Business
Small furniture retailers face existential tariff threat, despite Supreme Court ruling
A worker walks through rows of American-made furniture at Warehouse Showrooms Furniture in Alexandria, Virginia, US. President Donald Trump’s sweeping new tariffs officially took hold Thursday, as he barrels forward with his turbulent push to reshape global trade.
Bloomberg | Bloomberg | Getty Images
The Supreme Court struck down President Donald Trump’s so-called “reciprocal tariffs” on Friday. Regardless of the ruling, there’s little comfort to be found for the furniture industry.
Furniture importers are facing steep import duties after the industry was hit with higher tariffs on items such as couches, kitchen cabinets and vanities last fall under section 232 of the Trade Expansion Act.
While Trump’s country-specific “liberation day” tariffs imposed under the International Emergency Economic Powers Act and announced in April were under review by the nation’s highest court, the duties specific to furniture importers, of around 25%, were not.
Compounding the issue is a constant thread of uncertainty plaguing the industry, said Peter Theran, CEO of the Home Furnishings Association, the trade group representing furniture retailers.
The 25% duty on certain furniture imports was supposed to rise to 50% in January, but at the end of December, that plan was pushed back to 2027. Its also become common over the past year for Trump to threaten new tariffs on various imports that never end up getting enacted.
“This is a very, very difficult time to manage your business,” said Theran. “The No. 1 driver of the difficulty of managing your business is unpredictability and an inability to make alternative plans and invest in those plans, because you don’t know what tomorrow will be.”
Rising distress
Tariffs and the uncertainty they’ve brought are the latest blow to the furniture industry, which has been struggling for the past four years and was under pressure well before Trump’s trade war.
During the Covid-19 pandemic, when people were stuck at home and flush with cash, many Americans took the opportunity to refresh their spaces and buy new furniture and decor. Then, low interest rates brought a surge in demand for new homes, which served as a catalyst for furniture buying.
The result was outsized growth across the home goods industry and boom times for furniture.
But as inflation and interest rates began to creep up in 2022, the sector started to sputter, and it later declined for the first time in at least seven years, according to data from Euromonitor.
By the time tariffs came around, home sales had slowed and some furniture companies were already struggling to keep operations afloat and couldn’t manage the sudden increase in fixed costs.
American Signature Furniture, the parent company behind Value City Furniture, declared bankruptcy late last year after nearly 80 years in business. It began liquidation sales at its 89 remaining stores last month.
In a court filing, the company said the aftermath of the Covid pandemic, subsequent shifts in consumer spending and rising costs led to a 27% decline in sales between 2023 and 2025. Net operating losses ballooned from $18 million to $70 million during the same time period, it said.
By the end of 2024, the company was facing “significant liquidity constraints,” which were then “further exacerbated and accelerated by the introduction of new tariff policies,” the company said in the filing.
Over the last year, at least 10 other furniture businesses have declared bankruptcy, with some liquidating and ceasing operations altogether, according to a CNBC review of federal bankruptcy filings.
Most of the companies are smaller businesses, which have been hit harder by tariffs because they have fewer resources than their larger competitors.
“The smaller players are definitely the ones that will be the hardest hit because they don’t necessarily have deep pockets, they don’t have the economies of scale, they don’t have the huge sourcing teams that can suddenly look to pivot the destination or the origin of the products,” said Neil Saunders, retail analyst and managing director at GlobalData. “So they are under a lot of pressure, and we probably will see more failures in that independent space.”
Joseph Cozza, whose small furniture business East Coast Innovators supplies retailers such as Macy’s and Raymour & Flanigan, told CNBC he was forced to raise prices between 15% and 18% to offset higher tariff costs, leading to a slide in demand over the holidays.
For now, Cozza said he can keep his business running but is hoping for an interest rate cut, a jolt to the housing market and larger-than-expected tax returns to spur sales.
“I’m praying for that,” he said.
If not, he might have to move his business from Philadelphia to North Carolina, where operating costs are lower, he said.
