Name: Global Trade Braces: Navigating Unpredictability of Potential Tariffs
Uploaded: 2025-04-03T14:16:04.492Z
Duration: 54 min 32 s
Description: Global Trade Braces: Navigating Unpredictability of Potential Tariffs

Transcript for "Global Trade Braces: Navigating Unpredictability of Potential Tariffs": Hello, everybody. Hello, Tobias Silva. Can you hear me? Yeah. Can you hear me? Great. Great. Great. Right. Let's just wait for more people to join. It's still a little bit early, and, we'll just give people the chance to connect. Sometimes with a new portal, it's not always so quick. You can't be early enough in times like this, Christine. Right? Well, it's moving. Especially considering our topic. It was an interesting wake up this morning, grabbing my phone to read the news. Oh, definitely. Right? It's hard to keep up, really. I mean, that that might be part of the plan. We'll see. We'll see. Can't wait to hear more about that. Yeah. Right. Let's give it a few more seconds before we go. Right. Let's kick it off, because we have a lot to talk about today and, we want to use every single minute of this conversation to get the most value out of it. So, I would like to welcome everybody to today's webinar. Today we are talking about Global Trade Braces, Navigating the Unpredictability of Potential Tariffs. We're so excited that you could join us today. Thank you for taking the time. My name is Christine McKechnie and I'll be moderating today's event. I'm the director of solution advisory at Cooper and I help our customers to gain business value from all our solutions. So in today's interconnected global economy, trade tariffs and geopolitical dynamics can significantly impact supply chain operations. This webinar will provide you with valuable insights and practical strategies for supply chain procurement and finance leaders to navigate the complexities and the unpredictable nature of potential new global trade tariffs. Today, I have with me Doctor Tobias Endler, our external guest, who is an author and expert on US domestic and foreign policy. Welcome, Tobias. Thanks so much for having me. Thank you. And we also have Samba Lombardo, our Chief Product and Technology Officer at Cooper. Hello, Tolda. Hello. Good. I will introduce our esteemed guest properly soon. But before we get started, please allow me just to mention a few housekeeping items. The session is being recorded and we will distribute this later. We are also going to make available all the slides that we share with you today. We encourage you to use the Q and A section on the right hand side within the webinar platform to submit your own questions. We are going to try and answer these questions during the webcast, but if we need to provide you with a fuller answer or if we run out of time, we will provide those answers later via email. So please do know that we are capturing all these questions. And with that, let's get started. To frame things up a bit, let me give an outline of what we are going to discuss today. We are first going to hear from our guest speaker about the impact of The US trade policies on global supply chains and the associated ramifications thereof. Specifically, what we want to know about are the changes to the global trade tariffs proposed by The US or introduced by The US today and the expected global response to that. We also want to understand the impact of global trade tariffs on supply chain operations and procurement. Then we are going to hear from our own Cooper, Chief Product and Technology Officer Salva, about strategies for mitigating the effects of these tariffs on sourcing, procurement, production, and logistics. And also leveraging supply chain modeling techniques and prescriptive analytics to design resilient supply chains to withstand these disruptions and to become adaptive. Finally, we are going to conclude with a discussion with our two experts on this call today. The content that we are going to cover on today's session is also mentioned throughout our landing page on coupa.com, focused around tariffs and adaptive supply chains. Please do go and visit those sites. Let me just click on and get to our agenda. So why is this topic so interesting for us? Right. On the January 13, Forbes published an article on the risks that surveyed executives are worrying about the most in 2025. The concerns about a variety of geopolitical risks, any one of which could create a crisis, are amongst the major worries of corporate executives around the world. To quote from the report, close to half of the surveyed CEOs consider intensified trade wars to be the leading conflict related geopolitical business risk in 2025, followed by foreign cyber attacks and an increased risk of conflict in Asia Pacific. And then also issues directly related to concerns over the rising tensions between The US, The EU, and Canada. This is according to the C suite Outlook 2025, which was released on the January 13 by the conference board. And as we all know, a lot has changed since January and over the last few days. To help demystify what the issues are and how they impact us, we have our esteemed guest speaker with us. Doctor Tobias Endler is a political scientist and American studies scholar specializing in US domestic and foreign policy, transatlantic relations, and contemporary democratic discourse. He earned his doctorate from the University of Heidelberg and has held research positions there and at Yale University. Currently, Tobias works as a freelance speaker, moderator, strategic consultant and author. I would like hand to hand over to Doctor. Endler to talk about The US global policy impact on supply chains. Tobias is our external guest speaker today. His opinions are his own and we've invited him as a guest to share his valuable insights with us today. Thank you, Tobias. Well, thank you very much, Christine. This was this was a beautiful introduction, the kind of introduction that my mother would have liked, I guess, and and my father