Even when tariffs aren’t directly applied to UK businesses, the ripple effects reach them through higher prices for imported goods, disrupted shipping routes and greater uncertainty in customer demand. For SMEs already working with tight margins, these shocks create serious financial strain. LogisticsManager.com found that 68% of UK manufacturing and logistics SMEs say tariff changes have had a high impact of their short and medium-term investment plans, showing how widespread the issue has become.
The Knock-On Effect: Cash Flow Under Strain
It’s no secret that tariffs increase the cost of goods while disrupting cash flow. SMEs are being squeezed between suppliers who want faster or higher payments and customers who delay settling invoices. With rising costs for warehousing and fuel, the gap between money going out and money coming in is widening. Many small logistics firms report that their sales pipelines and investment plans are being directly affected by tariff-driven pressures in 2025. Worryingly, LogisticsIt.com highlight that 15% of logistics SMEs believe they may have to cease trading within the next 12 months if these conditions persist.
Adapting Supply Chains to Reduce Exposure
There are steps SMEs can take to minimise their risk. Diversifying suppliers across different regions can reduce reliance on tariff-affected routes. Renegotiating contracts to include tariff pass-through clauses ensures costs aren’t carried solely by the logistics provider. Businesses are also turning to technology-driven efficiencies such as smarter route planning and real-time tracking to offset higher costs elsewhere. These measures won’t remove tariff impacts completely but we’ve seen them provide some relief.
Protecting Your Business with Proactive Debt Control
One area that SMEs often overlook is the importance of strong debt control. Late or missed payments can be devastating in an already pressured environment. By tightening credit terms, monitoring debtors more closely and acting quickly on overdue accounts, SMEs can shield their cash flow from worsening problems. Effective debt management is less about pursuing payments and more about protecting your business against global shocks. We see this in practice with our clients like T. Worthington & Son, a family-run self-storage business, who had been chasing a debt for over a year until our targeted recovery strategy secured full payment within two weeks. With their cash flow restored, they could continue operating without disruption and their experience shows how proactive debt management supports resilience in uncertain times.
Redwood Collections as a Trusted Partner
We work with businesses in shipping & logistics who are facing these challenges. Our team specialises in recovering overdue payments and giving SMEs the confidence their cash flow is protected. By taking the burden of debt recovery off your shoulders, we allow you to focus on keeping supply chains moving. In a year shaped by tariff uncertainty and financial pressure, we provide the support that helps your business remain resilient and competitive.
To find out more, visit our dedicated shipping & logistics page.