“I have a nice company with nice employees, and I pay them all a really good wage, and I’m being penalized,” said Cozza. “I’m being penalized for what I do, and I just don’t think that’s fair.”
Market share grab
The advent of tariffs has created a market grab opportunity for larger businesses, which are better equipped than smaller businesses to weather policy changes and keep prices lower.
Over the last year, some large and publicly traded furniture companies have actually been growing profits and sales despite higher costs from tariffs.
During Ikea’s fiscal 2025, it was able to keep prices relatively steady and revenue about flat compared with 2024, it said in a news release. It did report higher operating expenses but attributed the increase to an acquisition it made in the Baltics, not tariffs.
RH, Williams-Sonoma and Wayfair have all grown sales and margins even as they faced higher import costs.
In the nine months ended Nov. 1, RH saw sales grow almost 10% as margins expanded. At Williams-Sonoma, sales grew about 4% in the 39 weeks ended Nov. 2 while operating margins grew slightly. Wayfair, which reported fourth-quarter results on Thursday, saw revenue grow 5.1% in fiscal 2025 as gross margin stayed steady and operating expenses fell.
Wall Street has yet to see the full impact of furniture-specific tariffs on these companies because most of them last reported results right around the time the tariffs were enacted.
But they already faced a wide array of duties throughout 2025. Most U.S. furniture imports come from China and from Vietnam and other parts of southeast Asia, which have seen a range of higher tariffs before furniture-specific levies were introduced. At one point, imports from China were tariffed as high as 145%, while Vietnam faced tariffs of around 20%.
Those country-specific duties were the ones struck down by the Supreme Court. At the heart of the case was whether Trump had the legal authority to impose what he called reciprocal tariffs, which critics said infringed on the power of Congress to tax.
A reversal of those tariff rates means even more uncertainty. Chief among the questions now is how the tariffs will be refunded and whether the administration will come up with new ways to implement trade initiatives.
“A CEO of one of the largest furniture retailers in the country said to me, ‘Even if tariff strategy ended up with the worst possible outcome for my business, I would then create a plan, invest in that plan, execute under that plan and create the best outcome that’s available,'” said Theran of the Home Furnishings Association.
“No one can do that,” he said. “No one can invest in a plan now, because the tariff strategy has not stabilized. It keeps changing.”
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Broad-based rally fuelled by de-escalation hopes as investors turn optimistic about global peace
KARACHI:
The Pakistan Stock Exchange (PSX) opened on a distinctly bullish note as a renewed whisper of global calm set the tone for trading on Tuesday. The benchmark KSE-100 Index surged sharply in early hours, reflecting a wave of optimism among investors. At 9:39am, the index was hovering around 164,322.07, with gains of 3,730.74 points or 2.32%. It was then trading at 164,782.58, advancing with 4,191.25 points, or 2.61% at 12:34pm.
The rally follows growing expectations of a possible resumption of diplomatic talks between the United States and Iran, reviving hopes of de-escalation in a conflict that has shaken global financial markets.
The shift in sentiment comes in stark contrast to the previous session, where the market endured heavy losses amid failed negotiations and a spike in oil prices, triggering widespread panic selling across sectors.
Today, however, investors appear to be pricing in a different narrative – one where diplomacy may yet prevail. The prospect of renewed dialogue has eased concerns over supply disruptions and runaway energy prices, both critical variables for Pakistan’s import-heavy economy.
Read: PSX plunges over 6,600 points as US-Iran talks end without deal
Early gains were broad-based, led by index-heavy sectors such as automobile assemblers, cement, commercial banks, fertiliser, oil and gas exploration companies, OMCs, power generation and refinery, as participants moved to rebuild positions after the recent sell-off.
The sharp rebound underscores the market’s sensitivity to geopolitical signals, where even tentative progress towards peace can ignite strong bullish momentum.
Despite the upbeat start, analysts caution that volatility may persist, with much depending on whether diplomatic efforts translate into concrete outcomes. “Investors are optimistic about the likely resumption of talks between the US and Iran,” AKD Securities Director Research Mohammed Awais Ashraf told The Express Tribune.
