Whether it’s a reported 7.4% increase in the price of toys at Walmart, or Best Buy warning it will “adjust prices as tariff-related inventory cost changes are implemented,” or Home Depot cautioning it may stop offering some products because tariffs make them too expensive for consumers, the picture is clear: It’s increasingly sobering for large enterprises dealing with the Trump administration’s on-again, off-again global tariffs agenda.
More than eight in 10 of the largest firms now expect mostly or completely negative impacts from the White House’s trade policies. The share of pessimists surged 24 percentage points from May, when 56% predicted the same. While smaller enterprises are feeling a little less doom-and-gloom about the economic impact, they’re not exactly bursting with optimism given that the new levies impact 70% of U.S. imports. Overall, enterprises are now nearly twice as likely to predict mostly negative outcomes as they are to predict mostly positive ones.
Drilling into those expected consequences, the largest enterprises unanimously expect supply chain reconfiguration costs, shortages or delays in getting products they need, difficulty with exports and potential layoffs or reduced hiring. Smaller enterprises aren’t much more optimistic, particularly as the monthly pace of inflation for goods, services, housing, medical care and the like tripled in June to the highest level since February.
Are large companies standing frozen in the near-daily tariff headlines, which first rolled out as sweeping import duties in April? Of course not. Companies have to plan their fiscal-year operations many months in advance, if not longer. They are already snapping into action, implementing strategies to cope with pressures from U.S. levies on major trading partners, including the European Union (EU), China and Mexico, as well as other countries’ retaliatory tariffs and a new August 1 deadline for some countries to reach a deal. Companies don’t appear to be waiting to see where things land or how severe the impact might be on the economy and consumer trends. Instead, they are focusing on short-term operational shifts. They’re reducing operational costs where possible, negotiating with their suppliers, utilizing just-in-time inventory strategies and more.
These are just some of the findings detailed in “The CAIO Report: Tariff Turbulence: Product Leaders Shift Strategy to Blunt Fallout,” a PYMNTS Intelligence exclusive report. This edition examines how enterprises view and respond to new trade policies, and how these responses vary by company size. It draws on insights from a survey of 60 chief product officers and heads of product working at U.S. firms that generated at least $1 billion in revenues last year. The survey was conducted from June 4, 2025, to June 17, 2025.
80% of the Largest Enterprises Expect Negative Impacts from Tariffs
The biggest companies expect to be the hardest hit. Eight in 10 product heads at the largest enterprises—those with annual revenues exceeding $10 billion—now say they anticipate tariffs will yield mostly or completely negative impacts on their business. Just 10% expect mostly or completely positive effects, down from 19% in May.
Smaller enterprises are more optimistic. In fact, less than one in four with annual revenues between $1 billion and $5 billion expect negative impact. This is down from 29% in May. The share foreseeing mostly or completely negative impacts plunged to 23% in June from just over one in two the month before.
Mid-sized enterprises, those with revenues between $5 billion and $10 billion, are more split. Granted, they are five times more likely to anticipate negative impacts (33%) than positive (6.7%). But six in 10 predict both negative and positive impacts, nearly double the level in May.
It’s Unanimous: All the Largest Enterprises Brace for Shortages and Rising Costs
All of the largest enterprises are preparing for a range of negative impacts. Specifically, 100% of these firms expect costs from reconfiguring their supply chains to shortages or delays in getting certain products. Similarly, all of them anticipate difficulty exporting products and/or services as well as potential layoffs or reduced hiring.
Most smaller enterprises are also concerned about these issues, though not unanimously. Namely, 83% of the smallest enterprises anticipate supply chain reconfiguration costs. Plus, 82% expect shortages or delays, and 80% predict difficulty exporting products and/or services.
Notably, 92% of enterprises expect positive impacts from opportunities to support local economies, and 82% expect enhanced supply chain resilience.
Tariff Response: Large Enterprises Are Cutting Costs, Smaller Players Seek Value-Added Services
Amid the Trump administration’s constantly fluctuating make “trade agenda” approach of “reciprocal” tariffs, “secondary” tariffs and trade talks, enterprises are already taking action.
To offset the pressures, most of the largest enterprises—57%—have been moving to reduce their operational costs. Half have been negotiating with their suppliers for better prices, and half have been tightening their inventory by implementing just-in-time strategies.
Most of the smallest enterprises are also reducing operational expenses. But just 22% of mid-sized enterprises have taken action to do the same. Mid-sized enterprises are most focused on securing better prices, with 75% having entered into negotiations with their overseas suppliers.
Small enterprises are the most likely to introduce value-added services to justify their price increases. Specifically, 43% have done so, versus just 25% of the largest enterprises and none of the mid-sized enterprises surveyed.
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Methodology
“The CAIO Report: Tariff Turbulence: Product Leaders Shift Strategy to Blunt Fallout” is based on a survey of 60 chief product officers and heads of product working at U.S. firms that made at least $1 billion in revenues last year. The survey was conducted from June 4, 2025, to June 17, 2025. The report examines how enterprises view and respond to new trade policies, and how these responses vary by company size.
