Small and medium-sized businesses experienced a complex year in 2025, shaped by uncertainty, rising compliance demands, and rapid digital change driven by AI. For smaller firms with fewer resources, these shifts can feel particularly sharp.
While these pressures are not set to abate in 2026, many businesses will come to them more prepared. Below are 10 supply chain trends that will define the supply-chain landscape in 2026, and what they mean for the businesses navigating them.
1. Post-Brexit trade and tariff uncertainty
Brexit custom processes and shifting international tariffs continue to hit smaller firms hardest. Realignments in the UK-EU border processes, changes to Rules of Origin requirements and instances of regulatory divergence all mean that customs procedures and documentation will require frequent updates to stay compliant and keep production rolling.
Real-time monitoring of tariff schedules, dynamic cost modelling, and rapid contract adjustments will increasingly need to be automated to help businesses respond in a timely manner to market changes.
2. Regional partnerships
To contrast tariff pressures and global volatility, UK SMEs have opted for more near-shoring relationships and will continue to build stronger regional supply networks, particularly across Europe.
3. Increased UK regulatory scrutiny
Large companies are tightening supplier checks, meaning SMEs must now prove ethical labour, traceability and basic climate reporting. For SMEs looking to take part in government tenders, the new UK Procurement Act mandates traceability and transparency across the supply chain.
For small and medium businesses, the challenge of achieving visibility across increasingly complex supplier networks depends on having reliable, auditable data available to support auditing for compliance and overall accountability.
4. Cybersecurity threats
Smaller firms often lack IT teams, which makes them vulnerable. More and more ransomware and phishing attacks take place across the globe, while AI is introducing important new vulnerabilities. SMEs thus will need to tighten their security.
In 2026, basic cyber hygiene such as multi-factor authentication, secure backups and verified freight partners will all be essential for survival.
5. Digital transformation picks up pace
Digital twins, IoT trackers and cloud inventory systems are no longer enterprise-only. Local wholesalers and small manufacturers are now using low-cost platforms to track stock, spot delays earlier and automate paperwork.
Yet their effectiveness depends on integration, organisational take-up and talent. Clear governance, data standards and adoption strategies can help ensure digital investments provide ROI.
6. Resisting AI FOMO (fear of missing out)
For far too many businesses, FOMO has been behind the drive for AI investment in 2025, with little return on investment to show for it. 2026 will be a year of reckoning when organisations regroup and focus on a more pragmatic approach to AI, developing solutions that are industry-native and respond to real needs.
7. Data quality
The success of new AI developments in the supply chain will depend on ensuring that systems are suitably integrated and that AI is drawing on clean, current and connected data. Specifically, SMEs are starting to use AI for demand forecasting, delivery routing and stock optimisation.
Many firms still rely on manual data handling, creating inconsistencies that hinder real-time visibility and accurate reporting. 2026 will be the year small firms clean their data before scaling or integrating AI.
8. Circular supply chain models
Repair, reuse and refurbishment are rapidly growing. A rising number of small electronics companies now earn extra revenue from refurbished product lines and trade-in schemes. Circular practices aren’t just about sustainability; they’re becoming profitable extensions to the core business.
9. Procurement strategies shifting towards flexibility and resilience
Years of shortages, which started during the Covid-19 pandemic, have led SMEs to take a proactive approach to broadening their supply chain.
Tariffs, fluctuating commodity prices, international conflicts, have all pushed SMEs to the brink. UK businesses are choosing to be more flexible and turning to multi-sourcing, shorter contracts, strategic stock and near-shoring of essential components.
Despite this, managing a broader supplier base brings its own complexities with more suppliers to vet, onboard and monitor. It means more contracts to negotiate, more data to analyse and more risks to assess. Procurement teams will need support and automation to manage increasing data volumes.
10. Procurement: from cost to value centre
For many businesses procurement has been synonymous with cost centre. The events of 2025, however, have shown clearly how supply chains are directly linked to revenue growth and resilience. SMEs will be embracing the fact that faster time-to-market, stronger sustainability credentials and better customer experiences all stem from strategic supply-chain design.
Simon Thompson is VP Northern Europe at JAGGAER