On social media Friday, President Trump stated that the federal government is investigating imported furniture and will finish the investigation in 50 days. Markets were shook by the statement, which caused shares of several large furniture retailers to drop on Monday. Wayfair’s stock closed down 5.9%, while Restoration Hardware’s parent company’s stock dropped 5.3%. Williams-Sonoma, which owns West Elm and Pottery Barn, saw its stock decline 2.7%.
President Trump could place tariffs on furniture soon
A White House spokesperson clarified on Monday that the review is not new. The government already looks into timber, lumber, and related products like cabinetry, which includes furniture. “This is all speculation until we actually release paper breaking down what’s being tariffed and to what extent,” the spokesman said.
This week, industry groups anticipated the investigation’s findings, but the Commerce Department has not made any recommendations. Because of the ambiguity, businesses are unsure if Trump’s comments will cause the review to take longer than expected.
Wayfair claimed that tariffs had little impact on its prices because it does not directly import the majority of the goods it sells on its website. The company claims this is due to its “inventory-light” business model. “The marketplace forces of our inventory-light model give us unmatched flexibility,” Chief Executive Niraj Shah said. A Wayfair spokeswoman added recently, “we continue to monitor the evolving trade landscape and remain confident in our ability to adapt as needed.”
Citing states like Michigan, North Carolina, and South Carolina, Trump presented more tariffs as a means of bringing production back to the United States. In June, Gary Friedman, the CEO of RH, stated that the company is already less dependent on China. China will supply just 2% of its products by the end of the year, compared to 16% earlier this year. By 2025, the company plans to produce more than half of its upholstered furniture domestically, mostly in North Carolina. “It’s kind of chaotic and unpredictable,” Friedman said of the tariff environment, but added, “we have proven we are well positioned to compete favorably in any market conditions.”
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