Timely affirmation from Saudi Arabia and Qatar to bridge the gap in external financing to be created by the payment of UAE $3.5 billion this month and higher imports due to elevated oil prices have also helped to uplift the sentiment, he added. This is also likely to help in the timely approval of a $1.2 billion disbursement from the International Monetary Fund (IMF) after the approval of its executive board, Ashraf predicted.
Around 65,000 young people will be able to train to enter the defence, clean energy, digital and manufacturing industries under the latest round of Government investment into colleges.
The Government will provide £175 million for 19 new Technical Excellence Colleges across the country to deliver training in sectors deemed important for the future of the UK.
Minister for skills Baroness Jacqui Smith said the investment would help build a pipeline of skilled workers for industries key to Britain’s future.
The Government has identified the areas most likely to help grow the economy, Baroness Smith told the Press Association, and said given the war happening in the Middle East, the UK needed to be able to support different ways of getting its energy.
“The Clean Energy (technical excellence colleges) that we’re announcing today will help us to develop that to speed up our shift to clean energy, to protect our energy supply and to help people with their bills,” she said.
“In the area of defence, where, given the instability and some of the new challenges to our defence in the world, and our contribution to that, this Government has pledged a big increase in defence spending that needs to support our armed forces and our capacity, but that spending also needs to deliver quality jobs to the UK defence industry, who will need skilled people in order to be able to deliver it.”
It is estimated nearly 600,000 additional workers will be needed in these key sectors by 2030, the Department for Education said.
If follows the first wave of 10 technical excellence colleges announced last year specialising in construction.
Prime Minister Sir Keir Starmer said: “I want every young person to know there is a clear route into well‑paid work, whatever their background. These colleges put technical skills front and centre, opening up high‑quality jobs in the industries driving Britain’s future.
“We are backing talent across the country, strengthening our workforce and making sure opportunity is built into the system – not left to chance.”
The colleges may spend the funding they receive on specialist equipment, developing new courses, training more specialist staff, and more.
On Monday, Baroness Smith met students and staff at Milton Keynes College, selected as a technical excellence college for digital, where students are already learning about robotics and artificial intelligence (AI).
It comes after the latest figures showed nearly a million (957,000) 16 to 24-year-olds were “Neet” (not in education, employment or training) in October to December 2025.
The high number of young people who were Neet was a “loss of opportunity” and a “loss for the country”, Baroness Smith told PA.
“That’s why we need really high-quality provision for young people between 16 to 19 to be able to access,” she said.
“We need our schools to better identify the young people who are potentially going to become Neet, we need them to take responsibility for making sure that young people have got the places, the college places, the apprenticeships, the jobs to go into.
“And we need brilliant colleges like Milton Keynes, where I am today, to be supported, to be able to provide the opportunities for young people who would otherwise be lost at such a crucial time in their lives and for the future of the skills that we need as a country as well.”
The Government has set a target for two-thirds of young people to be in higher education, higher-level training or doing a gold standard apprenticeship by age 25.
Jawad Al Midani, 21, started studying at Milton Keynes College for a Level 1 course, and has since worked his way up to studying for a Higher National Diploma (HND) in cyber security.
“I feel as soon as I finish my qualifications I’ll be ready to start my career,” he told PA.
Christian Proctor, 18, who is studying for a Higher National Certificate (HNC) in games design and will go on to an HND next year, said he was confident the skills he was learning would equip him for the next step once he finished college.
The 19 new Technical Excellence Colleges are as follows:
Defence
– Blackpool and The Fylde College– City College Plymouth– Lincoln College– RNN Group– Yeovil College
Clean Energy
– Colchester Institute– South Bank Colleges– The City of Liverpool College– The Education Training Collective– University Centre Somerset College Group
Digital and Technologies
– Birmingham Metropolitan College– Capital City College Group– Gloucestershire College– LTE Group– Milton Keynes College
Advanced Manufacturing
– City of Wolverhampton College– New College Durham– Newcastle and Stafford College Group– Weston College of Further and Higher Education
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