What: Nontariff barriers and regulatory risks are forcing retail CEOs to adapt operating models and embrace digital, data-driven services to remain resilient in a shifting global trade environment.

Why it is important: The changes illustrate how regulatory and geopolitical risks are accelerating the transformation of business models, confirming patterns observed in recent industry reports.

In the current global trade environment, CEOs are increasingly confronted with nontariff barriers that extend far beyond traditional tariffs, impacting cross-border services through complex regulations, taxes, and data transfer restrictions. As the value of cross-border services is projected to outpace goods, reaching $11.7 trillion by 2032, companies across all sectors—including retail—are embedding more digital and data-driven services into their offerings to drive innovation and build high-margin revenue streams. However, few organisations have thoroughly assessed their vulnerability to these evolving restrictions or developed robust strategies to mitigate the associated risks. The shift from centralised, single-platform models to fragmented, regionalised solutions is escalating operational costs and complexity. To remain competitive and resilient, CEOs must invest in predictive modelling, risk management, and flexible operating models that anticipate regulatory changes and geopolitical disruptions. This proactive approach is essential for sustaining growth and maintaining a competitive edge in an increasingly volatile trade landscape.

IADS Notes: The evolving landscape of global trade is compelling retail CEOs to rethink their strategies as nontariff barriers and regulatory risks increasingly affect cross-border services. Recent industry analyses underscore the urgency for retailers to adopt data-driven, resilient operating models, as highlighted by McKinsey in April 2025, which emphasised the need for geopolitical nerve centres to navigate $640 billion in additional import costs and declining consumer confidence. In March 2025, Forbes detailed how AI-driven solutions and predictive modelling are now critical for managing cost and supply chain complexity amid shifting trade policies. The surge of Chinese e-commerce platforms in Europe, reported by GDI in August 2025, illustrates how trade disputes and regulatory gaps are accelerating digital disruption and forcing traditional retailers to innovate rapidly. BCG’s June 2025 research further confirms that global businesses must balance regional autonomy with global efficiency, as only a minority have successfully scaled AI and digital capabilities. Finally, the transformation of traditional retailers into data-driven platforms, as described by BCG in June 2025, demonstrates how integrating digital services and new revenue streams is widening the performance gap between industry leaders and laggards.

The global trade shift that could blindside CEOs