would have believed probably. So, thank you everybody out there for taking the time and for joining us today, taking the time out of your busy schedules, and to think along with us and share your perspectives. Thank you so much for having me to the perfect, Cooper team, to John, Sophie, Nari, Christina, of course, and hello, Salva again. It's good to see you, and I hope there's no screen in between next time we meet. Well, it's April, and one day after the US administration declared a national economic emergency, and announced massive tariffs on dozens of nations, as I'm sure we've all seen this morning. They're supposed to kick in over the next couple of days. Some of them astonishingly high. This includes tariffs on some Antarctic islands, by the way. They are not inhabited except for penguins. But on a more serious note, the auditaries, as we know, are now in effect, for example. This is very different. Let me just state from the first Trump terms. Some economists have said it basically comes down to overturning the Bretton Woods system. So in other words, the foundations of the post World War II economic order, if you want. So the world feels very different for a lot of us today. Now let me do something that we should maybe never do in any speech and start off with a platitude. We have always lived in times of uncertainty. International trade has always known a level of unpredictability, given the myriad of factors that are involved as we as we all know in trading across borders and around the globe. What is different now, I would argue, is that we're seeing unpredictability being employed as a strategy. It's a means to an end. This is a mere observation as of now, not so much a judgment. And again, we've seen this one before. Just think of Richard Nixon, for example, and his Mad Men strategy back in the day, where the other side never really knew how far he was going to go and wasn't supposed to know, really. What is really actually new, I would argue, and I'm happy to discuss this in more detail in the discussion, is unpredictability now applies to an unseen degree to economics and trade across the board, basically. What's also known is that trade and security policy are closely intertwined. And this holds true both with regards to, you know, traditional allies and strategic competitors such as China or other nations. Tariffs, and I'm sure we'll get back to this in a second, are being used in a different and somewhat unusual way as a means to an end by now to achieve strategic goals. And again, I'm not judging. I'm just observing. Often these goals are security policy related, like think of the Mexico border issue, for example. What this means is that this might affect our supply chain reliability even if your specific supply chain has zero to do with that specific Mexico border problem. And I'm sure we're gonna get back to this. So as a consequence, unpredictability applies to an unusual degree, I would argue, with regard to the nexus between tariffs and supply chains. Having said that, there is substantial we shouldn't forget there is substantial continuity between the previous administration and the current administration in many areas. And I'm happy to talk about the details of the IRA, Infrastructure and Investment Act if you want me to. The IIJA does the Infrastructure Investment and Jobs Act and other initiatives that the Biden administration has launched, and big parts of which will be kept in place, even though it wasn't announced that way. So we can track this continuity actually over the years along the laws and executive orders and supply chains specifically, that various administrations have put into effect. Why why do I mention this? Because supply chain regulation, if you want, actually helps us understand the bigger picture of the overall situation, which I think is a nice way to look at matters. Just some quick examples in 2012. For example, the Obama administration, brought out what I just looked this up before the seminar called the National Strategy for Global Supply Chain Security. That was back in 2012. In 2017, during the first Trump administration, when we had basically just come into office, he brought out an executive order on assessing and strengthening the manufacturing and defense industrial base and supply chain resiliency of The United States. So it was was out there back then already. You can look up all of those on the White House website, obviously. In 2020, still, Donald Trump administration brought out the Defense and Production Act, again, regarding international development, but also supply chain reliability. And in 2021, Joe Biden barely come into office, came out with what they termed a building resilient supply chains initiative, revitalizing American manufacturing and fostering across the board growth. Again, the crucial difference is, we saw an intention, I would argue, in those years to solidify supply chain reliability through the law, if you want, by shoring up, by securing supply chain reliability through executive orders and through laws. And this includes former Trump, executive orders and administrations. This was never altruistic to be sure, but always with The US market in mind first, of course. But it was a signal of reliability and accountability both towards Americans at home and the outside world and their trading partners. Today, signs are a little different. I would argue the writing is is on the wall pretty much. This is openly about about different goals about moving The U. S. Market in a different direction. I think some of it can be argued for. Fair enough. Some of it is maybe more challenging to argue for. So just a very quick run through concerning the tariff policy of the second Trump administration that Christine announced, that we have seen since January 20. I'll be happy to talk about details in in in the discussion, obviously, and and also obviously about the most recent tariff policies from this week that are basically coming into