How often should the report be refreshed?

Monthly for the standing report, plus out-of-cycle refreshes when a major rate change is announced. A CFO who gets the exposure number before the invoices arrive will fund the monitoring; one who learns about it from the P&L will ask why nobody was watching.

What if we do not have clean SKU data yet?

Build the report top-down first: total duty spend from your broker or carrier invoices as a share of COGS, then improve the SKU-level detail over time. An approximate report this month beats a perfect report next quarter, and the top-down number usually justifies the cleanup work.

Who should own the report?

Whoever owns pricing or margin, typically finance with operations supplying the inputs. The report fails when it lives in a shared drive with no owner; it works when one person is accountable for the number and the decisions behind it.

How to model tariff scenarios for 2027 planning

Short answer: Build three scenarios, not one forecast: current rates held, moderate increases on your key lanes, and a stress case where the worst plausible rates hit your top categories. Run each scenario SKU by SKU against planned 2027 volumes, and hand finance a budget range with named triggers instead of a single duty number that will be wrong by March.

Why one duty number fails

Tariff policy moved repeatedly through 2025 and 2026. A 2027 plan anchored to today's rates is a bet that the next twelve months will be quieter than the last twelve.
Finance cannot budget from a point estimate with no error bars. A range with named assumptions gets approved; a single number gets questioned the first time reality deviates.
Scenario planning is also a decision tool. The point is not predicting rates, it is knowing in advance what you will do when each scenario arrives.

The three scenarios to build

Base case: current rates hold through 2027. This is the plan of record, and it should be the only scenario with full operational detail.
Pressure case: moderate increases on your two or three highest-volume lanes, modeled on the kinds of changes that actually happened in 2026. Compute the margin impact per SKU and the total dollar exposure.
Stress case: the worst plausible rates on your top categories, including stacked duties where they apply. This scenario exists to answer one question: does the business still work?

Running the math SKU by SKU

Start with planned 2027 volumes per SKU, not this year's actuals. The scenarios are only useful against the plan you intend to execute.
Apply each scenario's rates to the SKU's HS code, origin, and destination. The output per SKU is three landed-cost numbers and three margin numbers.
Aggregate to the category and company level. Finance budgets in totals; the SKU detail exists so you can say which products break under which scenario.
Name the triggers. Each scenario should list the policy events that would move you into it: a Section 301 review outcome, a de minimis change, a new product-specific duty.

What finance needs in the report

The range: base-case duty spend, pressure-case spend, and stress-case spend, as dollars and as margin points. That is the whole budget conversation on one slide.
The break points: which SKUs go unprofitable under the pressure case, and which categories break under stress. These are the decisions hiding inside the numbers.
The hedges: what you have already done to narrow the range, like origin diversification, bonded warehousing, or DDP pricing that passes increases through. A scenario model without hedges is just anxiety with a spreadsheet.
The review cadence: when the scenarios get refreshed. Quarterly is the sane default; monthly when policy is moving fast.

Keeping the model current through the year

Assign one owner. A scenario model that belongs to everyone gets updated by no one. The owner refreshes rates quarterly and flags when a trigger event moves you between scenarios.
Track actuals against all three scenarios, not just the base case. When reality drifts toward the pressure case for two quarters running, the plan of record should move with it.
Reuse the model for sourcing decisions. A new supplier quote should be evaluated under all three scenarios, because a supplier that is cheapest today can be the most expensive under the stress case.

Questions buyers ask

How precise do the scenario rates need to be?

Directionally right is enough. The scenarios exist to bound the budget and pre-make decisions, not to predict the Federal Register. Spend the precision on your SKU data, HS codes, origins, and volumes, because those are the inputs you control.

Should we share the stress case with the whole company?

Share the range, not the panic. Finance and ops need the full model; the broader team needs the plan of record and the triggers. A stress case presented without context reads as a forecast, and forecasts become self-fulfilling in the worst way.