Navigating the New Normal: Supply Chain Challenges and Opportunities

Welcome to FinTech TV.

I'm Remi Blair.

Supply chains have become the new front line in the power struggle between the US and its trading partners.

This week's trade talks show just how intense that battle is.

And Washington and Beijing just broke a deadlock over export restrictions targeting crucial materials like rare earths and semiconductor techs, tools they're using to gain the upper hand, and we are seeing a shift in the global economic warfare.

With China controlling key manufacturing hubs and the US holding the lead in cutting edge tech, for companies and investors, this means a new era of risk and complexity.

Well, joining me here at the New York Stock Exchange to explain what this means for the world economy is Karim Khafori, president and CEO of the Atlas Network.

Well, Karim, thank you so much for joining me.

Thank you for having me.

Appreciate it.

Well, first and foremost, 2025 has been the most unpredictable. when it comes to the global supply chain, give us an understanding of where we are.

You know, we're at a very, very interesting crossroads right now where businesses have to pivot consistently.

They have to look to navigate challenges that they may not have ever faced before because we're looking at scenarios and sanctions such as tariffs that could be real opportunities or could be extremely disruptive depending upon how you look to navigate through those.

Challenges and more importantly, I think when we're talking about global supply chain, we need to think about who is being impacted the most and in this case I do believe it's the consumers and so we have to keep this in mind as we're looking across the board of global supply chain, the ups, the downs, the challenges, the controllable factors, the uncontrollable factors, and how everyone who's related in this industry, whether it's the businesses or the consumers are going to navigate these challenges.

And we all know that American consumers are paying close attention to prices, especially on the heels of the latest trade war and tariffs.

But when it comes to Main Street, how does all of this trickle down when it comes to global supply chain worries and what ends up in terms of prices?

Yeah, I mean, you know, I think that we need to be very cautious when it comes to pricing.

And what we've seen is a significant amount of stockpiling effect most recently post a lot of the tariff announcements where consumers are sort of running to buy their Christmas presents from now because they don't know what's going to end up happening.

We take, for example, you know, so many of the large scale.

Companies such as Walmart and Amazon and that 70% of the products that are bought and sold on these platforms, which is the way that most people are shopping these days, you know, are coming from places that are heavily tariffed like China.

And when it comes to the tariffs, the more important thing is who pays for them.

And this is a big sort of source of confusion in many ways.

It's a discussion that's really industry to industry, business to business on who actually pays for these tariffs because it's all about absorption.

The tariffs are going to happen no matter what.

Who's going to absorb it partially the supplier, partially the brand, partially the consumer.

It really depends product to product, industry to industry.

I talk a lot about this as far as 5 ways to manage these tariffs with regards to businesses and consumers, and you know what I think is very important is that whether you're dealing with absorption or deferral, which are strategic initiatives or operational initiatives such as working out terms and conditions with your suppliers, working out pricing or cost engineering of products, or finding new alternative supply chains, and no matter what, all of the options have to be on the table today.

And as you mentioned, when it comes to businesses, we're still not sure yet in terms of what will play out in terms of the tariffs.

So how can businesses actually go about planning and navigating the landscape?

Yeah, I mean, again, it is very much industry to industry and product to product for sure, but I do believe that they have to look at it in the ways that we just mentioned, which is from a strategic standpoint and from an Operational standpoint strategically would be the tariffs are here.

We just have to figure out how to deal with them.

Operationally is we have to change the way our business has operated in the past.

Let's look at the way that we made that widget.

Let's make it for less.

Let's use alternate materials.

Let's cost engineer it.

Let's look at hidden benefits and values that we can tout to maybe increase the cost of that to offset.

These tariffs and so you know again it's very, very situational, but businesses and consumers need to be prepared for navigating the ups and downs, and I speak a lot about that in my book Supply Chain Ups and Downs where I talk about this tumultuous ride which is essentially the supply chain and how we can navigate it in a compatible way that makes sense for businesses and for consumers alike.

Yeah, and when we think back to the COVID pandemic days, we saw how the supply chain actually worked.

But when we're talking about the current tariff situation, are there any positive outcomes or even opportunities that we can learn from?

Absolutely.

I mean, that's exactly what I believe.

I'm a supply chain optimist and I believe that through disruption there's opportunity and it's in those scenarios that you really tend to get creative because if you know the machine isn't broke, why fix it type of.

How it goes on too long, you can become stagnant within your industry and your field, your product category, but if you're consistently shifting because of the fact that you're in the face of adversity or challenges, that's where it breeds the most innovation and creativity.

So I do believe that that can come by way of alternative supply chains in different countries or regions, even domestically.

I believe, as I said before, some levels of cost engineering and price sensitivity scenarios and really even working out favorable terms and conditions with your.

Suppliers where you may have a higher upfront costs due to the tariffs, but it's navigated by increasing your cash flow position throughout time because you have better terms and conditions.

These are all areas where if these scenarios were not occurring, a business may not be thinking in those ways.

So it's an opportunity, I believe.

Yeah, and Karim, when we think back to not just the beginning of this year, but also the past like 8 months or even 12 months, we think about the unions, the strikes that.

Happen in addition to these chairs, so I think disruption may be the new normal, but as you mentioned, opportunities abound on the heels of this disruption.

So for all of us looking at this and trying to figure out how it affects our daily lives, for businesses as well as for consumers, is this the new norm?

It absolutely is a new norm, and the interesting thing is that anybody who's been in the industry of supply chain management for many, many years before it became a buzzword that we're all hearing about all the time.

Understood that this industry is an industry of disruption.

It is an industry that is full of challenges and complexities, but that is what makes it unique and different and gives those opportunities to truly push the global economy forward.

I talk about it also in my book about this idea of supply chain socioeconomics, which is a term that I coined, where I discuss that the interests of customers and suppliers are completely at odds with each other.

They're divergent, but It's that push and pull that differences those those factors that you don't always that you can't always control that actually spur the global economy forward.

So it's in the face of those challenges that we come up with the most creative solutions.

So we shouldn't be stockpiling smartphones, laptops, or washing machines here.

I mean, I believe that again for particular industries that to pick up opportunities just like stockpiling when they're available.

Of the 90 day pause and so forth is always a great idea because we don't know what is necessarily ahead, but as we know too, inventory can kill businesses.

So it's this kind of push and pull navigation that has to be done to really determine how far you push that envelope as far as on the inventory management side of things.

OK, Kareem, well, thank you so much for joining me.

A very timely topic, so I appreciate your insight and your perspective.

Thank you so much.

I appreciate it.