'Pain in the butt': How a big Florida furniture importer tackles Trump's new tariffs

Dining room chairs from Vietnam. Patio recliners from China. Rugs from India. A City Furniture showroom is a global marketplace of imports.

City Furniture is one of the largest importers using PortMiami. It brings in home furnishings from around the world, destined for one of its 25 stores throughout Florida.

And many of those imports now face much higher tariffs from President Donald Trump’s efforts to reignite American manufacturing by making foreign-made goods more expensive.

“It's definitely affecting us,” said City Furniture CEO Andrew Koenig. “We're still full speed ahead, but it's challenging.” He spoke to WLRN the day before Trump announced unprecedented increases to tariffs on products from dozens of countries.

Businesses relying on foreign factories like City Furniture are now navigating the network of tariffs from 10% to almost 50%. While Trump’s action was long-expected, the expansive and potentially expensive import taxes have caused global stock markets to reel, economists to increase the odds of a recession and brought new levels of uncertainty for consumers and companies.

About two-thirds of the products sold by the Broward-based retailer are imported.
“Whenever there's a variable in our business that is creating some level of uncertainty, you're on pause,” Koenig said. He was bracing for tariffs, calling the preparation “a big headache and a big pain in the butt.”

Koenig does not anticipate passing along his higher costs to his shoppers. But he doesn't think they’ll be spared, either. “It's very disruptive. The customer is going to take a bit of a hit. We're going to take a hit,” he said.

City Furniture has thousands of products in its brick and mortar stores across the state and online. It’s a complex pricing strategy to respond to consumer tastes and financial means. Koenig expects to spread out the impact of tariffs throughout his product lineup.

“It's a very complicated merchandising chess game. It's not just one product, one price source,” he said.

Foreign furniture

The global furniture-making industry has been shifting in recent years, and the shipping traffic at PortMiami reflects the changes. About half of all foreign-made furniture coming to the U.S. in 2018 was made in China. That has fallen to 21% last year while Vietnam has doubled its market share of imported furniture and furniture parts, according to data shared with WLRN from USTradeNumbers.com.

Some of the highest tariffs announced by Trump are targeted at China and Vietnam. Chinese imports face a 34% tax. On Monday, the president threatened another 50% tax on China goods if China didn’t back away from its own retaliatory tariff announced late last week. Vietnamese goods are taxed at 46% under the White House tally.

“When it's less stable, when it's more risky, when it's more uncertain, we're going to be more cautious in our decision making. I would argue that that would slow us down.”<br/>

Both China and Vietnam are top 10 importers at PortMiami. Other top trading partners face tariffs, including European Union member countries Italy, France and Spain with 20% taxes, and Dominican Republic, Honduras and Peru in the Caribbean and Latin America facing 10% tariffs.

While South Florida is not a big player in the global trade of furniture, City Furniture is a big presence as one of the largest importers at the port. About two percent of overseas furniture coming into the U.S. is shipped to PortMiami.

“ We're globally sourced,” Koenig said. “ If it just so happens that furniture is in China or made in Mexico or Canada or whatever, we're going to bring it in and pass on that best possible value that we possibly can.”

Made in the USA

Trump’s executive order putting the new tariffs in place blames America’s trade deficits in goods for hurting manufacturers. Decades of trade policy helped stoke the search for lower cost providers, which in turn helped drive consumer demand thanks to lower prices.

City Furniture has spent $9 million since 2019 on its own American-made brand called Kevin Charles. It cuts and sews upholstery for sofas, loveseats and ottomans at a factory in Mississippi.  ”We understand what it takes to manufacture in the U.S.” said Koenig.
The number of people employed making furniture in America has been in a long-term downtrend. Almost 700,000 people worked in the industry at the turn of the century. Only half the number of jobs remain 25 years later, according to the Bureau of Labor Statistics.

Technology has played a role, as it has in many manufacturing roles. So has global trade. The drop in furniture-making jobs has come even as the nation’s population has increased along with its demand for more home furnishings.

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Koenig is skeptical that the Trump tariffs will lead to a renaissance of American furniture building. “I don't think there's any American manufacturing that's capable of doing the volume that we need in order for our dining tables or our bedrooms,” he said. “I don't know of any factories that could even come close to passing on the values that we need, that our customers expect every day.”

City Furniture CEO Andrew Koenig. (4000x6000, AR: 0.6666666666666666)

Furniture prices have experienced much less inflation through the past few decades compared to overall consumer costs. Household furnishings inflation was just half the rate of consumer inflation in February. Koenig recalled his father, City Furniture co-founder Keith Koenig, remarking how he sold sofas for $300 years ago and some models remain at that price point today.

Headwinds

The Trump tariffs are just the latest uncertainty for companies tied to real estate like City Furniture. Consumer sentiment among Floridians has been falling, especially their view of their future financial conditions.

“The sharp drop in spending intentions is notable. While changes in spending intentions don’t necessarily translate into changes in actual spending, a significant decline suggests Floridians may be shifting toward more cautious economic behavior and could postpone discretionary spending, particularly on big-ticket items. This could slow economic activity, especially in retail and hospitality sectors,” said Hector Sandoval, director of the Economic Analysis Program at the University of Florida’s Bureau of Economic and Business Research.

Home price growth has slowed considerably and the pace of condominium sales continues to slump for units below $1 million.

“The economy, the housing market, the consumer confidence – we're going to evaluate all those variables,” Koenig said. “When it's less stable, when it's more risky, when it's more uncertain, we're going to be more cautious in our decision making. I would argue that that would slow us down.”