Major furniture company closing down, no bankruptcy plans | Official Website of Louis Velazquez, entrepreneur, finance guy and tech innovator

The U.S. furniture retail sector has struggled with economic problems over the last year, with retailers closing stores, manufacturers shutting down production facilities, and companies sometimes filing for bankruptcy.

The furniture business has been dealing with rising labor and product costs caused by inflation, a slowdown in the real estate market that has depressed furniture sales, and increased interest rates on debt, all of which have led to financial distress.

💵💰Don’t miss the move: Subscribe to TheStreet’s free daily newsletter💰💵

That was all before President Trump on April 2 introduced new tariffs on imports that are certain to raise furniture costs and prices even higher.

The furniture sector is bracing for increased tariff costs from overseas suppliers, which amount to a 54% tariff on imports from China and a 25% tariff on furniture suppliers in Canada and Mexico, which go in effect April 9.

Trump also imposed a 10% tariff on all other countries beginning April 5.

Tariffs may have already affected Canadian furniture company Prepac, as the company ceased manufacturing at its Delta, British Columbia, plant and moved all production to its factory in North Carolina, the company’s workers’ union claimed.

Unifor, the union representing the Delta plant’s workers, blamed Trump’s tariffs for the plant’s closing, which will result in 170 union worker layoffs in May after the company winds down maintenance.

“Our union has been warning about lost investment and production since Trump began his economic war on Canada and Canadian workers,” Unifor National President Lana Payne said in a statement regarding the closing. “In this case, Prepac and its equity owners are using tariffs as an excuse to redirect all their production to the US. It’s pure greed.”

Prepac’s CEO Nick Bozikis, however, said the decision to close the Delta plant and move production to North Carolina was a product of many months of consideration and analysis and began long before any tariff risks to Prepac’s business arose, Global News reported.

Progressive Furniture is shutting down its business.

Shutterstock

Progressive Furniture shutting down business

And now, huge North Carolina furniture manufacturer and supplier Progressive Furniture, which provides products to major retailers, has revealed that it will close down its business at the end of the year and lay off all 30 of its employees, Furniture Today reported.

The company has not indicated whether it will file for bankruptcy. It also did not say whether tariffs played a role in its decision to shutter.

More closings:

Progressive, a subsidiary of ready-to-assemble furniture company Sauder Woodworking, blamed the closing of its primary supplier in Mexico, which provided 60% of its products, for its decision to shut down its business. The company imports wooden furniture from both Asia and Mexico.

“This decision was not made lightly, and we understand the impact it will have on our employees, customers and partners,” Dan Kendrick, company president, said. “We are committed to supporting our employees through this transition and will aid where possible to help them find new opportunities.”

Mexico supplier closing impacts business

“Obviously, business conditions have been challenging for the past few years, but the closure of our primary supplier in Mexico has made a major impact,” Kendrick said.

The company, which operates a warehousing and distribution in Claremont, N.C., will fulfill existing orders and honor warranties until it closes, Kendrick said.

Progressive Furniture sells its products through Walmart, Target, Home Depot, Lowe’s, Amazon, Wayfair, and other furniture retailers.