PSA Furniture Import Tariffs Rises up to 295% (from China & Vietnam)
"Thinking of buying a new couch? The price may have just quadrupled"
Furniture industry thrown into chaos as tariffs cause retail prices to spike
https://www.cbc.ca/news/business/furnit ... -1.6043863
It's probably much too late to rush into smaller stores as they've likely already increased their prices on Made-in-China furniture. However, very large distributors (like Costco and Walmart) likely price goods at the cost that they were purchased at previously (rather than future replacement cost prices).On May 5, the federal government imposed tariffs of up to 295 per cent on imported upholstered furniture from Vietnam and China.
He recalls a customer who came into one of his stores recently and tested out a recliner that was priced at $698. "If they come to my store today, it's going to be $2,598," he said. "It's not affordable."
Ottawa imposed tariffs after a half dozen Canadian furniture producers complained that products from Vietnam and China were being dumped into Canada at prices that were wildly uncompetitive.
According to Palliser, the flood of cheap products, primarily from China, is hurting Canadian companies. "There has been a significant loss of jobs across Canada as a result of the unfair competition from China in particular," one of the company's submissions to the Canada Border Services Agency says.
Exporting items at prices below what they would sell for domestically is known as dumping, and it's a contentious issue in international trade law.
Unpopular though they may be with consumers, tariffs are one of the bluntest instruments available to governments seeking to level the playing field.
Complaints about unfairly priced Chinese and Vietnamese-made products have been a long simmering issue in the furniture business, so while Dodd says he had an inkling something was coming, he was expecting tariffs in the range of 10 to 20 per cent, similar to what the U.S. recently implemented.
But at four times the sticker price for some products, sales have slowed to a crawl as customers balk at exorbitant hikes, he said. While about half his upholstered merchandise is locally sourced, the other half has been waylaid by the tariffs.
"I've cancelled almost 35 containers of product coming until the end of the year," he said. "That's $1 million of sales."
So, if you are price-sensitive and looking for a new furniture item, you might want to rush into Costco or Ikea and buy it now! I can't imagine how this will impact the furniture department of Ikea. Instead of replacing existing upholstered furniture inventories from China, they may just have them made in other countries now.
The vast government trillion-dollar (COVID) financial policies and multi-year 0.25% manipulated interest rate policy, we can definitely count on significantly increased prices and many more country trade disputes. It's going to get very interesting.