Global businesses brace for supply chain headwinds but optimistic about int’l trade: HSBC study

Global businesses have been hit with surging costs, supply chain disruptions, and are having to rethink their strategy and planned investments as tariffs and shifting trade policies continue to impact their enterprises, according to the findings of HSBC’s 2025 Global Trade Pulse Survey.

The survey, which offers insight into the business plans and sentiment of over 5,700 international firms across 13 markets regarding tariffs and trade, revealed that two thirds of corporations have already experienced cost increases due to tariff and trade uncertainty, and the worst may be yet to come, according to a media release. 

Companies expect costs to escalate further in both the short-term (73 per cent) and the long-term (72 per cent).

Businesses also expect an average decline in revenues of 18 per cent due to supply chain delays. Over half of respondents (51 per cent) feel rising costs are the number one concern for supply chain strategies and 85 per cent of corporates have revised or plan to revise their pricing strategy upwards to reflect higher costs or market changes.

Over three quarters of corporates (78 per cent) are having to rethink their long-term business model.

If tariff instability continues over the next two years, 43 per cent of companies will rethink their international expansion strategy and 39 per cent will shift their focus to domestic or regional markets.

Despite these headwinds, optimism about expanding global trade is strong, the survey disclosed. 

Nearly 9 in 10 businesses (89 per cent) are confident in their ability to grow international trade over the next two years. Businesses are also reconfiguring their supply chains and reassessing how and where they operate.

Most are taking action or planning to carry out nearshoring (moving production closer to key customer markets, 83 per cent) and reshoring (bringing production back to their home country, 77 per cent).

Businesses most likely to initiate nearshoring, a practice gaining most traction by globally exposed and production-centric sectors, are those in Technology, Media and Telecoms (87 per cent have done so or plan to). Businesses most likely to have experienced an increase in costs to date are those in Consumer (70 per cent), followed by Healthcare (69 per cent), and TMT (69 per cent), according to the survey.

Encouragingly, a vast number of respondents see trade pressure as a catalyst for innovation, with 77 per cent saying it has encouraged them to evolve and seek new opportunities.

Many businesses (58 per cent) have already adopted new technologies or platforms, 56 per cent have improved internal efficiency or cost structures, and 51 per cent have developed new products or services.

The survey pointed to the emergence of new trade corridors in some of the markets surveyed, as global businesses are strengthening their relationships with key markets outside their borders.

Malaysia (61 per cent), Vietnam (52 per cent) and Bangladesh (54 per cent) are expanding their relationships with China; Bangladesh (65 per cent) India (54 per cent) and the United States (51 per cent) with Europe, and the United Kingdom (46 per cent), India (62 per cent) and Bangladesh (58 per cent) with the United States.

In some markets, optimism about international trade growth endures, led by India (96 per cent), including Bangladesh (95 per cent) and the United Arab Emirates (94 per cent).

In line with the global positive outlook, larger businesses (those with a revenue over $2 billion) are confident about their ability to grow international trade over the next two years (82 per cent), although less so than the average, (89 per cent). They are also more likely to have adopted new technology or digital platforms in response to trade uncertainty in comparison to smaller businesses (those with a revenue of less than $500m) at 63 per cent vs. 56 per cent.

Larger firms are more cautious than smaller corporates about their decision making and are more likely to have already delayed or paused investments (38 per cent vs.30 per cent).

This is despite larger companies having a much wider access to pools of working capital. Smaller firms, on the other hand, are often more agile and quicker to make decisions despite lacking the capital depth of their larger counterparts, the survey revealed. 

Vivek Ramachandran, Head of Global Trade Solutions at HSBC, said, “The current landscape of tariffs and trade uncertainty presents significant challenges for businesses, but they are showing great resilience and adaptability in the way they operate.”

“With over 70 per cent of companies anticipating sustained cost increases, and businesses facing an average 18 per cent drop in revenue, the imperative for strategic adaptation is clear. Navigating this climate requires not only agility, but strong partnerships to ensure sustained growth in a shifting global economy.”

Bangladesh is also amongst the 13 markets covered by the HSBC Trade Pulse Survey, offering insight on business plans and sentiment on trade and tariffs, targeted at international corporates.

250 responses were collected between April 30 and May 12, 2025, from Bangladesh.

According to the survey, due to the tariffs, Bangladeshi businesses have experienced a lower-than-average cost increase to date and are expecting a notably lower short and long-term cost increase. The mean average expected impact on revenue to a Bangladeshi business due to supply chain delays/interruption is 5 per cent higher than the global average.

Bangladeshi companies have enhanced data analytics, developed risk management plans, run simulations to prepare for different trade outcomes and diversified supply chains.

The companies interviewed are extremely optimistic about their international growth, but half of those surveyed would like strategic advice in navigating international expansion.

In light of current trade dynamics, businesses in Bangladesh are adapting their trade strategy to increase reliance on Europe, the USA and South Asia, the release adds. 

Commenting on the trade survey findings on Bangladesh, Md. Mahbub ur Rahman, Chief Executive Officer, HSBC Bangladesh, said, “The survey findings highlight the adaptability of the Bangladeshi businesses and their optimism to embrace changes. With our global expertise and strong international network, we are ideally positioned to collaborate with our customers and keep connecting them to opportunities here and from around the world”