effect as we speak. So the core tariff policies of the administration cover round about 800,000,000,000 US dollars of US imports. And this is expected to double after yesterday, basically, with the new tariffs on cars and car parts coming into effect, among other things. But I think that's the main the main chunk. So far, I would argue we have seen a mix of four categories, for lack of a better word, categories of tariffs, so maybe states of tariffs. There have been tariffs tariffs proposed, such as the one on cars and car parts, which has now come into effect 25%. Another one is the the one on agricultural goods globally coming into The United States. It's unclear as of now just how high it's going to be. There have been a number of so called reciprocal tariffs across the board, and we'll get back to them in a second, coming in this week as we speak. And there have been proposed tariffs on computerships and pharmaceuticals, somewhere in the area of 25% globally, but no date set yet for when these are going to come in. We did have a number of enacted tariffs, obviously. Starting, all of this basically took place in March already. 10% on all goods from China. Beginning Of March, jumping up significantly now, as we also this morning. 25% tariffs on all goods from Canada and Mexico of all places. So the two biggest and closely intertwined trading partners of The United States. With the exception of energy, 10% on energy and and I think 10% on fertilizers, as well. And then, of course, the restored 25% on steel and the elevated tariff to 25% on aluminum, globally coming in also. All of this in large. Other tariffs have been delayed, have been announced and delayed again, announced and delayed again. But some of this is going going to come in, especially for goods compliant with USMCA, what used to be NAFTA. Some very few tariffs have been dropped in the meantime already, like the one like the blanket tariffs, for example, that Colombia was facing, 25% for its immigration policy. Now, against a Picasso like background, I would say, of so many moving parts, some of them quite colorful, I think improving supply chain reliability becomes critical. And I'm sure Salve, as a true expert here, will have a number of exciting things to say. In a second, let me just state that supply chain reliability, from my point of view, requires proactive thinking. So I'm I'm convinced that reading the mind the mind, if you want, of a very business oriented administration, as is currently the case, is crucial. And I would argue that someone from the business world is maybe ideally positioned to do so and possibly better than, say, a lifelong politician or a professional journalist will be able to do so. Supply chain reliability also requires building strategic coalitions. And this includes developing alternative supply chain opportunities. And the, obviously, like the challenging factor is going to be China here. And I think we're probably going to touch on China in the discussion. And I would also like to mention a somewhat softer issue. If you want, we have to consider what what I would like to call the ratio emotion factor in trade. And this goes back to behavioral economics, Richard Thaler, Cass Sunstein, people like him. It's just the fact that in most cases, people do not act rationally, and they will base their decisions. And this includes trade policy, not so much on naked facts and the sensible thing to do if you want. And we need to take this into account. So thank you very much, for now. I look forward to the discussion. I'm very curious to hear what the most sensible man of all, Salva, will have to say in a second. So thanks so much up until now. Christine, you're still muted. I think I can't hear you. Thank you so much. Yes. Thanks for pointing that out. I'm so glad that you shared those insights with us. I have to say, you know, as I mentioned when I read the news this morning, I had a bit of a shock and I felt a little bit scared. So I fully relate to this emotional reaction that you've just referred to. But, yes, certainly, you know, some of what you have painted and what we are reading is actually very scary for us. On the other hand, the the good news is here is Solva to actually, to understand what we as Cooper can potentially help you with, to deal with as all those challenges and the uncertainty that is coming, from all of that. So, let me just quickly make sure that I'm sharing properly. The network seems to be a bit slow. Please do indicate if this is working. Nope. Let me try again. There we go, and that should work. Give me a second now. There we go. Good. Excellent. Right. And so with that, I would like to introduce Solva. So Salvatore or Solva, Lombardo is our chief product and technology officer at Coupa. Salva drives our company's innovation roadmap. Previously, Salva was the chief product officer at SAP Ariba, and there he led the global product and engineering teams. Salva has a master's degree in business informations and administration from the University of Manheim. Salva, hereby I'm handing over to you. Yeah. Thank you so much. And Tobias, thank you for that part. I was, you know, every every time I listen to you, I'm actually, increasing more and more, the knowledge into this topic. It's it's amazing how much, you are absolutely on top of all those changes. But, you know, before I get started, I need to quote, your moment, in the speech you had, because it fits quite nice also to the quote of our brilliant CEO too. So Tobias, you used, at the very beginning, you used the words unpredictability as a plan. So it could be. Right? What you, meant also on what is happening at the world at the moment. And I think that that that sums up the whole situation when you come now and see this from a business perspective. Because if there is something in business which makes it hard, to manage, it's the moment you have not really a plan on how things can go and how to react to them. And I think the only answer