Mastering Pricing Strategies Amid Tariff Uncertainties

Pricing is both art and science. And as global trade and economic dynamics undergo rapid shifts, especially with the introduction (and withdrawal) of tariffs, that balance becomes even trickier. Tariffs add a new layer of uncertainty to already complex pricing systems, forcing organizations to adapt quickly to protect profitability and maintain customer trust.

This blog will guide you through the crucial strategies that enterprise businesses are employing to succeed amid tariff-induced chaos. It will focus on insights from pricing leaders Michael Van Gheem and John Carberry. Whether you’re navigating a forward-looking pricing model or feeling the pressure of real-time changes, these lessons will reinforce your approach.

Additionally, we’ll discuss actionable ways to refine your pricing strategies in response to tariff challenges, all while leveraging PROS Price Optimization Technology to enhance profitability and resilience.

Pricing in Motion: Tariffs as a Real-Time Pressure Test

The introduction of tariffs sent shock waves through businesses worldwide, causing abrupt cost fluctuations that compelled companies to reassess their pricing strategies almost instantly. Decisions that once took weeks now had to be made, adjusted, and refined within mere hours.

In this environment of constant change, flexibility, agility, and a willingness to navigate uncertainty became essential for success. While mistakes were inevitable in such volatile conditions, the ability to adapt quickly often became the key to a company’s survival.

Actionable Insights:

• Modeling and Math: Consider adopting flexible pricing systems that allow quick adjustments based on real-time factors.
• Communication as the Operational Backbone: Ensure your team is prepared for constant change, fostering a culture of adaptability to manage unexpected tariff shifts.
• Lead through Uncertainty: Use technological solutions like automated repricing tools to handle adjustments swiftly and efficiently.

Modeling and Math: Making the Uncertain Actionable

Static pricing models cannot keep up in a world of unpredictable tariffs. Instead, businesses need dynamic tools and strategies that make uncertainty more actionable.

Many enterprises turned to advanced modeling techniques, such as blended costs and scenario analysis. However, the focus wasn’t on achieving perfect accuracy. Instead, the goal was confidence in decision-making. This balance between precision and agility enabled organizations to adapt their pricing without incessant delays. While errors were inevitable in such volatile conditions, the ability to pivot promptly often determined a company’s survival.

Michael Van Gheem, Director of North American Marketing for Hammond Power Solutions, reflects on the challenges of implementing price increases during turbulent market conditions:

“One of the first times we made a major price increase related to tariffs, that night it was rescinded, and within six hours, we had our system back to where it was before.”

Michael Van Gheem Director, North American Marketing for Hammond Power Solutions

John Carberry, Vice President of Global Strategic Pricing and Analytics at ADI Global, further emphasizes the importance of leveraging advanced technology to stay flexible in unpredictable markets:

“What we’ve seen is that the power of the PROS platform allows us to navigate challenges more effectively. It gives us the flexibility to quickly implement changes, remove them, or update and prepare them as needed. The system, and the technology behind it, has definitely helped us manage and adapt through uncertainties.”

John Carberry Vice President of Global Strategic Pricing and Analytics, ADI Global

How PROS Helps:

Pricing leaders leveraged technologies like PROS to:

• Blend costs across multiple supply chains to create adaptive pricing models.
• Use predictive AI to forecast demand and pricing conditions, accounting for layered tariff impacts.
• Improve alignment between departments, ensuring cohesive pricing strategies enterprise-wide.

Best Practices for Tariff Modeling:

1. Focus on Actionable Insights: Modeling doesn’t need to be perfect but should provide clarity to guide decision-making.
2. Scenario Planning is Key: Regularly simulate “what if” scenarios to prepare for possible tariff changes and opportunities.
3. Integrated Tech is Crucial: Use pricing tools that integrate seamlessly with existing ERP and CPQ systems for better agility and cross-function communication.

Communication as the Operational Backbone

When tariffs upended pricing, communication proved to be as important as the pricing decisions themselves. Externally, customers sought clear explanations of price changes. Internally, teams needed alignment to avoid inconsistencies that could confuse the market and lose trust.

Best Practices for Effective Communication:

1. Internal Consistency: Establish centralized Q&A documents and ensure all customer-facing teams (sales, support, marketing) communicate a unified message.
2. Customer-Focused Messaging: Clearly explain the reasons for price changes and acknowledge the complexity, but with transparency. For example, saying, “We’re still analyzing tariff impacts to ensure minimal disruption to your pricing structure”, can earn customer trust.
3. Cross-Functional Alignment: Consider daily or weekly check-ins across pricing, supply chain, and customer relations to ensure organizational consistency.

Carberry also highlighted the importance of maintaining resilient relationships by balancing transparency with action:

Learning to Lead in Uncertainty

Tariffs have shown us that leadership in pricing requires more than just data-driven strategies. It requires a mix of technical expertise, empathy, and willingness to admit uncertainty when necessary.

Whether introducing surcharges, redefining pricing tiers, or transparent line-item changes, the priority should be to minimize friction for customers while maintaining business viability.

Here are actionable frameworks leaders can consider:

• Use Transparent Pricing Mechanisms: For example, surcharges are traceable, but disputable, while list price changes provide clarity at the expense of flexibility. Choose what aligns best with your customer base.
• Empower Sales Teams: Equip them with easy-to-digest matrices and training to consistently answer tariff-related customer concerns.
• Stay Agile: Ensure pricing models are built to retract or pivot without disrupting customer trust.

Build a Pricing Foundation That Withstands Turbulence

Tariffs aren’t the first form of volatility pricing teams have encountered, and they certainly won’t be the last. The lessons we learned here can help us handle future challenges.

Flexible pricing systems, integrated technologies, clear communication, and empathetic leadership are timeless strategies for navigating uncertainty. Companies using AI-powered platforms like the PROS Platform have found they’re not just reacting, but proactively positioning themselves for the next wave of change.

“Luck tends to favor the best-prepared,” notes Van Gheem. Prepare your pricing infrastructure now, and resilience won’t be just a buzzword; it’ll be your business advantage.