Rajeev Gangwar
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Logistics Network

$5M Tariff Mitigation Strategy

Redesigned the global repair network to mitigate 25% penalty tariffs on China-origin parts.

Network DesignDuty ModelingCost Optimization
The Challenge

When 25% penalty tariffs were imposed on China-origin parts, the existing repair network routing sent parts through China-based facilities, exposing the business to millions in unexpected duty costs. The network needed rapid redesign without disrupting service levels.

The Approach
1

Developed import duty models to estimate total duty exposure across the network.

2

Analyzed alternative routing through non-China facilities, balancing duty savings against logistics costs and cycle time impacts.

3

Proposed network modifications that maintained service commitments while avoiding tariff-exposed routes.

The Outcome
$5M+
in duty savings achieved

$5M+ in duty savings achieved. The project was recognized with an AGS quarterly team award in 2019. The duty modeling framework continues to be used for ongoing tariff risk assessment.

The Lesson

Trade policy changes create optimization opportunities, not just risks. The companies that respond fastest to tariff shifts turn compliance costs into competitive advantages.

RG
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