The Impact of Tariffs on SaaS and Hardware Sales Performance
What are tariffs?
Tariffs are duties or fees set by governing bodies on imported goods. Tariffs seek to regulate trade and encourage domestic manufacturing, but the results of tariffs can be unpredictable at times.
Tariffs affect manufacturing costs, supply chains, pricing strategies, and overall market dynamics – sometimes on a global scale.
Challenges that can arise with tariffs
In addition to market unpredictability due to the possibility of retaliatory tariffs and unexpected fallout from supply chain issues, it’s essential to stay updated about current tariffs in order to weather changes in the market.
Tariffs can affect the financial outlook of SaaS and hardware vendors and buyers alike, so it’s important to be ready to offer commercial flexibility, and be able to adapt to sudden changes. Using a B2B contract financing or BNPL (buy-now-pay-later) partner to offer flexible payment terms can be a wise way to respond to tariffs in all their forms and make buying easier for your customers.
How tariffs impact the cost of hardware
For SaaS companies that sell hardware components, tariffs can impact this key element.
Tariffs generally make the cost of hardware rise – specifically hardware manufactured outside of your organization’s home country. This can make it difficult for SaaS vendors and buyers to make hardware purchases.
On the other end of the spectrum, hardware supply can decrease as demand skyrockets with vendors stockpiling hardware elements in hopes of avoiding higher tariffs in the future. Additionally, an increase in demand can impact turnaround and shipping times, causing disruptions in distribution.
Ultimately, hardware pricing can become volatile and unpredictable, leading to impacts on software pricing.
How hardware price increases impact software sales
Although most SaaS is exclusively delivered digitally, and therefore not directly subject to tariffs, the industry is not immune to the macroeconomic environment. Increased hardware costs can lead to higher prices for devices that run the software, potentially reducing demand. Additionally, semiconductors and other elements that form the infrastructure of software development and AI advancements can be impacted by tariffs.
If your software product involves hardware elements, your SaaS subscription prices must rise in order to keep up with the rising cost of hardware.
If your SaaS platform does not include a hardware element, consider that your customers may be paying more for hardware that’s unrelated to their SaaS expenditures – therefore tightening their budgets and necessitating cost-cutting measures.
In both cases, many customers will be feeling new financial strain, and bracing for the uncertain future by guarding their liquid assets closely. SaaS purchasing mindsets and behavior often change in response to tariffs, which requires an adjustment of sales tactics.
Tariff readiness
Whether responding to customer financial constraints or responding to the rising cost of hardware, it’s essential for SaaS vendors to be prepared to respond to the unpredictable environment that can result from the institution of tariffs.
Responding to tariffs as a SaaS vendor can include:
- Offering flexible payment terms
- Ensuring you have capital to invest in product and GTM now
- Increasing product value
Responding to tariffs with flexible payment terms and contract financing
Matt Green, CRO of Sales Assembly said it best: “Flexibility wins. Rigidity kills. If your pricing model is a concrete block, good luck.”
In today’s market environment, customers seek human-led experiences that make them feel heard and valued. SaaS sales in 2025 isn’t a process of quoting and signing deals – it’s a partnership, and a key element of that partnership is giving your customers choice and flexibility.
Flexible payment terms allow customers to choose the payment schedule that works for their needs, whether they’re tight on cash, struggling to keep up with the rising cost of hardware, or simply want to remain liquid in the present.
Offering flexible payment terms while still getting paid the total contract upfront through contract financing allows both parties to control their cash flow and boost liquidity. Contract financing through a B2B payment solution provides the payment options in a streamlined, easy-to-use, and digital purchase experience.
Offering flexible payment terms with Capchase
Capchase was built as a win-win platform for SaaS vendors and customers alike.
How flexible payment terms can help SaaS vendors respond to tariffs
Capchase empowers SaaS sellers to close deals faster and without relying on heavy discounts. In a tariff environment, Capchase can help push deals through by offering a custom payment experience that meets customers where they’re at.
Capchase also allows vendors to cover higher hardware costs in a way that customers can manage – if pricing has to increase, customers can spread out the payments making the increase more digestible.
While Capchase manages customer billing and collections so finance teams can focus on cost and price optimization instead of chasing payments, SaaS vendors collect full contract value upfront in order to power growth, pre-order more hardware inventory, and invest in GTM efforts.
How B2B BNPL can help SaaS buyers afford price increases due to tariffs
Capchase makes it possible to pay for SaaS platforms even with the price increases caused by tariffs. For platforms that include hardware elements, the price increase can be significant, and spreading out the payments through Capchase makes it easier to pay for a subscription without a big cash outlay all at once.
Additionally, Capchase integrates seamlessly into the vendor checkout flow, allowing customers to conveniently select their own payment schedule. This avoids back-and-forth price negotiations, or if you’ve tried contract or hardware financing with a traditional finance partner, this avoids the manual data entry, email and phone call delays, and lack of status visibility they provide. Most importantly, Capchase finances both software and hardware, as opposed to legacy financing options, which typically require a separate application, insurance, and payment schedule for hardware and software elements.
Additional ways leveraging Capchase Pay can help
Access to total revenue to shift inventory strategy
Tariffs and geopolitical tensions can make single-region supply chains highly risky. With Capchase, vendors can leverage contract financing to get paid full contract value upfront, allowing them to invest in local manufacturing where feasible.
Improve customer retention
It’s harder to acquire new customers during uncertain times than to retain current customers. In this time, it’s essential for SaaS vendors to continue to prove product value, maintain excellent customer service, and ensure customers see a strong return on their investment.
On top of that, flexible payment terms have been shown to improve client relationships, increase renewal rates, and lower churn, allowing vendors to retain more of their current customer base.
How our customers use contract financing to respond to a challenging market environment
Genusys, a provider of high-quality telecommunication services, including Voice over Internet Protocol (VoIP) software, is gaining a competitive advantage in their market thanks to leveraging Capchase Pay.
Contract financing has been a powerful growth tool for Genusys because it allows them to offer flexible payment terms on software and hardware sales alike while immediately collecting the full TCV to invest into GTM and other growth initiatives. Soon after implementing Capchase Pay, Genusys went from closing around 10 new accounts per month to over 50–a 5x growth! Read more about their experience
RobCo designs, develops, and deploys smart modular AI-based robot solutions tailored to a company’s needs. Robots for machine loading and unloading and materials handling across manufacturing, food and beverage, logistics, automotives, among other industries. They are leveraging Capchase Pay to collect the TCV upfront on their multi-year deals so they can continue investing in building more robots which is a heavy capital expenditure product, as you can imagine.
Netradyne is a technology company specializing in advanced fleet safety and management solutions. They provide software and hardware that leverages AI, machine learning (ML), and edge computing to enhance driver performance and road safety. Netradyne started using Capchase Pay to provide payment terms to their customers who prefer to pay a multi-year contract over time, monthly or quarterly, instead of upfront. Netradyne did not want to become a bank, managing money movement at different times across their vast 3,000+ customer base, so instead they turned to Capchase, a proven software and hardware financing partner.
Invest in the tools you need now to meet the challenges of tariffs. Ready to explore?
PS: it costs you nothing to try it out
