Resilience and readiness in an era of demand shock

The most resilient companies are those that anticipate disruption and prepare, writes Damien Heary, founder of FutaVista Consultancy.

In recent days, businesses have been fixated on the potential fallout of what Donald Trump called “Liberation Day”, a moment when his threats of tariffs and trade wars seemed poised to upend the system Europe had long relied on.

Yet this is merely the latest reminder of an increasingly volatile global trade landscape, marked by relentless demand shocks. Further, it highlights how easily concerns can shift – from autos and alcohol, to extreme weather and supply chain chaos – triggering knee-jerk responses that often distract from the larger issue at hand – finding meaningful, long-term solutions.

VUCA – volatility, uncertainty, complexity, and ambiguity – is the defining characteristic of today’s business environment. This is an era marked by the Ukraine-Russia war, the Covid-19 pandemic, the closure of the Suez Canal, and even Ireland’s own extreme weather events. Uncertainty is undeniable, and the need for resilience and readiness has never been clearer.

But as history shows, the most resilient companies are not those that simply endure demand shocks, but are the ones that anticipate disruption, strategically prepare, and position themselves ahead of it.

Dealing with demand shocks

Amazon survived the dot-com crash by expanding beyond books into its – now massive – e-commerce platform; Scotch whisky producers weathered the US Prohibition by leveraging their access to a the near-American market of Canada, and even facilitating smuggling routes into the US; McDonald’s brought in a range of salads and healthier options, catalysed by the shift towards health-focused eating.

Demand shocks are sudden, often unpredictable disruptions that affect a company’s ability to operate in its most basic form – hindering the sale of goods and services to export markets. While some shocks present threats, others may offer opportunities for those prepared to seize them.

Demand shocks generally fall into three categories:

1. Tax, Tariff, Regulation & Prohibition – Only three things in life are certain – death, taxes, and TRP (tariffs, regulation, and prohibition). In 2025, these words dominate discussions across industries, from pharma and food & beverage to Big Tech, AI, and crypto. We are no strangers to these legal and direct disruptions, whether through protectionist trade measures, regulatory shifts, or outright bans.
2. Black Swan Events – There is a clear distinction between events that, while uncomfortable, are foreseeable and those that are entirely unpredictable; ’Black swan’ events are natural or accidental disruptions that abruptly alter trade patterns. These shocks come in many forms – Hurricane Katrina, Holyhead Closure, COVID-19. We have seen an increase in such events as climate change continues to have global effects. 
3. Popular Sentiment Swings – These shifts in consumer preferences are often fueled by nationalism, geopolitical tensions, or broader cultural trends. Consider the backlash against Russian products in response to the invasion of Ukraine, ‘Freedom Fries’ or recent cases of Canadians bars de-stocking American Whiskey. 

Regardless of the ‘how’ these Demand shocks can have both immediate and long term impact on revenue, profit and market share. They should be prepared for.

Three strategies for future readiness

Embedding readiness & resilience – In an age of uncertainty, the assumption of stability is costly. A solution to such is scenario planning, exploring plausible disruptions and ensuring organisations are prepared to adapt. Companies that integrate structured foresight into their strategic planning will not only withstand shocks but position themselves to thrive in any future. Financial preparedness is equally critical. The establishment of financial ‘war chests’ allows businesses to weather economic downturns – those with strong reserves can navigate turbulence with agility, with the potential to, instead of retreating, leverage disruptions as a catalyst for innovation. Operational flexibility is another pillar of resilience; businesses must develop the capacity to scale production up or down in response to demand fluctuations. This requires adaptable supply chains, robust logistics and an openness to restructuring when necessary. Furthermore, diversification across brand and product portfolios – spanning different price points, market positions, and offerings – allows businesses to pivot strategically, focusing on those best suited to a changing environment to stay competitive and sustain growth.

Market diversification – Relying too heavily on a single market is a vulnerability no business can afford, and true diversification isn’t just about expanding geographically – it’s about strategic flexibility. Companies must ensure they have touch points across different regions, not only to mitigate localised disruptions but to create agile entry points that can be scaled up or down as conditions change. Rather than overcommitting to every new market, businesses should maintain ‘pokers in the fire’ – light-touch presences in key regions that can be ramped up quickly when opportunities arise, or other markets are closed off. Understanding the unique dynamics of regions helps companies make informed decisions about where to invest, expand, or pivot when disruptions arise. At the same time, companies must never neglect their domestic base. A strong home market acts as a stabiliser during times of international turbulence, ensuring a foundation of reliability at the trickiest of times. 

Local footprints to navigate trade barriers – To mitigate tariffs and trade restrictions, building strong local distribution partnerships is key – collaborating with established local players ensures market access during policy shifts. Investing in local warehousing and supply chain networks is equally crucial; post-Brexit, companies with in-market warehouses fared better than those scrambling for solutions. Diversifying manufacturing across multiple countries also helps, as businesses relying on a single production location risk vulnerability. 

Collective effort and advocacy – a wider view on the bigger issue

Beyond individual corporate strategies, businesses should look to collaborate in order to shape favorable trade conditions. Trade negotiations are influenced as much by lobbying efforts as by government actions. When striving for greater strength tomorrow, it’s essential not to overlook the strength in unity and power of the ‘soft.’ Soft power – the ability to influence and build relationships – can be as vital as financial and operational resilience.

We have grown too familiar with shocks to remain complacent – steadfast in our belief that the ordinary will prevail. This is not only stagnancy but a step backward. As the geopolitical climate continues to shift, and when we never know what exactly next week will bring, the businesses that survive and thrive will be those that take proactive steps today to prepare for the demand shocks of tomorrow.

Resilience is both a strategic approach and a mindset; rather than reacting to each individual crisis, businesses must invest leadership time and energy to building future preparedness. In an era of demand shocks it is not just about response and reactivity and  it is about building readiness and resilience – in effect Future Priming our businesses to thrive in any future.

Main image at top: Photo by Timelab on Unsplash

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