As global trade becomes increasingly shaped by geopolitics and policy volatility, manufacturers are no longer asking if they need to adapt, but how fast. Faraz Malik Shaikh, CEO of Figo Home, sat down with DevX to discuss how companies are navigating new tariffs, rethinking supply chains, and turning trade uncertainty into a strategic advantage.
With a background in enterprise risk management and deep operational experience running a direct-to-consumer brand, Shaikh offers a unique view from the intersection of finance, operations, and innovation.
Rebuilding Supply Chains in Phases
According to Shaikh, companies facing new tariffs typically adapt in clear stages. “The initial reaction is to over-order from tariffed countries to build up inventory and delay price hikes,” he explained. “That creates a buffer while executives assess the policy landscape.”
Next comes a gradual shift to suppliers in non-tariff regions, which includes vetting partners for cost, quality, and delivery performance. “This phase is critical,” Shaikh said. “It’s about testing the waters, which includes splitting orders and closely monitoring whether the new tariffs are temporary or long-term.”
If new tariffs appear permanent, supply chains reconfigure more decisively. “That’s when companies double down on new sourcing relationships and reshape their entire procurement strategy.”
Nearshoring Semiconductors and Its Challenges
Shaikh pointed to the semiconductor industry as a case study in nearshoring under pressure. “There’s been a clear push to bring production closer to home, especially after COVID-19 exposed how fragile global supply lines were,” he noted. While nearshore fabs promise faster access and logistics savings, challenges remain.
“Even at full capacity, the U.S. produces less than 15% of global chip demand,” he said. “Scaling onshore is difficult; labor shortages, rising costs, and sustainability hurdles make it slow and expensive.”
Despite these issues, the trend toward regionalized production is gaining momentum as companies prioritize resilience over pure cost efficiency.
Mexico and Southeast Asia: Emerging Winners
Shaikh cited Mexico and Southeast Asia as standout players when asked about shifts in regional manufacturing hubs. “There’s been a surge of Chinese investment into Mexico, taking advantage of USMCA access to the U.S. market,” he said. “It’s proximity plus policy—companies can respond to consumer demand faster and reduce freight costs.”
Meanwhile, Southeast Asia offers low labor costs and maturing infrastructure. These regions provide manufacturers with viable alternatives to China-based production, especially as tariff structures evolve.
Innovation Over Cost-Passing
Contrary to expectations, many companies have avoided passing costs onto consumers. “You don’t see a dramatic spike in prices because many businesses stocked up in advance,” Shaikh noted.
One firm that stood out to him was Keen Footwear. “They opened an automated factory in Kentucky, cutting reliance on imports and centralizing production. It’s a great example of how companies use automation to innovate, not just react.”
Who Wins When New Tariffs Hit?
While some domestic industries benefit directly from new tariffs, like steel, others become “unintended winners” by solving pain points caused by policy shifts. “Robotics and automation companies are a perfect example,” Shaikh said. “As labor becomes more expensive and harder to find, automation becomes the answer.”
New tariffs can also spotlight underutilized domestic capacity. “Industries already set up for quick scale-up—like steel—can seize the moment when barriers go up,” he added.
Adapting to Tariff Threats with Technology
Resilience, Shaikh stressed, comes from diversification.
“Avoiding concentration risk is key. Companies that dual-source or have visibility into their supplier dependencies can respond faster,” he said.
Technology plays a significant role in these strategies. “AI-driven lean production, automated systems, and R&D investment to replace tariffed raw materials are all ways to mitigate cost pressures.”
Still, the upfront investment is significant, and not every company is positioned to act quickly. “Confidence in the long-term policy environment is still lacking,” he noted.
Lessons from Reinvention
Shaikh was clear when asked what business leaders should take away from the past five years: adaptability wins. “From COVID disruptions to inflation and global tariffs, the companies that thrived were the ones with a dynamic, risk-aware mindset.”
For those willing to act early, tariffs can become a trigger for modernization, not just a hurdle. “This isn’t just about dodging taxes. It’s about using disruption to upgrade how you operate,” Shaikh said.
Rashan is a seasoned technology journalist and visionary leader serving as the Editor-in-Chief of DevX.com, a leading online publication focused on software development, programming languages, and emerging technologies. With his deep expertise in the tech industry and her passion for empowering developers, Rashan has transformed DevX.com into a vibrant hub of knowledge and innovation. Reach out to Rashan at [email protected]
