By Simon Thompson, VP UK and Nordics at JAGGAER
Supply chain visibility across Tiers plays a critical role in providing businesses with solid data to make their compliance, ESG, modern slavery and general provenance claims. It is also critical to protecting their supply chain from unexpected shocks and helping pivot fast, ideally faster than the competition when a disruption does occur. Roughly 95% of companies have good visibility of their Tier 1 suppliers, but little or none beyond that. Ironically, Tier 2, Tier 3 and Tier 4 are where 85% of disruptions tend to originate. When China restricted rare earth exports in April 2025, for example, the source was four tiers deep, in unmapped refiners. That gap is about to be tested again, and this time the trigger isn’t a single export ban but the relaunch of the U.S. tariff system.
Bolstering the tariff wall
The Section 122 global tariff, which imposed a flat 10% levy, expired by statute on July 24, 2026. In its place, the administration is installing replacement duties under Section 301 and Section 232. Unlike the Section 122 tariffs, which had a 150-day expiration date, these legal authorities have no built-in expiration and no statutory rate ceiling. The first move landed as 10% or 12.5% duties on roughly 60 countries tied to alleged weak enforcement of forced-labour bans, but markets see this as likely only an opening step, with additional probes into industrial overcapacity, alleged intellectual property practices, and national-security protections for sectors from semiconductors to robotics still to come.
Aluminium offers a concrete illustration of how granular and fast-moving this has become. On July 20, the White House issued a fact sheet describing a new Section 232 proclamation that lets companies apply for reduced tariff rates in exchange for committing to build, expand, or refurbish U.S. aluminium smelting capacity, with Commerce empowered to claw back the benefit, retroactively, if a company misses its onshoring commitments. That single mechanism changes the tariff exposure of any product with aluminium content, based on a commercial commitment made somewhere upstream that a buyer several tiers removed may never see documented.
The knock-on effect
Traditional procurement systems are typically built around the purchase order boundary. This structure holds up reasonably well at Tier 1, where buyers have contracts, audit rights, and negotiating leverage. It fails completely below that line, where none of those levers exist and Tier 1 suppliers routinely treat their own sub-tier networks as proprietary information they have no obligation to disclose.
A tariff reset dangerously stress-tests that blind spot. A component that looked tariff-neutral a month ago can suddenly find itself inside a new country grouping, a newly opened Section 301 investigation, or a newly announced Section 232 category due to a raw material two or three tiers upstream. The impact will soon reach Tier 1 and therefore the business in the form of increased force majeure declarations, hazardous materials risks and quality incident reports. The harsh reality of this impact was clearly documented after the 2024 tariff reshuffle.
Apparent diversification at Tier 1 often masks concentration further back: a Tier 2 supplier providing raw materials or sub-components to a Tier 1 is frequently the sole qualified source for a critical material. In automotive or aerospace, a single Tier 1 may depend on dozens of such relationships. Over 80% of large European manufacturers, for instance, sit within three supply chain steps of a Chinese rare earth producer.
Standard supplier relationship management platforms were not originally built to answer visibility questions beyond Tier 1. They were built for enrolled, contracted suppliers, so by the time a sub-tier disruption spreads up to a Tier 1 scorecard, the opportunity for timely reaction has already closed. Only a meagre 7% of supply chains execute decisions in real time. In regulated industries, qualifying an alternate source can take 12 to 24 months, which turns policy change into a cost to be absorbed for years.
Achieving continuous, multi-tier visibility
This gap is not going to close by throwing more data at existing systems; it requires an architectural restructure. The risk management perimeter needs to be permanently shifted from the purchase order to the actual production dependency, whether or not a contract exists at that layer. In practice, that means combining a framework that extends governance to every node whose failure could propagate upstream; continuous enrichment from financial distress signals, geopolitical tracking, trade flow analysis, and compliance monitoring; and purpose-built technology that can provide visibility even over a sub-tier relationship a company was never told about.
The tariff reset now underway is not a one-off shock as more country- and sector-specific measures are coming in the months ahead. The aluminium proclamation shows how conditional and fast-changing individual tariff lines can become, highlighting the importance of real-time visibility across Tiers. Organisations that can only see as far as their direct suppliers will keep discovering their exposure and reeling from the impact for months afterwards even though every existing supply chain dashboard is still showing green.
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