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New import tariffs are squeezing hardware costs and complicating procurement — MSPs must respond with strategy, not panic. Below are concise questions and answers MSP leaders can use to adapt pricing, supplier talks, and customer communications right away.
Review your contracts and current inventory immediately; that gives you the clearest short-term picture. Start by auditing purchase orders, pending shipments, and stock on hand so you know which deals are already locked at older pricing. Flag upcoming purchases that will be affected and quantify the margin impact per client or service. This data lets you prioritize which contracts to shield and where to negotiate. It also stops knee-jerk decisions driven by headlines and focuses action on measurable risk.
Not automatically — lead with transparency and options for customers. Explain cost pressure clearly and offer choices: lock-in pricing with a longer term, absorb small increases temporarily, or move to a cost-plus model for hardware resale. Use data from your audit to show exact impacts by service line. Small, targeted increases tied to concrete cost changes are easier to justify than broad rate hikes. Always pair any price change with a value reminder about continuity and security you deliver.
Focus on value and flexible terms rather than purely competing on price. Create bundled packages that shift hardware cost risk or offer financing terms to smooth client payments. Negotiate volume discounts or extended payment windows with vendors to protect margins. Consider revising SLAs to align support tiers with pricing, making higher-margin services more visible. Clear communication and options reduce churn while protecting profitability.
Start renegotiations now — vendors want to protect relationships during market stress. Use tactical empathy: listen, label their constraints, and ask calibrated questions about flexibility or bundling. Propose mutual benefits such as longer commitments, consolidated purchasing, or forecasting demand to secure better terms. Document any concessions and update SLAs to reflect new commitments. Early, cooperative talks yield better outcomes than last-minute pressure.
Use tactical empathy and data to make your case — emotions matter as much as numbers. Mirror vendor language, label their position, and ask questions like “What options do we have to lower unit cost?” Offer predictable demand or consolidated deals in exchange for price or lead-time concessions. Emphasize shared risk and the cost of lost business to make the trade-offs clear. Keep negotiation win/win to sustain long-term supply stability.
Be upfront, concise, and solution-focused in client communications. Explain the specific hardware or service lines affected, the expected timing of changes, and the options you’re proposing — e.g., temporary absorbency, phased price adjustments, or contract extensions. Provide concrete numbers where possible and a recommended next step for each client. Reassure customers that service quality and incident response will remain priorities. Transparency builds trust and reduces surprise-driven churn.
Yes — diversify sourcing, hold buffer stock, and standardize hardware platforms to increase flexibility. Identify alternate suppliers in non-affected regions and pre-approve them in procurement policies. Increase inventory for critical items where carrying cost is less risky than service disruption. Standardization lowers support costs and makes substitutions faster when shipments are delayed. These operational shifts reduce single-point vulnerabilities.
Repackage where it makes sense — shift risk away from low-margin items and toward recurring services. Make managed services the center of your offering and treat hardware as a complementary, transparent line item. Introduce tiered SLAs or premium support that bundles better margins with faster response. Consider financing or leasing options for larger hardware projects to smooth client payments. Strategic packaging increases predictable revenue and corona- protects margins from commodity shocks.
Tariffs force you to re-evaluate supply-chain assumptions and margin models; incorporate scenario planning now. Add tariff-impacted cost lines into three- to five-year financial forecasts and run sensitivity analyses on vendor price shifts. Use these scenarios to guide vendor consolidation, contract length, and capital allocation decisions. Treat tariffs as part of normal risk modeling rather than a one-off event. That discipline makes your business more resilient and investor-friendly.
Switch when total cost of ownership, including lead time and support, favors the new supplier. Consider not only unit price but import duties, shipping delays, and compatibility with your tooling and processes. Run pilot projects with alternate vendors before wide adoption and measure serviceability, return rates, and support response. If switching lowers risk and preserves margins without degrading service, make the change. Always keep a rollback plan in case the new supplier falls short.
Trust is the core asset — lead with it whenever costs or timelines shift. Be explicit with clients about what you can and can’t control, and document any temporary changes to delivery or pricing. Use transparent billing for hardware and show audits or purchase receipts when needed. A reputation for candid communication reduces pushback and positions your firm as a dependable partner. That credibility is worth more than a short-term margin win.
A: Start reviewing contracts now and prioritize those up for renewal in the next 90 days. Short-term fixes can include addenda that clarify hardware price pass-throughs. For long-term renewals, adopt clearer terms around cost adjustments and notice periods. Always discuss changes with clients before unilateral updates. Document consent and keep a record of communications.
A: Passing the full cost is possible but risks churn; consider a phased or shared approach first. Use transparent breakdowns to justify any pass-through and offer alternatives like financing or locked pricing. Analyze which customers are most price-sensitive and tailor solutions. Smaller, targeted increases tied to specific hardware lines are easier to accept. Track churn risk and adjust strategy as needed.
A: If a supplier is inflexible, explore volume consolidation, alternate vendors, or longer commitments in exchange for concessions. Consider buying forward or increasing inventory for critical SKUs. If those aren’t feasible, repackage services to make hardware costs explicit and optional. Keep negotiations collaborative — threatening to switch rarely yields the best outcome. Maintain parallel sourcing plans to reduce leverage loss.
A: Use simple, business-focused language: explain that new duties slow or increase the cost of specific items, name the affected hardware, and offer concrete timelines or alternatives. Avoid jargon; show what you’re doing to mitigate the impact and a clear recommendation. Reinforce the continuity plan and any SLA adjustments. Provide a single point of contact for questions to keep communications consistent.
A: It depends on the item’s criticality and carrying cost; buy buffer stock for mission-critical hardware but keep lean inventory for fast-depreciating or high-carry-cost parts. Perform a cost-benefit analysis comparing carrying costs to the risk and cost of service disruption. For some SKUs, paying slightly more to avoid downtime is worthwhile. For others, adopt just-in-time procurement and alternative sourcing. A mixed approach balances risk and cost effectively.
For more MSP playbooks and pricing guidance, see Palisade.