is, and that's why this quote is missing so nicely into it, Those who optimize fastest will win. And this quote simply says, if you have a plan, it's nice. But if you don't have a plan, you need at least to make sure that you are fastest enough on getting to the plan by getting all the parameters you have basically available. And I think that's all about also why, at Cooper, at least, this is what we are trying and and delivering as products to make this possible for you. And this is why I think, the point on what we made on especially when we come to tariffs, where we where we are going, are basically and if we progress the slide to the tariff, fragility. Christina, do you oh, yeah. Perfect. You can open the slide. Yeah. So if you look on where, those tariffs are having obviously an impact, one is super clear. We can and have fragile supply chains. There is no doubt. Tobias also touched them, and, especially also the materials and flows which we were seeing. But if you see that, this is not just one thing going on. If you look at the geopolitical factors overall, and it it it comes also to political environments, there are countries where you also just because of uncertainty in those countries. Forget the moment the tariffs, you are going to be in question. Do you supply from there or not? Is it, is the supply fair enough? What about climate climate disruption, risks when it comes to and we have seen a lot also during COVID and other, you know, climate changes, in parallel to the COVID time, or even getting stuck of boats in some or the other, channel or, places, but also all labor challenges which we have. And in addition, and this is, and you touched it also very, very, rarely there, but the cyber security, area. So where and how can I really act freely, in different markets and where not? And where where do I have regulations, which again are holding me back from where to buy from or where to also make or with whom to make business. And I think all of those are basically also adding up to the four pillars of, where we would say, the barriers of the future are lying. And, Christine, we can progress to the next slide. So what we see as the four pillars of, when we come back to the tariff situation is we need to rethink obviously, absolutely, the manufacturing, sourcing, and logistic part. There is no doubt. This is a barrier where if we do not, basically every day think about is it still the right way on how a supply chain how my supply chain is looking like, I'm in that moment already behind. In the moment, I think I'm done. I think the second thing is the the lack of agility for the responses. Right? So the the point is and, Tobias, I don't remember if you said weekly. I guess you did, that we have in weekly, a rhythm changes in the situation at the moment. I mean, you follow it more than me, I guess, on, you know, be it 20%, be it to 25, be it announcing, and and, you know, waiting and shifting. So this is the point where agility kicks in. If I don't have a response to this, I'm heard even from one of the CPOs just in a later call. One of his trick is he just waits. I'm just saying. I mean, this is the tactics at the moment. They just said to me like, I'm waiting, Salva. I'm just waiting because, you know, before, at least a week has not passed. That's why it fit so so good to your quote. I hope it was a week to be as then the thing fit here. But, then the, it is unpredictable for me to just change things. And, obviously, it was a smart move at the moment to wait before you, you know, before you trick in something, but at least you need to be able to do something then at least after a week. Now the traditional planning tools obviously, are the one which is also very, at the moment, holding back, holding back all of the, I would say those agile scenario plannings. Not every company is in the situation to do this, in a very fast manner, as the scenarios need to basically, in many departments, be manually calculated or, you know, with thousands of calls into the different supplier basis and sourcing and internal, areas. Then, obviously, at the end is also the lack of end to end spend management overviews, meaning what is the result of another supply chain I'm running. The result can be in so much flavors because it end it is an end to end view. It's not just the material production flow. It ends at absolutely the very end of an invoicing and when we come to and remember the other factors we have of being compliant and having the regulations in place. Now, all of the barriers said, I think that problem is now known and we know that you need a solution for this. And this is why, we created also, very thoroughly with, experts and, you know, talking with a lot of customers, how can we help you? We created a playbook. We call it the preparedness of a playbook to rescue, the situation for you and see, you know, how far are you there. Basically, it it exists of five steps. Those five steps are, are about to, give you a guidance on, you know, where can and should, and should this, flow for you go, when we come to the situation of, how can also software and technology help you? Now step one and two is basically talking about how can I, how can I make sure that I know on the one side which components and supply chains might be impacted? I think this is why we're also, Tobias just touched on in a, you know, in in in a two minutes or three minutes overview where are the tariffs kicking in, what materials flow, so what falls under cars and parts just to stay in the automotive, area. But also in the agriculture, whatever production or food produce food production companies we have for food consumer industries. So you you need to understand, obviously, at the very beginning, where is my supply chain at risk? And not just in this one time event, but you should all of this have always in a regular way, under, monitoring. The second and very obvious is, the rules of origin and the value addition. Right? So often, we accept