Avalara Report: Tariff Uncertainty Has Pushed 39% of Companies to Delay New Markets, 14% Have Abandoned Expansion

Author: Sedat Onat

Avalara Craig Reed John Burhans Mercury tariff uncertainty global expansion cross-border trade compliance cost supply chain trade fragmentation

Container port and customs operations imagery, illustrating companies pausing global expansion due to tariff uncertainty

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Tariffs and changing trade rules are reshaping how companies approach global growth — and in some cases, whether they expand at all. A new report from Avalara finds 83% of businesses say cross-border operations are more complex than they were 12 months ago.

Craig Reed, GM of Cross-Border at Avalara, said: "Global expansion hasn't lost its appeal, but the rules of the game are changing faster than ever. As trade becomes more fragmented and unpredictable, businesses are realising they can't wait for certainty to return." According to the report, 39% of companies have delayed entering new markets due to regulatory uncertainty, while 14% say they have abandoned expansion plans altogether.

Tariffs and trade rules are not just increasing; they are changing faster than companies can plan for. John Burhans, Chief Trade Officer at Mercury, said: "Today, these episodic shocks have become volatile and continuous." Companies can no longer hold assumptions for more than 12 months, forcing teams to constantly adjust sourcing, pricing and supply chain strategy. The cost of staying compliant is climbing — businesses now spend close to 10% of cross-border revenue on compliance, customs, tax and regulatory requirements.

Tariffs and duties remain the biggest source of friction, with 52% of respondents pointing to them as the top operational burden. Despite the challenges, companies are not pulling back from global trade entirely — they are becoming more selective, weighing upside against the risk of sudden policy changes. Burhans added: "Flexibility and understanding of production inputs and a business's holistic supply chain has become an imperative road map for both impact and strategic adjustments."

Key Takeaways:
1. Avalara: 83% of businesses find cross-border operations more complex than 12 months ago.
2. 39% have delayed entering new markets; 14% have abandoned expansion entirely.
3. Roughly 10% of cross-border revenue is spent on compliance, customs, tax and regulation.
4. Tariffs and duties are the top operational burden for 52% of respondents.
5. Mercury's Burhans: holding assumptions beyond 12 months has become unrealistic.