In the world of firearms manufacturing, cutting steel and aluminum is a fact of life. So it’s no surprise that all U.S. gun makers, as well as archery, optics, and gear companies, are bracing themselves for next Wednesday.
The decision by the Trump Administration to impose a 25% tariff on imported steel and aluminum, effective March 12, 2025, is poised to reshape the manufacturing landscape. At least in the short term.
This policy, aimed at bolstering domestic production and recalibrating our international trade imbalances, presents both challenges and opportunities, particularly for small to mid-sized manufacturers in the firearms, archery and accessories industries. As businesses that rely heavily on these materials to produce their goods, manufacturers will need to navigate higher costs with strategic foresight.
Here’s how manufacturers can adapt to the new tariff regime, leveraging their flexibility and ingenuity to maintain their competitive edge.
Pivot and Diversify
The immediate impact of these tariffs is clear: imported steel and aluminum are now more expensive. For smaller manufacturers, the knee-jerk reaction might be to panic, but now is the time to diversify suppliers.
Domestic suppliers, while generally pricier, may offer more predictable lead times and quality consistency, not to mention they are now a more cost-competitive option with new tariffs in place.
Your supply chain, perhaps once a linear route, needs to evolve into a network of potential partners, each offering something different. Building strong, diverse relationships is crucial for mitigating the risks associated with price fluctuations. It’s about knowing where you can shift and adapt, which will take some legwork but can pay off handsomely in both the short and long term providing cost control and reliability.
Get Operationally Efficient
When material costs rise, the last thing you want is to have inefficiencies undermining your business. This is the perfect moment to sharpen the knife of your operations. Implementing lean manufacturing principles or revisiting your workflow can reduce unnecessary waste and improve throughput, helping you offset rising input costs.
Take a hard look at your processes—where can you streamline? Where are you using more steel or aluminum than necessary? Whether it’s adopting automation technologies or rethinking the production process itself, there’s always room for improvement. Investing in smart manufacturing technologies or software can also yield long-term savings by optimizing inventory, reducing scrap, and improving overall productivity.
Get Strategic with Your Supplier Relationships
The relationship you have with your suppliers is not just transactional; it’s strategic. Now more than ever, those relationships should be nurtured and negotiated. Work with your suppliers to lock in favorable contracts, especially if you can commit to longer-term agreements or higher-volume orders. This not only gives you a price guarantee but can also help you better predict costs in the face of ongoing tariff fluctuations.
Think of your suppliers as partners in navigating these turbulent times. By consolidating purchases or exploring joint ventures, you can secure better pricing and terms. Remember, the more you work with a supplier, the more leverage you have when it comes to pricing and delivery terms.
Consider Price Adjustments…Carefully
Raising prices in response to higher material costs can be a delicate balancing act. Especially for those coming through the high inflation of the Biden Administration having already raised their prices.
While you don’t want to alienate customers, you also can’t absorb all the cost increases. The key is to approach pricing adjustments with precision. Take time to understand your customers’ price elasticity—what will they tolerate, and what will drive them to seek alternatives?
Transparent communication is vital here. Be clear with your customers about the reasons for price hikes, particularly if they’re due to external factors like tariffs. Many customers will understand that prices need to rise, but they also want to see value in return. Focus on what makes your product stand out—quality, service, and reliability—and reinforce that value proposition when making the case for price adjustments.
Diversify Both Products and Customers
If you’re feeling the pinch from higher steel and aluminum costs, this may also be a good time to diversify your product lines. Look for areas where your core competencies can be applied to new markets or where you can innovate with alternative materials that are less impacted by tariffs. A diversified product offering not only helps mitigate the risks of any one market or material becoming cost-prohibitive but can also open up new revenue streams.
At the same time, expand your reach to new markets. Whether it’s exploring international markets where U.S. tariffs don’t apply, or tapping into niche industries that aren’t as reliant on steel and aluminum, there are plenty of opportunities to broaden your customer base. Diversification isn’t just about products; it’s about market resilience.
Get and Stay Acquainted with Tariff Policies
You don’t have to face the brunt of tariff policies alone. Monitoring and advocating for changes in trade policies is essential. Tariffs aren’t static, and as political climates shift, so too can the landscape of trade restrictions. Being engaged with trade associations (NSSF), industry groups, and other advocacy organizations can give you a voice in shaping policy and staying ahead of any future tariff adjustments.
Advocacy might also open the door for tariff exclusion requests or other forms of relief. Keep an eye on potential changes in trade policy, and don’t hesitate to lobby for a policy that works for your business.
Making It Through
The newly imposed 25% tariffs on imported steel and aluminum present a clear challenge to small and mid-sized manufacturers, but also a chance to demonstrate agility and innovation. By strategically managing your supply chain, investing in operational improvements, negotiating with suppliers, adjusting pricing strategically, and diversifying product lines and markets, you can weather the storm of increased material costs. And with the right government support and proactive engagement in advocacy, your business can not only survive but thrive in the face of these new tariffs.
Yeah, that’s a tall order but 25% tariffs on imported steel and aluminum may leave many companies with little choice but to tackle the issue head-on.
— Paul Erhardt, Managing Editor, the Outdoor Wire Digital Network
