A recent survey conducted by Furniture Today between December 2 and 4, 2024, gathered responses from over 200 industry professionals, revealing that the proposed tariffs by president-elect Donald Trump would have a substantial impact on the furniture sector.
Nearly half of the participants (46%) believed that the proposed 25% tariffs on goods from Canada and Mexico, along with a 10% tariff on Chinese products, would have a "very significant" impact on their business. An additional 40% anticipated a "somewhat significant" effect, while only 2% claimed there would be no impact.
Photo: Dreamstime.
The most anticipated consequence of these tariffs would be increased prices for consumers (87%) and within the supply chain (83%). Respondents also noted other potential challenges, including inflation (71%), production shifts to other countries (68%), retaliatory tariffs on U.S. exports (56%), product shortages (44%), and job losses in targeted countries (43%).
Nearly half (45%) of the respondents predicted that U.S. furniture sales would decrease in the upcoming year due to the tariffs. Conversely, 13% thought there would be a temporary boost in sales as consumers sought to avoid higher prices or shortages. A positive outcome for domestic manufacturers, mentioned by 41%, could be a surge in demand for American-made products.
To mitigate the impacts, furniture companies indicated various strategies, such as increasing prices, adjusting international sourcing, boosting domestic production, stockpiling inventory before tariffs take effect, lay-offs, developing long-term strategies, and adopting a wait-and-see approach. Potential alternative sourcing countries mentioned included Vietnam, India, Brazil, and European nations that have low or no tariffs.
Confidence in the tariffs being implemented as planned was mixed among respondents. While two-thirds expressed confidence, nearly 17% thought there might be changes before the new administration took office in January, and 18% were unsure. Most respondents (40%) believed the effects would be immediate, with others predicting impacts within weeks (30%) or months (19%).
The survey also highlighted the reliance on China, Canada, and Mexico within the industry. One-third of respondents noted that over half of their business involved one or more of these countries. Specifically, 57% sourced furniture from China, 34% from Mexico, and 18% from Canada. China was identified as the top sourcing country for 38% of respondents, followed by Mexico (33%) and Canada (27%).
The survey concluded that the upholstery segment would be the most affected, followed by case goods, furniture components, textiles, and mattresses.
Source: www.furnituretoday.com