2026 has been full of major tariff-related developments, such as the February ruling by the Supreme Court and the escalating tensions around the Strait of Hormuz starting in March. Through it all, a baseline 10% tariff has remained in effect, providing a consistent pressure on small and midsize businesses (SMBs) to operate on thinner margins during a period of structured volatility.
At the time of Netstock’s first Tariff Impact Report in May 2025, nearly two-thirds of SMBs expected moderate or major disruption, while almost half reported having never implemented a tariff mitigation strategy previously. Most were watching, waiting, and searching for clarity within their own inventory and supply chain projections as tariff deadlines approached.
Drawing on new survey data from Netstock's 2026 Tariff Impact Report, findings point to a sector undergoing active transformation on multiple fronts. Today, more than half of SMBs report that the tariff impact on their supply chain is greater than it was 12 months ago. Within that group, more than 20% describe it as "much greater."
The businesses reporting improvement (21%) offer a useful signal: tariff impact is not uniform.
The underlying driver hasn't changed either. In 2025, 70% of SMBs cited increased costs as their top tariff concern. This year, 72% cite cost-related challenges, with increased landed costs leading at 56%, followed by margin pressure at 16%. The appearance of margin pressure as a distinct category is notable. It suggests that tariff costs are not simply being absorbed or passed through in full, but are settling into a gray zone where businesses bear some of the burden while pushing the rest downstream. The result is thinner margins on both sides of the transaction, a dynamic that makes accurate cost visibility and pricing intelligence increasingly important.
Key takeaways:
· Cost is the No. 1 issue held virtually flat year over year (70% to 71%), but the 2026 data reveals margin pressure (16%) as a distinct second-tier pain point. 82% of SMBs report that tariff-related cost increases have led them to pass costs on to customers. The primary mechanism is direct price increases, cited by 92% of respondents. Surcharges, reduced discounts, and product mix adjustments play smaller roles. The shift from absorption to passthrough is now seemingly less a strategic choice and more a financial necessity. However, it creates a secondary challenge worth monitoring: when more than eight in 10 SMBs raise prices, the cumulative effect moves through the supply chain.
· The move from cost absorption (44% in 2025 Benchmark data) to cost passthrough (82% in 2026) is a notable pricing shift that customers across the supply chain may increasingly see this year.
· A year ago, more than half of respondents (57%) cited a "wait and see" strategy for tariff uncertainty. Given that 47% hadn't previously implemented strategies to manage tariffs in their supply chain, the cautious posture made sense. The 2026 data reflects a significant shift. Only a year into operations amid cyclical tariff volatility, the SMB sector has almost entirely moved to proactive mitigation measures. Less than 3% of respondents report no active strategy, and nearly six in 10 are deploying two or more simultaneously. The wait-and-monitor approach has dropped from 57% to 21%, the sharpest single decline across any strategy tracked in the dataset.
· Nearly half of SMBs now report impacts from two or more sourcing regions simultaneously. For businesses accustomed to managing a single primary supplier relationship, this multi-front exposure represents a fundamentally different planning challenge, one that requires broader visibility into cost, lead time, and risk across the supplier base.
· 74% of SMBs identify China as their most-impacted sourcing region. Europe follows at 30%, Southeast Asia at 25%, Mexico at 17%, Canada at 10%, and Latin America at 9%. India, not a standard option in the survey, appeared as a write-in from 8% of respondents.
· 35% of respondents have changed suppliers due to tariffs in the past 12 months. Cost increases were the primary driver (44% of those who switched), followed by country-of-origin risk at 26%, supplier reliability issues at 15%, and tariff-driven lead time changes at 11%. Cost remains the top trigger for switching, but the fact that country-of-origin risk now drives more than a quarter of changes suggests SMBs are increasingly building for resilience, not just reacting to price.
· Of those managing tariff impacts across multiple sourcing regions, one-third have already changed suppliers, and 43% cite supplier diversification as an active strategy. As sourcing challenges compound across geographies, SMBs are building new supply lines, even when it means searching within new geographies.
· Nearly three-quarters of SMBs (73%) say tariff uncertainty has pushed them to plan their inventory further out than before, with 29% noting the shift has been significant and 44% reporting a more modest extension.
· 73% of SMBs have extended their planning horizon, but 62% were still under-planning based on actual inventory results. The gap between "planning further ahead" and "planning effectively" is where the right analytics and demand sensing tools become critical. SMBs relying heavily on analytics more than doubled, from 8% to 19%, while non-users fell from nearly a quarter of respondents to just 7%.
· When asked how a hypothetical tariff refund would affect their operations, 49% of respondents described the impact as "meaningful" or "game-changing." Another 34% called it "helpful." Only 3% said it would be negligible.
· 82% of SMBs feel more prepared than a year ago, a strong signal that a year of operating under tariff pressure has resulted in Main Street understanding how to operate under adverse conditions. But 49% say a tariff refund would meaningfully change their financial position.
· 82% of respondents say they are better equipped to respond to tariff disruptions than they were 12 months ago, with 36% describing themselves as "much more prepared." 18% report no change.
