, they also present opportunities for agile companies with strategic vision. Listen now to gain insights that could help your business navigate these uncertain economic waters.