long term relations, to certain supply chains and not really ask every time, is this origin of that material still in place and the right way to do? And do and do I have and am I prepared for an agile shift in case of a need? So that's the two things which for me also is much more into the department of the different be it productioncom production business, experts, be it, the designers of products, be it, the way of how, for example, also financial, situations need to be managed. So it is a little bit, if you like, the business side, of, of the of the company, if you exclude the moment, the sourcing, spend, and, the area of basically managing supply chains. Now if we go and then deep dive into the, third area, and we can, for the third, maybe progress the slides, we can go to the area of we need to ask ourselves how do really the supply materials look like. Meaning, from which region do I have a model that is showing me from which region, which materials it's from, what are the transportation ways, and what are the tariffs on this, and all of this also digitally made sure that they are kept rightly. And, again, maybe even in a weekly update mode if I'm listening here on, you know, how how often, we have even the change. But today, maybe maybe today, it's a guy it's another update today. So, and then having those models always maintained. Now now all of that said, thing is how can this pass this passing of the tariff cost increases to the consumers? How do I demand and model and based on the demand model then? This is if you the is this is what we call the supply chain modeler, approach, which we have tool, obviously, where you can model exactly those flows in a digital way and basically represent your complete supply chain. So step number three is basically homework. So one, two, finding out the details, business, production, designers, supply chain experts, transport transport environments. Three s representing it, in your supply chain modeler that you see the status quo of today. Now number four, is in the again, all of this you find in the playbook much more, with much more words. Number four is the digitally, scenarios to understand the impact of in supply chain. So meaning, on the four, now you see that it's not just an optimization with, with the, tariffs, obviously, because you have so much so so much different things to consider in your environment. So if you see, for example, increasing holding costs in a inventory, just pick one in the middle on the right side. The second, regulation in compliance or business continuity in in different regions where you are maybe because of this, you know, of an agreement with the government staying there or supplying from there because you have certain tax implications if you leave it. So there are a ton of parameters. And by the way, this is also what what many CPOs tell me when I'm talking to them. People just think that I need just to adapt the tariffs, and then I have solved my problem. No. It's not. You have a dimension of many, many, many accurate, pre prerequisites coming in and assumption you need to do to then decide your new supply chain. So back to this back to the balance you need to see, obviously, all of this ends up, into a mathematical optimization. This the it's it's all about this at the end because one day and you know this saying, the the the numbers are speaking, and everything we we talk here, might be not that relevant for the decision, then, yes, you need to put those, constraints into numbers, and you need to have an environment which mathematically can then, based on what your outcome needs to be, calculate this for you. And this is also the next step in our supply chain and design modeler, which you will get the results of. And then number five, obviously, collaborating and with the procurement and finance department. What exactly are we going to do, and what are the impacts on when we present the recommendations of the mathematic model and then do a decision together with our environment collaborative? Now to go there, imagine today, many companies need need to switch five sorry, three and four, because they don't have the environment for this. And and Tobias, maybe later, you you have you have also some, I I I assume many of, those discussions you have, skipping four and three, and not having the tool set and the agility for it is basically number five, you can't skip because you need to do recommendation. Right? How how can you skip number five? You need to go to your board and say, Hey, we need to react now. That's my three suggestions. Now, if I would then be the CEO, I would say, Okay, and on what are those suggestion based on? And basically, the the most of the answers today is, oh, well, my experience and a a big team which calculated in Excel and in wherever, not bad. I'm not saying that this is bad, but this is the situation. Right? And and many are successful with this too. But the agility and the day night works, maybe in a in a week of of, getting this calculated is what we can avoid. But this agility on using, you know, agile tools with modeler tools and mathematic optimization environments. So yeah. And, basically, what the number five brings to then to a decision, and just to close with a little motivation, but also, motivational, view and also in classic example in our industry. So we have an, a really big customer in US, which I'm very, very, very happy that with us he's, optimizing exactly the supply chains. We just had recently a discussion, with them. They use supply chain, the our supply chain planner and designer for exactly doing and reacting to those tariffs. Just recently, on the 25% tariffs increase cross border US and Canada, what they did is with the solution, again, they have all of the homework done. They calculated, brought up optimization, and with this reduced the total landing costs on the difference of thousand scenarios you can imagine to the three recommended, new supply chain, you know, cross border