In the wake of recent fast-moving political activity, the on-again-off-again-on-again tariffs on Mexico and Canada, successive tariff hikes on China and wide-ranging talk of additional reciprocal tariffs on any number of current U.S. trading partners, it wouldn’t be surprising for furniture industry executives to feel as if some of the traditional ground is shifting under their feet.
It also wouldn’t be surprising for some companies to feel the need to respond quickly and decisively, to get ahead of the competition or to find ways to leverage the current situation to their advantage.
That could be a mistake.
If there was a lesson to be learned from the pandemic period of 2020 to 2023, it is that moving too quickly and strongly to capitalize on a situation, such as the then-spike in consumer demand, can just as quickly become a problem when conditions change. Anyone who spent the succeeding years trying to clear out inventory ordered at the height of the buying boom will remember that lesson, a lesson that put several once-venerable companies out of business.
Certainly, the imposition of significant tariffs on key trading partners is disruptive in the short term. However, for the moment at least, no one knows how long the “short-term” will be, how long those tariffs will be in place or what successive trade agreements may follow in the wake of those tariffs. It’s also unclear how the impact of tariffs coupled with other changes underway may serve to reshape existing trading relationships or the global marketplace in its totality.
That does not mean standing pat and doing nothing. It does mean focusing on the basic blocking and tackling that drives business day-in-and-day-out in good times and bad. Among the lessons of the pandemic was that companies that understood their customers and remained true to their business model and mission were quicker to recover and less prone to major downturns.
That is as true today as it was then.
Another lesson was the importance of maintaining strong relationships even in the face of adverse conditions. However the current tariff situation plays out, those companies that focus on communicating openly and candidly with their customers, that work to solve problems collaboratively, will be better positioned than those that lose focus and chase quick fixes.
Correspondingly, the importance of good value, regardless of price, is never out of style. The elements of “value” are relative and shift with market conditions and customer needs, but the importance of creating and communicating value is critical, particularly in a disrupted environment.
For consumers anticipating higher prices, it will be critical to demonstrate that while the price may be higher the added value outweighs and more than justifies the cost. Time to put our marketing hats on because saying “it costs more because of tariffs” is not going to convince anyone to part with scarce discretionary dollars.
These are dynamic and challenging times, but they are not beyond the furniture industry’s ability to survive and even thrive.
See also:
- A few thoughts on recent tariff activity | Jerry Epperson
- Closing de minimis loophole proving to be a customs challenge | Bill McLoughlin
- 3 things to watch in 2025 | Bill McLoughlin
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