by While many have incorporated price increases into their product mix, the future remains uncertain as more changes could be in store
HIGH POINT — In typical premarket fashion, new products were the main area of emphasis and topic of conversations that dealers had with suppliers here this week.
That said, the inevitable subject of tariffs lurked in the background as current pricing — whether through across-the-board increases or tariff-related surcharges — reflects country-specific rates on Vietnam, Malaysia, Indonesia and India, to name several key furniture-sourcing destinations.
Yet for many, that may have been the easy part, particularly as unknowns remain in the weeks ahead.
For one, Washington is expected to determine in less than a month whether there will be furniture-specific tariffs tied to a Section 232 investigation on lumber and finished wood product including furniture. Secondly, the U.S. Supreme Court is expected to hand down a decision sometime in November on whether the administration overstepped its bounds in implementing tariffs in the first place.
Despite the uncertainties, retailers from around the country were eager to see the latest designs in case goods and upholstery. Bernhardt reported strong attendance this week with about 45 appointments, compared to anywhere from 40 to 55 during a typical premarket.
“They mostly think about how can they have the best product to gain the most market share for their stores, and we look at it the same way,” said Alex Bernhardt Jr., president and chief executive officer of Bernhardt Furniture.
He added that as the company has created some efficiencies in its product development and execution, there is not much difference between the cost of the product a year ago and today.
“Our goods are aggressively priced,” he said, adding, “So price points did not go up 20% — it’s probably more like two or three.”
He added that the times demand companies take an even more aggressive role in creating overall value in their product mix.
“It’s been a tough time for furniture and it has not been very robust even without the tariffs,” he said. “So we have to continue to be aggressive. We are very optimistic, but it’s going to be about market share.”
Companies also have had to be strategic about where they source goods, focusing on lower-tariff countries and putting the brakes on higher-tariff countries such as India.
For example, while it is selling pre-tariff India goods out of its warehouse, HH2 Home has put shipments from India on hold for now. It does plan to show some new products from India at market including some accent pieces, dining and occasional tables. But how that sells depends on whether the two countries come to an agreement to lower the rate down from 50%.
“Some of the things India does are so unique you can’t replicate it elsewhere,” said Lee Boone, chief executive officer of HH2 Home and sister companies Vogue Home and Hawthorne Home, noting that as soon as there is some resolution to the India tariff situation, the company is ready to resume production and shipments from that country.
The rest of the company’s line is primarily from Vietnam and Malaysia, which currently face tariffs of 20% and 19% respectively, making any similar new product much more affordable than India at this stage.
Paul Comrie, chief executive officer at full-line case goods and upholstery resource Elements International, told Home News Now that starting price points are important as prices are going up because of tariffs. Thus it offered a wide mix of starting-price four-piece paper laminate bedrooms retailing from $699 to $799, along with competitive values in dining and stationary and motion upholstery. The pricing includes tariffs, Comrie said.
“Our retailers are coming to us looking for a price point, because prices are going up,” he said, noting that the company has seen a 50% increase in business since the April 2 Liberation Day announcement identifying tariffs on some 180 countries from around the world.
At premarket, wood furniture resource FD Home showed several wood veneer bedrooms retailing from $2,199 to $2,699 and two casual dining sets retailing around $899. It also plans to show four additional veneered bedrooms and another dining set at the October market falling in similar price points.
However, it is also bringing in seven new paper bedrooms for market featuring melamine tops on cases. Retailing from $999 to $1,299-$1,399 for four pieces, the goal is to offer sharper price points than its typical wood bedroom line amid an influx of products on the floor that reflect higher prices resulting from tariffs.
“How do you help retailers and consumers? — You come out with lower-priced product,” said company President Steve York.
As part of a good-better-best strategy, Pulaski Furniture showcased about 10 new bedrooms, some of which also were shown with companion dining. Four-piece bedrooms were targeted to retail from $1,999 to $3,999 with most falling within the $2,499 to $2,999 range. All are made in Vietnam.
While the mix is priced to include the 20% tariff on Vietnam products, they also include step-up features such as undermount, soft-close drawer guides and nightstands with lighting built into the base, plus USB port and charging capability, noted President Adam Tilley.
“These are now on every group,” he said. “We are adding more value by adding features, and we have good factory partners to help us make sure we are hitting the right price points.”
Case goods resource Austin Group showed 18 new bedrooms at premarket, with most falling within the $1,699 to $1,999 range for a bed, dresser, mirror and nightstand. Reaction was mostly positive as the company reported getting a number of early commitments.
“It’s still a value,” said Steven Lim, vice president, of the pricing which included Vietnam tariffs. “Everyone’s going to end up paying the tariff one way or another.”
Magnussen Home also reported a good premarket with strong interest from dealers in its good-better-best mix of product, including a range of laminate to veneered case goods.
At premarket, it showed five new bedrooms, a new dining set and a dozen new occasional groups. And based on the success of several inline groups, it also offered line extensions that added categories such as bedroom, dining and even home office furniture to the mix.
“Retailers were shopping the market,” said Michael Pitman, senior vice president. “They were engaged.”
Roger Turnbow, president of full-line furniture resource A.R.T. Furniture, described the mood at premarket as “surprisingly positive.”
“Some retailers said they had a good summer,” he said, adding that August was A.R.T.’s strongest month of the year. “There is still some demand there.”
But he also believes that the reality of higher prices will soon set in among consumers as they see product on floors that reflects increased tariffs that went into effect in early August.
“It hasn’t rolled in yet to retail floors, but I think this fall we will start to see that,” he said. “And then people will start to say, ‘Oh it’s real.’”
He added that A.R.T. is sharing in part of the cost, which he noted is “not easy to do, to give up margin.”
While costs are being shared between the manufacturer, the importer and the retailer, some costs, he said, ultimately will have to be passed on to consumers.
“There is no way around it,” he said. “No one can afford to absorb that kind of increase. That is all margin and sometimes that is all you are living off of.”
Peter Tielmann, president and chief executive office of upholstery manufacturer Palliser, said that the company had a very good week in High Point.
“Premarket was really good for us,” he said. “We are really happy. In fact I can’t even recall the last time that premarket was that good, both from an attendance perspective and also from the acceptance of our new introductions. We are happy with both.
“It was good to see that many significant dealers, including existing dealers and some we don’t do business with right now,” he added. “We are very encouraged and satisfied with the market.”
He attributed some of the response to the company’s domestic manufacturing emphasis in both Canada and Mexico, which are tariff-free relating to furniture and other products under the U.S.-Mexico-Canada Agreement.
“We are all guesstimating what is going to happen with new additional tariffs,” he said, adding, “Right now with the USMCA we have zero tariffs still … and we expect it will stay that way.”
Noting that the agreement is up for renegotiation next year, he said there may be some changes, but “hopefully no significant changes.”
For now, he believes the company is well positioned thanks to its domestic mix that is creating interest in the market.
“Nobody knows exactly what is going to happen, but some dealers are looking just to diversify their sourcing more and to be safer in the distribution of where they buy from, for sure,” he said.