transportation needs to optimize at the end of the day, obviously, the price of the product. Well, this is obviously only the start because then the demand and everything else comes on, you know, what is then the final price? Do we give it to the consumer? Do we take it on the margin? I mean, all of these decisions, obviously, is another company area than to do it, but you need to start those decisions, obviously, the cost of your product, of your production for the product. So with that, I'm I'm I'm both super happy that, you know, the feedback, went to us on, hey. Thank you for helping me technology wise to be super quick in this and to have all recommendation whenever we need it. Yeah. And, you know, this story makes me also a little little proud that we can help with Cooper, in this very, very, yeah, I would say interesting situation politically where we are in. And, yeah, giving back to Christine then. Thank you so much, Salva. To both of you actually, Tobias and Salva, that was very insightful. I must say my my head is is throbbing with all the ideas and with all the information and and all the possibilities that there are out there because even though it is a scary situation, it's also an extremely exciting one. I have to admit, you know, in our lifetime, what we have been going through and now this, well, it opens up a lot of possibilities. So great. Thank you very much, both of you. I'm going to ask both of you a couple of questions quickly before I open it up for the q and a, and we've already received, some interesting questions from there. So Tobias, if I can ask you first, we are seeing the rising protectionism and shifting global alliances as a result of all the news that we've had since January, right? How do you think companies should include geopolitical signals when they assess their long term sourcing and supply chain decisions? Well, thanks, Christine. And Salvo, thank you to you. I learned a lot. I didn't even know I could learn that much in fifteen minutes. This is a first for me too. I feel like in general terms, I think that companies have to acknowledge the fact that geopolitical decisions are sort of becoming a, becoming a more important part in their everyday decisions. And I think Salvador also alluded to this, with the idea of proactive thinking and actually Cooper's playbook to the rescue, if you want to, which is, the way I understand it, is meant to help companies along and prepare for situations that you might not be able to see coming in detail. And I think this this, like, this holds true as a general, rule. I do feel that, the companies that I talk to or that I that I work with are acknowledging this as we speak. Some of them choose to take a more explicit political stance even, which they didn't used to do, and some of them decide on a different path. And that is basically work try and work around the government level of international relations, and the implications and issues that come along with it. That that's something that I see quite a bit. So so what you see is and this starts on a, like, a federal state level, for example. So you see individual states in The United States like Texas, Louisiana, or others reaching out to, I don't know, you know, the state of Baden Wurttemberg or or or Hesse or Nordenst Pfal in Germany, for example. That's one level that we see. And the other one is companies trying to reach out to each other directly, and establishing trust relations and basically working on their supply chain reliabilities along the lines that Salva outlined. So so go back to your supply chain, check what's still worth. Is there any extra or added value someplace else? And if there is, try and establish that that extra value before this the political overall situation starts to change again. So that's something that that that I see. And then and then just very quickly, I think companies, you know, Christine, very basic terms need to look at the the new tariff policies that they're coming out this week, and you get a it's it's it's sweeping, you know, and it's, basically, nations are being classified into different categories. They're they're the lucky ones with the 10% baseline tariffs, you know, like The UK or Brazil or Australia. And there are the other ones, including the European Union, that are that are sort of subsidized under, under worst offender. Yeah. You know? So Yeah. So I think I think, you know, without evaluating this as such, I think companies need to be need to be aware in very broad terms in which part of the world they are based from the point of view of the US administration. That is not to say it's it has to be, like, their, their perception themselves, you know, but it's it's something that will affect the way they're being perceived from a US point of view, very much so. Yeah. And, you know, we all we we're talking hard facts all the time and I was gonna ask you about, you know, what your view is on what if we're moving away from globalization. But but the other aspect of this is, of course, a social implication, right, that, we are alienating people once again. And, you know, I was thinking the other day, if we think back to COVID, it was something that brought us all together globally. We were all watching the television every night and wanting to hear, you know, when things were improving in other countries. And yet this is probably going to cause us all to move away from each other, which is, which is a sad implication. Yeah. And also with the for the hard facts. I mean, fair enough, Christine. You know, just some hard numbers maybe for the facts. Like, in that worst offender group, you know, I looked it up this morning. So you find China in there, which is no which is no surprise, really. It's gonna be 54% of tariffs calculated, I would I would argue, in a very debatable manner, but that's something else that we can discuss. But then in that same group, we got Vietnam, for example, 46. Cambodia, 40 nine percent of announced tariffs. So