Huge homeware brand suddenly closes and fires all its staff as Trump's tariffs come into effect
A North Carolina homeware company has been forced to shutter as President Donald Trump's hefty import tariffs hit the furniture industry hard.
Progressive Furniture, a division of Sauder Woodworking based in Claremont, North Carolina, announced its plans to close down and fire all 30 of its employees by the end of the year.
The firm sells high-quality traditional and modern homeware at Walmart, Target and Home Depot.
'This decision was not made lightly, and we understand the impact it will have on our employees, customers and partners,' Progressive Furniture CEO Dan Kendrick told The Street.
'We are committed to supporting our employees through this transition and will aid where possible to help them find new opportunities.'
While the CEO said that Trump's seismic changes to the world economy did impact his decision to close the business, there were other factors involved.
Although it is an American company, its main supplier was based in Rosarito, Mexico.
That manufacturer, Baja Wood, was responsible for more than 60 percent of Progressive's inventory. The rest of its products came from factories throughout Asia.
Progressive Furniture, a division of Sauder Woodworking based in Claremont, North Carolina, announced its plans to close down and fire all 30 of its employees by the end of the year (pictured: a Progressive couch sold at Walmart)
Progressive Furniture CEO Dan Kendrick said the North Carolina-based company has to close down because 60 percent of its product is imported from Mexico
But the Mexican supplier's internal dilemmas resulted in its demise, Home News Now reported.
Problems began back in January, when about 60 of Baja Wood's 320 employees rallied in front of the factory in protest of reduced hours.
Government labor investigators were called upon to evaluate the situation and production halted.
However, once the investigation was closed, Baja Wood never reopened.
Progressive Furniture was founded as a family business in 1985. In 2001, it was acquired by Sauder Woodworking, one of the top-five residential furniture retailers in the US.
Stores across the US, including Walmart, Target and Home Depot, as well as websites Wayfair and Amazon, sell Progressive homeware.
In the meantime, Trump imposed a staggering 25 percent tariff on Canadian and Mexican imported goods.
He first proposed these taxes in February, but they were not implemented until early April. USMCA-compliant items can be shipped into America tax-free under these regulations.
Trump has said if Canada and Mexico met his immigration and drug-trafficking demands, he may consider slashing tariffs to 12 percent, PBS reported.
Kendrick said the decision to shut down operations was not a direct result of these tariffs, but they were factored into the situation.
'I am not in any way going to say that this was due to the tariffs, but it did impact the decision,' he told Home News Now.
The North Carolina 250,000-sqaure-foot warehouse's inventory was running low of Progressive's best selling items 'because we weren't getting any production.'
On Wednesday, Trump declared that foreign trade and economic practices have sparked a national emergency
Progressive Furniture was founded as a family business in 1985. In 2001, it was acquired by Sauder Woodworking, one of the top-five residential furniture retailers in the US
Progressive Furniture has prided itself on its affordability and has imported products from Mexico and Asia (pictured: Progressive bedroom set)
Kendrick speculated that his company's downfall was a result of poor timing, calling the combination of Baja Wood's protests and Trump's tariffs 'the perfect storm.'
'If this was six months ago, or six months later, I don’t know if we would have the same outcome,' he concluded.
Progressive Furniture has prided itself on its affordability, so Kendrick explained even if production was able to continue, costumers would not likely be able to afford its items.
'I think at the end of the day, our end consumer just has no money,' he bluntly told Home News Now.
'They are tapped out on their credit, they have no money and they are struggling to buy a $17 burger that used to be $7.
'I understand that the higher-end business is decent still, but for anybody that is in this mid-to-lower price range it is just a struggle.'
Prepac closed down its British Columbia location on March 14, leaving 170 employees jobless
As the American company is preparing to shutter for good, Canadian furniture brand Prepac has shifted all of its production to US soil
As the American company is preparing to shutter for good, Canadian furniture brand Prepac has shifted all of its production to US soil.
On March 14, its Delta, British Columbia facility shut down. All 170 Prepac workers will be officially severed by May, the Vancouver Sun reported.
The company will be continuing production, but only out of its Whitsett, North Carolina plant, which was purchased in 2021.
'Our union has been warning about lost investment and production since Trump began his economic war on Canada and Canadian workers,' Lana Payne, the president of Unifor National, the union representing Prepac workers told The Street.
'In this case, Prepac and its equity owners are using tariffs as an excuse to redirect all their production to the U.S. It's pure greed.'
Further elaborating to the Vancouver Sun, Payne said: 'Our union has been warning about lost investment and production since Trump began his economic war on Canada and Canadian workers...It’s pure greed.'
However, Prepac CEO Nick Bozikis has denied that tariffs had anything to do with this drastic move, saying this has been in the works for several months.
'The decision to centralize production into our North Carolina facility was the product of many months of consideration and analysis, and began long before any tariff risks to Prepac’s business arose,' he told the outlet.
Stores across the US, including Walmart, Target and Home Depot, as well as websites Wayfair and Amazon, sell Progressive homeware
Kendrick speculated that his company's downfall was a result of poor timing, calling the combination of Baja Wood's protests and Trump's tariffs 'the perfect storm' (Pictured: a Progressive Furniture dining room set)
'The closure of our Delta facility is a necessary step that reflects the realities of Prepac today, and the prospects for the company going forward.'
On Wednesday, Trump declared that foreign trade and economic practices have sparked a national emergency.
During his address in the White House Rose Garden, the president announced all nations will be faced with at least 10 percent tariffs on all US imports, which started on Saturday.
But Canada and Mexico were exempt from the 10 percent baseline tax because of the pre-existing import taxes he hit the countries with.
He also announced more than 90 countries will be hit with additional reciprocal tariffs in order to make the US 'wealthy again' on April 9.
The president claims his tariffs will encourage domestic manufacturing by increasing the price of foreign products.
