Navigating the financial impact of US tariff volatility
Regardless of your opinion of the current United States administration, one thing is clear: decisions made in Washington are having significant ripple effects across global markets. Recent tariff announcements – sometimes coming with little or no warning – highlight the US reach and impact on global trade. For businesses, the evolving landscape demands close attention and a proactive approach.
Tariffs changes won’t just impact businesses trading with the US
Even if your business doesn’t engage directly with the US, you may not be immune to the consequences.
Tariffs imposed by or against the US can reverberate through global supply chains, alter pricing dynamics, and shift competitive positioning across sectors. For UK businesses in particular, indirect exposure - through suppliers, customers, or partners linked to the US - can be just as impactful as direct trade ties.
Lenders are taking note
Lenders are taking note
We are already seeing some funders introduce a new layer of due diligence to assess tariff-related risk. It is therefore essential for businesses to proactively review the potential financial impact - on both profitability and cash flow.
In particular, businesses should:
- Conduct stress testing and scenario planning to quantify exposure.
- Model cash flow implications under different tariff assumptions.
- Review and, if necessary, renegotiate banking facilities to ensure appropriate headroom.
Understand potential pinch points and opportunities
Working capital will likely come under strain as businesses adjust. You therefore need to assess where the pinch points are and how you carefully navigate the current period of volatility and likely change.
Opportunities may also present themselves - whether via a refocus of your geographic exposure or doubling down as others hesitate and potentially do nothing. Whatever your strategy, you’ll need to consider how this stretches your financial base and what headroom you have. See our insights on what UK businesses should do to navigate US tariff changes.
We are here to help
Our advisory teams across the UK are on hand to help you model the impacts and review your banking arrangements. We have access to a range of funders who may well offer a more optimal suite of products which help you trade through an ever-changing landscape. Please reach out to our Corporate Finance and Debt Advisory specialists to discuss your specific situation.
For those in financial discomfort, please don’t hesitate in speaking to our Restructuring team. If you have any concerns or are experiencing any difficulties, sooner is always better than later.
