Is the domestic furniture industry in trouble?

The answer is simple: Yes.

The past couple of years have been tough on the American-made home décor industry. Recent closures of industry giants like Mitchell Gold, United, Klaussner and Creative Metal and Wood may be a sign of times ahead.

Even though economic studies have found that the industry has been growing 4% annually, the numbers are a mean and are heavily skewed by cheaper retail outlets, such as Amazon, Wayfair and Ikea who are experiencing strong growth but sell cheap foreign-made products almost exclusively.

These same studies suggest that U.S. manufacturers are not having the same luck, however. Sales have plateaued the past few years, and the rising costs of space, labor and raw materials coupled with expensive financing have put the foot down on many companies’ figurative neck.

This industry will have to undergo large changes or risk shrinking significantly.

So, what do we do?

Optimists believe that what this industry only really needs is a complete “REBOOT” on sales and client acquisition tactics. And even though they are 100% correct, these changes take time and capital, neither of which are luxuries that many have.

There is, however, a way to ease off this figurative foot choking the industry’s neck and start on a path of growth once again.

Outsource laborious manufacturing to Mexico

Yes, some may consider this idea uncomfortable, but it is, however, necessary. It is time we adapt to survive, by sending our manufacturing, at least in part, to Mexico.

For the past few years, furniture and décor manufacturers in Mexico have been investing heavily in modernizing their manufacturing, fixing supply chain and ensuring labor is more skilled than ever before. The furniture industry houses more than 100,000 (and growing) skilled hands at a fraction of the price.

Can we really depend on Mexico? Pottery Barn, Marge Carson and La-Z-Boy are satisfied partners. Even China has begun an aggressive overhaul to move their manufacturing needs to ease their access to the U.S.

How could we possibly undertake such a bold initiative? Where would we even begin?

Find a reputable company or partner to help lead you through this phase by first analyzing your current situation, then building out the plan and leading the transition.

Studies have calculated that by outsourcing the most labor-intensive pieces, and warehousing at the border, margins increase by 15% and liquidity could increase by more than 9%.

One has to consider all of the exciting times ahead if we can all forge a new path directed toward growth and ideas.

“The moment you choose to be audacious, you plant the seeds of growth. It allows you to discover untapped
potential, unleash creativity and expand the horizons of what you thought was possible” — Julien Olvera

Jaime Gallegos is president of JGA Consulting and can be reached at

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