you got a number of companies that moved out of China only recently to protect their business and business relations with with The United States. And now, you know, they're gonna be hit by these tariffs out of Vietnam or Cambodia. So this is some very hard facts on the ground separate from, you know, the alienation point that you make. Absolutely. Yeah. It's really sad. Good, Solvak. If I can ask you a question. So referring back to your very interesting five step playbook, which I which I really loved, you spoke about the optimization of scenarios. Could you elaborate on what you see the role of AI is and how AI can accelerate transformation in this way in companies? Yeah. Yeah. Maybe maybe be yeah. Absolutely. I can. Before I start though, I just need to react again to something Tobias just said, and as I have you now here on stage, Tobias. It's just, it's it's so amazing your example of the, move. So companies moved out from China to, and this let's see this now from a supplier part to make it easier to buy from them. Okay? Because they derisks they derisk with it. Right. So, yes, this usually happens also in alignment with their buyers. Right? They the buyers say, like, hey. Look. If you move out from China, we can derisk the situation. Okay? Then they model this somehow in let's assume they don't have this technology and not not perpetuate, and they feel safe. They sleep well. All wonderful. And then boom. Overnight, you have a list of tariffs again because, obviously, the point is, here, how do we react now? Imagine this is a long time work to move a company to another place to then serve you from there. And this is why, again, to the playbook, don't just rely that you have one and two under control and know where it is from and you feel well. You need to have the, three and four, meaning the flexibility to recalculate this in a in a in a manner of days and not of weeks or months to not lose the business and to not lose also your market. I I just you know, it's just a wonderful example you just made to this, you know, without any prep here, but, from from from how really the situation is today and how maybe one some who listens, but also all others which are reading now the new tariff, environment. I just wanted to to react to this. But now to the AI part, AI is is obviously a little of, in all of this, maybe it might become a side a side, a side aspect, because they get me away with all of this stuff. I need now to get my supply chain under control, but, it's not the task of business and CPOs supply chain. It's the it's a task of SaaS vendors like we are to make, with AI a valuable offering that makes it even easier when we come to step three and four. So, because I'm I'm I'm I'm really refraining on saying, like, AI will help you. If you if you talk to CPOs, to supply chain planner, they said, like, hey. What is what is AI? What do you mean with this? It's a it's a it's a hype word for them. For me, as vendor of a software, it's not a hype word. For me, it's the basic, like, bread and butter. I if I don't take it serious, I'm losing the market. So meaning, it's my task to do, and to make sure that that, I use it. Now what is the usage and then the value to customers? Examples. If we talk about an optimization of a new supply chain based on all these parameters you saw on this, balance, so to say, now where do you get all this informations from on where, the the market and the public you offer ex transportation risk is based on. Do you really want to have a research form doing this every day for you in a real in real time? Yes. You do need today. You do because you don't have any other mechanism. So what we are doing is we are now looking exactly on those areas where the manual tech technical manual sorry. Manual task can be brought into technical environments. The technical environments being done by intelligent bots, by screening whatever those manual people have done, reducing hallucinations, making it and matching it to the way on how we can make concrete recommendations. And then going back to the supply chain planner and saying like, hey. This in this country and this in this route has certain risks. I would not recommend to take this. There is an alternative route. And all of this modeling in into our Cooper supply chain by just collecting more and more information. I just made one example, Christine, on where AI if I implement AI, again, for CPO, for the supply chain plan, it's a result of quicker information than asking thousand supply, research firms for their getting the data. I'm basically delivering this out of technology, and that's a little bit how to frame that. Yeah. Yeah. Absolutely. And if I if I can just add sorry, Tobias. You want to choose? Yeah. Just very quickly because I very much like the idea of the Cooper playbook. Christine, you asked about maybe potential social implications from all the turbulence that's coming up. I think this actually helps the customer at the very end of the chain because in the end, it's people, right, who need to to to ensure that their their daily living costs are are still okay. And the share of consumption that low income households pay for tariffs, you know, speaking from experience, is much, much higher than it is for middle income or higher wealthier customers. So so so so what what Salva, I think, is saying or what Cooper is projecting is very helpful in the end even for people who don't get to see the technique and the AI in the first place because they work for these companies. Right? So if you look at the the the average American household, I think it's gonna be there's calculations of an extra 2 and a half thousand dollars of additional tax that they will end up with. So that's a chunk out of their regular consumption possibilities. Right? So so they will be grateful for their companies, and company leaders to follow the sort of playbook that Salvat just introduced, I think, because it would help them in the end to not be hit that