Tariffs and Technology: How This Impacts Your Business
President Donald Trump’s recent tariffs are poised to significantly impact the technology sector. No more so than in areas, such as hardware procurement, cloud computing and your business’ general IT costs.
Like many industries digital technology is built on a global supply chain, and disruptions to this cause massive consequences. A prime example of this was the semiconductor shortage during COVID, which caused product shortages and price rises beyond just tech and computers, but also in the automotive and aerospace industries.
These tariffs underscore the necessity for businesses to proactively assess and optimise their technology infrastructures to mitigate potential impending cost increases and risks during a recession.
There has never been a better time to have a trusted full-service digital technology provider, such as Shoothill, as a partner to your business, we’re equipped to navigate the choppy waters. Today we’re giving you an overview of three main areas within technology, where businesses may stand to be impacted.
Rising Hardware Costs and Their Implications
The newly imposed tariffs include a steep 125% duty on imports from China, which remains in effect. However, previously announced tariffs—46% on Vietnamese products, 24% on Japanese imports, and 20% on goods from the European Union—have been suspended for 90 days following last night’s announcement.
Given that a significant portion of global hardware components are produced in these regions, companies like Apple, which manufactures around 90% of its iPhones in China, are particularly exposed. Analysts caution that the sustained tariff on Chinese imports could drive electronics prices up by as much as 40–50%, with downstream effects likely to ripple through sectors that rely heavily on advanced hardware.
Impact on Cloud Computing Services
The tariffs are also expected to affect the cloud computing industry. Higher costs for hardware components, such as semiconductors and servers, may lead to increased expenses for data centres.
These additional costs could be transferred to consumers through elevated prices for cloud services, such as data storage, hosting and of course subscription based software platforms ranging from COINS and Hubspot, to Netflix and Spotify.
A Strategic Response
In light of these developments, there are a range of places businesses can look to prepare for this market, which the Shoothill team are well prepared to help you with.
Comprehensive technology audits: We offer in-depth assessments of your current technology assets to identify areas requiring immediate attention or upgrades, ensuring your infrastructure remains robust and cost-effective.
Proactive procurement planning: Leveraging our industry expertise, we can assist in advancing the acquisition of essential hardware before price increases take effect, helping you manage budgets effectively.
Cloud service optimisation: Our team will work with you to evaluate existing cloud service agreements, exploring options to lock in current rates through long-term contracts and identifying opportunities for cost savings.
By partnering with Shoothill, businesses can navigate the financial and operational implications of the new tariffs effectively, maintaining operational efficiency and securing their technology investments against rising costs. Speak with the team today.