#412: Sales Leadership in a Tariff-Driven World
Applying our last several lessons to today’s real world problem.
Early in this new year, U.S. businesses faced a seismic shift in their operating environment as the President imposed 25% tariffs on imports from Canada and Mexico and a 10% tariff on goods from China. These measures, enacted on February 1 and solidified by March 4, aim to address national security concerns like illegal immigration and the fentanyl crisis. However, they also introduce significant uncertainty and cost pressures for sales leaders across industries. From automotive supply chains to consumer goods, the ripple effects are undeniable: higher input costs, disrupted pricing models, and anxious customers.
Sales leaders now face a dual challenge: maintaining profitability while preserving customer trust. This scenario mirrors the high-stakes adaptability required of political leaders in Washington, D.C., where rapid responses to trade policy shifts are critical. By rethinking what we have been discussing this year in these articles; customer discovery, refining deal-closing techniques, bolstering follow-up resilience, and applying frameworks like the OODA Loop, sales teams can turn uncertainty into opportunity. Let’s explore how.
Customer Discovery Under Pressure: Reassessing Needs in a Costlier World
Tariffs increase the cost of goods, forcing sales leaders to reassess client needs under new financial realities. The first question is strategic: Do you absorb the cost increase, pass it on to customers, or find new value propositions? Each option carries risks and rewards.
Absorbing the hit protects customer relationships but squeezes margins, potentially unsustainable for smaller firms. Passing costs directly to clients risks alienating price-sensitive buyers, especially in competitive markets. A third path, innovating new value propositions offers a proactive solution. For instance, a manufacturer importing Canadian steel might bundle tariff-driven price hikes with enhanced services, like faster delivery or extended warranties, to justify the increase. Alternatively, they could source from domestic suppliers, pitching it as a patriotic or supply-chain-resilience benefit.
This requires deep customer discovery. Sales teams must engage clients early, asking pointed questions: How critical is price to your decision-making? What additional value would offset a cost increase? Are you open to alternative suppliers or product lines? By better understanding these needs, leaders can tailor solutions that maintain trust while navigating tariff pressures much like how D.C. policymakers must gauge constituent reactions to trade policies before acting.
Closing Deals in a Costlier Market: Building Trust Amid Price Hikes
Closing deals becomes trickier when prices climb unexpectedly. Prospects may hesitate, fearing budget overruns or seeking cheaper alternatives. Sales leaders must maintain momentum by reinforcing trust and demonstrating value.
Transparency is key. Rather than hiding tariff-driven price increases, explain them candidly. For example, a salesperson might say, “The recent 25% tariff on Mexican imports has increased our costs, but we’re committed to delivering the same quality and reliability you expect. Here’s how we’re adding value to offset this.” Pairing this with data, such as how the product improves efficiency or reduces long-term costs, helps prospects see beyond the sticker price.
Flexibility can also seal the deal. Offering phased payments, volume discounts, or temporary price locks can ease the transition for clients. Sales teams should also highlight their company’s adaptability, such as efforts to diversify sourcing or absorb some costs, reinforcing the narrative of a dependable partner in turbulent times. This approach echoes the agility required of D.C. leaders, who must balance economic policy with public sentiment.
Remember the age old sales question; Price, Service, Quality - you can pick any two of them? Why did they buy your product to begin with?
Follow-Up Resilience: Retaining Clients Through Empathy and Persistence
Tariff-driven price hikes can spook existing clients, prompting them to explore competitors or delay purchases. Persistent, empathetic follow-up is essential to retain these relationships.
Start with proactive outreach. Contact clients before they notice the price change, explaining the situation and outlining mitigation efforts. For instance, “We’re facing a 10% tariff on Chinese components, which impacts our pricing. We’re exploring alternative suppliers and offering flexible terms to minimize the impact on you.” This shows accountability and care.
Follow-up should be consistent but not pushy. Use multiple channels; email, phone, even in-person visits to check in, address concerns, and reinforce value. Empathy is critical: acknowledge the client’s frustration and tailor solutions to their specific needs. A client facing a 25% increase on Canadian lumber, for example, might appreciate a referral to a domestic supplier or a discount on a related product. This resilience mirrors the persistence D.C. leaders exhibit when navigating contentious trade negotiations, ensuring stakeholders remain engaged.
OODA Loop Application: Pivoting Fast in a Dynamic Market
The OODA Loop—Observe, Orient, Decide, Act—offers a structured framework for sales teams to adapt quickly to tariff impacts. Originally developed for military strategy, it’s equally effective in fast-moving business environments.
Observe: Monitor tariff effects in real time. Track cost increases, supplier responses, and competitor pricing. Use customer feedback and market data to identify pain points.
Orient: Analyze this data in context. How do tariffs affect your industry? Are clients prioritizing cost, quality, or reliability? What alternatives (e.g., domestic sourcing) are viable?
Decide: Choose a course of action. Will you adjust pricing, renegotiate supplier contracts, or pivot to new markets? Decisions should balance short-term survival with long-term growth.
Act: Implement changes decisively. Update pricing models, communicate with customers, and train sales teams on the new approach. Speed is critical to stay ahead of competitors.
For example, a company importing Mexican auto parts might observe a 25% cost increase, orient around customer demand for affordability, decide to source some components domestically, and act by securing new contracts within weeks. This rapid pivot minimizes disruption and maintains competitiveness—paralleling the quick decision-making D.C. leaders employ during trade policy shifts.
D.C. Leadership Lesson: Congressional Response as Inspiration
Washington, D.C., offers a compelling parallel. Consider Congress’s recent response to the administrations tariffs. In early March 2025, as tariffs took effect, a bipartisan group of senators introduced legislation to curb the president’s unilateral tariff authority, arguing it harms businesses and consumers. Though unlikely to pass a Republican-controlled Congress, this swift action demonstrates proactive leadership in chaos.
This adaptability inspires sales leaders. Just as Congress seeks to mitigate trade policy fallout, sales teams must anticipate tariff impacts, propose solutions, and act decisively. The lesson is clear: in uncertain times, proactive leadership whether in D.C. or the boardroom, keeps you ahead of the curve.
Conclusion: Turning Challenges Into Opportunities
The 25% tariffs on Canadian and Mexican imports and 10% on Chinese goods have upended the sales landscape, but they also present opportunities. By reassessing customer needs, closing deals with transparency, following up with empathy, and applying frameworks like the OODA Loop, sales leaders can navigate this turbulence. Drawing inspiration from D.C.’s agile leadership, they can transform cost pressures into a chance to deepen client relationships, innovate value propositions, and strengthen their market position. In a world reshaped by tariffs, adaptability is the ultimate competitive edge.
Times like these are the best time to engage with companies like The Kole Performance Group. We can help identify options that you may or may not be aware of, or just help you spitball ideas and brainstorm. Let’s set up an appointment to discuss how these issues affect your sales team, profitability, and overall operations.