hard by it. And that that that's not just the American market. Just wanted to work this out. And and that's exactly what I wanted to say with the AI in our supply chain solution can also help because we can run multiple scenarios to go and understand what the impact of the tariffs are. But people typically tend to think of the impact of tariffs only on the on the sourcing costs. Right? But we can mark the entire end to end cost all the way through to what the final price to the consumer will be. And we can integrate alternative scenarios and then with the predictive analytics, we can come up with recommendations for companies to say, how are you going to counteract that and what influence is it really going to have? Because, yes, we're talking about a potential recession in The US, who who ever thought? Good. We're running out of time, so I'm afraid I'd really have to jump to a question that we got from our audience, and that question is, and I'm going to ask either of you to answer that. How are reciprocal tariffs going to play out, and how do firms prepare for such a trade war that is coming? You wanna look for Saba? No. No. No. No. Go first. I mean, I just I I think I just touched on some potential implications for regular US customers and then potentially around the globe. You know, if you were to, say, buy a car or something, I talked to an acquaintance of mine in Racine, Wisconsin yesterday whom whom I met in the fall when when I was in Wisconsin for the last time. He and he's a tar he's a car dealer. And he says the price of a car of $30,000 might go up to $37,000 as a consequence of this. And he he he didn't he didn't even judge it. He just said that, like, his customers are middle class, basically. Yeah. And they can't afford that that kind of a price bump. So that's that's on the, like, individual level. But but I think on the overall economy, reciprocal tariffs, which I think is a is a very good question. So so nine out of 10 economists will will say that, you know, the whole idea of a trade war is, and a tariff war basically is a bad idea, because it will spiral out of control, more or less. And we can see the European Union preparing countermeasures. Ursula von der Leyen announced just that this morning. Mhmm. But but I think it's interesting to see that, including in The United States, you know, people like from the business roundtable, for example, and that's that's a powerful group, I think, of over 200 American CEOs. And that includes Apple's Tim Cook. That includes General Motors, Mary Barra, you know, and and and JPMorgan and so on. They are saying that that this could this could backfire on The US economy, for one thing. And the Trump administration seems to acknowledge as much, when you look at what the Treasury Secretary Scott Besson said, for example. He he he compared the new tariff policy to a shrinking ice cube, saying, you know, you got an ice cube in the beginning. It feels cold. People will be shocked. Other nations will react because of the cold, but the ice cube eventually will shrink and melt away. So part of the plan could be to not keep this up for too long, which would be technically possible because Trump initiated these these tariff measures through an executive order. So, basically, by by signing it. So it can be unsigned too. It can also be unsigned by his predecessor by his excuse me, by his successor. That so that's that's different options. But, reciprocal tariffs, this is going too far now, but but we could go into the detail of how these tariffs were calculated. And I think we can make a pretty good argument that the calculation does not really work out because non tariff barriers, for example, were not really taken into calculation. There's all sorts of, of these factors as well from what we can see. So the mathematics seem a little shaky. Mhmm. So I'm so I'm not sure the whole idea of reciprocity, works out on that basis. Mhmm. I hear you. Just a warning that, you know, as we saw, mister Trump wants to be his own successor. So there's still an interesting future ahead. No. But I mean, VAT rates, for example, were not really considered. Not very serious. There's all sorts of subsidies, quotas, even technical barriers and so on that have not been taken into account from all I can see. So so they basically they it's very simple. For every country, they just took The US goods trade deficit, if you want, with that country and divided it by the country's goods exports, basically. And then and then sort of and then you get a number. Yeah. And for Indonesia or something, that's somewhere in the higher sixties or so. You know? Yeah. Yeah. Well, look, I mean, I wish we could carry on for two hours because there's so much to talk about. I'm afraid we're starting to run out of time, and we've got to wrap up quickly. So first of all, I just want to share, with everybody that, we are hosting a couple of world tours, our Inspire world tours over the next couple of months, and in Europe as well as in the rest of the world. Please see the dates on here, and please utilize the QR code on the screen to register. We would love to see you at those events. We are very excited about them and what we're gonna share with our customers there a lot more about what we've spoken about, today. Then I really want to thank, the audience and the speakers today. I want to thank you, Solva. Thank you, Tobias, for all the valuable insights you've given us for this exciting discussion we've just had. It was certainly fascinating, as I say. I wish we could carry on forever. Right. And in the audience, thank you so very much for joining us. If we didn't get around to your question, then I'm really sorry. But as we promised, we will be sending out the recording, the slides, and we will be answering the individual q and a also on email. A reminder to also use our coopar.com focused, page focused on traders and adaptive supply chain. Thank you very much, and we hope to see you again. Have a wonderful day.