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Thinking of buying a new couch? The price may have just quadrupled
With more than 40 years of experience, Love Dodd of Victoria thought he had seen everything the furniture business could throw at him.To get more news about wholesale furniture, you can visit oppao.com official website.
But even he almost jumped out of his chair when he saw the size of new tariffs that were slapped on a lot of his merchandise earlier this month.
"We personally got hit with a couple of hundred thousand dollars," he said in an interview. "That's been a huge blow for us."
On May 5, the federal government imposed tariffs of up to 295 per cent on imported upholstered furniture from Vietnam and China. With three furniture stores across Vancouver Island, Dodd says the impact on his business, which employs roughly 80 people, was almost immediate.He recalls a customer who came into one of his stores recently and tested out a recliner that was priced at $698. "If they come to my store today, it's going to be $2,598," he said. "It's not affordable."Ottawa imposed tariffs after a half dozen Canadian furniture producers complained that products from Vietnam and China were being dumped into Canada at prices that were wildly uncompetitive.
Winnipeg-based Palliser Furniture is the company that got the process started. While it declined an interview request, the manufacturer's letters to government officials lay out its reasoning. According to government data, roughly $475 million worth of upholstered sofas and chairs subject to the new tariffs get imported into Canada every year, the majority of which come from China.
Palliser says less than 20 years ago, Canadian manufacturers produced well over half of those items sold in Canada. Today, it's barely one-sixth.According to Palliser, the flood of cheap products, primarily from China, is hurting Canadian companies. "There has been a significant loss of jobs across Canada as a result of the unfair competition from China in particular," one of the company's submissions to the Canada Border Services Agency says.
Exporting items at prices below what they would sell for domestically is known as dumping, and it's a contentious issue in international trade law.
Unpopular though they may be with consumers, tariffs are one of the bluntest instruments available to governments seeking to level the playing field.
Complaints about unfairly priced Chinese and Vietnamese-made products have been a long simmering issue in the furniture business, so while Dodd says he had an inkling something was coming, he was expecting tariffs in the range of 10 to 20 per cent, similar to what the U.S. recently implemented.