This morning’s Financial Times Daily News Briefing highlighted an emerging strategy among global companies navigating the murky waters of tariffs and trade barriers: leveraging supplier collaboration to reduce the declared value of goods and, consequently, their customs liabilities.
While trade restructuring has been a headline topic for years, many companies are no longer waiting for long-term reconfiguration of supply networks. Instead, they’re working now — with suppliers — to find creative, legally viable ways to reduce costs, especially those tied to import duties.
How are they doing it?
By redefining supplier contracts, companies are lowering the product cost declared at customs, thereby paying less in tariffs. But this doesn’t mean suppliers are losing out. Instead, the value is being shifted into reciprocal services — such as marketing support, R&D collaboration, or joint go-to-market activities — in other regions or through different channels. It’s not just smart — it’s collaborative by design.
Imagine this:
Rather than paying a supplier €500,000 for goods and declaring that full value on the shipping manifest, a company agrees to pay €300,000 for the physical goods and provide €200,000 worth of regional marketing services in a high-growth market in exchange.
This “barter-like” mechanism reduces the customs-declared value while preserving — or even enhancing — the total value of the transaction for both parties.
Where SCOR Comes In: BP.145 Supplier Collaboration
The SCOR model has long emphasized the value of supplier collaboration (BP.145), usually framed in terms of improving service levels, planning stability, and inventory control. But this real-world example from the FT adds another layer: commercial creativity.
BP.145 is all about sharing rolling forecasts, fixing and flexing commitment windows, and aligning on capacity — but underpinning that is a trusted, strategic relationship. It’s exactly this foundation of trust that enables innovative solutions like the one above.
When companies trust each other, contracts can evolve. Values can be redistributed. Costs can be offset without triggering supply disruption or financial disputes.
Key SCOR Elements That Support This Approach
- P3.2 Assess and create initial source response – This is where companies evaluate sourcing options not just on price, but on flexibility and mutual value potential.
- S1.7 Determine level of collaboration arrangement – Companies increasingly need deeper, more strategic collaboration levels to unlock these kinds of innovative trade agreements.
- HS.0181 Negotiation & HS.0207 Sourcing – These people practices are now at the forefront of risk mitigation and cost optimization strategies, requiring teams that can balance legal, financial, and relational dimensions of supply agreements.
What This Means for Supply Chain Leaders
If you’re waiting on your long-term network redesign to kick in before addressing rising tariffs, you’re missing a trick. The most agile businesses are not waiting — they’re collaborating. Right now.
To do this well:
- Revisit your supplier collaboration models.
- Identify mutual value areas beyond physical goods.
- Empower your sourcing and commercial teams to explore reciprocal value opportunities.
- Align contracts with cross-border compliance teams to ensure solutions are legally sound.
This isn’t just supply chain agility — it’s supply chain ingenuity. And in an era of economic volatility and rising protectionism, that could be your most important competitive edge.
