As the #petindustry enters 2026, global trade conditions are becoming less volatile—but not necessarily easier. Tariff structures are stabilizing, legal challenges are unfolding slowly, and financial pressure continues to weigh more heavily on smaller businesses than on large players.
Based on industry discussions held toward the end of 2025, several clear patterns are emerging. While headlines may continue to shift, these five trade realities are already shaping decision-making for #petbrands, retailers and suppliers—and should be factored into planning for the year ahead.
1. A “New Normal” for Tariffs Is Taking Shape
The period of sudden, shock-level tariffs appears to be fading. Instead, trade policy is settling into a more structured and legally defensible framework built around mechanisms such as Section 301 and Section 232.
Recent actions suggest that tariffs in the 10–20% range are becoming a baseline rather than an exception. While this level still represents a meaningful cost increase for #petimporters, it is notably more predictable than the extreme spikes seen in earlier phases.
The key shift is conceptual: tariffs should now be treated as a permanent cost of market access, not a temporary disruption. Pricing models, sourcing strategies and product development decisions increasingly need to assume that this cost will remain in place.
2. Legal Challenges May Continue—but Refunds Are Not Guaranteed
Ongoing legal proceedings, including potential Supreme Court involvement, could reshape how certain tariffs are applied. However, even if tariffs are ultimately ruled unlawful, refunds are unlikely to be automatic.
Current signals suggest that importers would still need to provide detailed documentation to reclaim any duties paid. That includes precise records of entries, tariff classifications, payment amounts and liquidation timelines.
Rather than rushing into litigation, businesses are better served by focusing on data discipline. Clean, well-organized import records may prove to be the most valuable asset if refund mechanisms eventually become available.
3. Exclusions and Retroactive Adjustments Exist—but Relief Is Uneven
Trade exclusions and retroactive tariff adjustments are not theoretical. In some cases, exemptions tied to trade agreements or retroactive deals have already allowed importers in other sectors to seek refunds.
However, #petproducts have not yet benefited meaningfully from these mechanisms. Most published exclusions continue to focus on essential goods or agricultural categories, with no clear pathway for pet companies to apply for relief.
The implication is straightforward: while monitoring trade deals remains important, #petbusinesses should not assume that future exclusions will automatically apply to their products.
4. “Creative” Workarounds Can Create Bigger Risks
Some companies have explored adjusting Incoterms or shifting the importer of record in an attempt to reduce tariff exposure. While these strategies may appear attractive on paper, they introduce significant compliance and operational risks.
Potential consequences include customs delays, misdeclared values, regulatory penalties and loss of control over supply-chain compliance. In many cases, these risks outweigh any short-term savings.
Structural changes of this kind should only be considered with experienced partners, strong contractual frameworks and legal guidance—and never as a shortcut to bypass tariffs.
5. Falling Rates Offer Limited Relief for Small Pet Businesses
Recent interest rate cuts may slightly reduce borrowing costs, but they do not eliminate the underlying pressure created by tariffs and rising input costs.
Smaller pet businesses continue to feel margin compression more acutely than larger players, even as headline consumer spending remains resilient. Any financial relief is best used strategically—supporting inventory planning, automation or selective near-shoring investments—rather than assuming a return to pre-tariff conditions.
What This Means for Pet Businesses
Across all five themes, a consistent message emerges: tariffs are no longer a short-term disruption—they are part of the operating environment.
The businesses best positioned for 2026 are those that stay informed, document everything carefully and make decisions based on long-term resilience rather than short-term reactions. Planning for predictability, even at higher cost levels, is becoming a competitive advantage in itself.
Source: APPA