‘Streamlined structure’: Palliser Furniture cuts executive leadership team

Winnipeg-based Palliser Furniture has restructured its executive leadership team, reducing it to four people from eight.

Company president and CEO Peter Tielmann announced the changes in an internal memo to employees on Wednesday.

“In addition to the ELT changes, layoffs were carried out today as a difficult but necessary step in aligning with the new organizational model,” Tielmann wrote in the memo, obtained by the Free Press.

“They will not only impact how we’ll operate our company moving forward but will be the catalyst to allow for further innovation and growth initiatives in product, sales and marketing.”

The individual performances of the employees who were let go did not affect the decision to lay them off, Tielmann added, noting all of them made “countless positive contributions” which the company is grateful for.

Tielmann was not available for an interview. In a statement to the Free Press, he said the company made changes to its organizational structure to better align with the evolving needs of its business.

The company has reduced its Winnipeg workforce by 11 administrative positions, he added. The changes “do not affect our direct manufacturing team.”

“Looking ahead, this streamlined structure will enable us to sharpen our focus and strengthen our investments in product, sales and marketing — positioning Palliser for long-term growth and a strong future,” Tielmann said in the statement.

The announcement of the restructuring came two weeks after the government of Manitoba ordered a $15 million loan guarantee requested by Lexington Real Estate Holdings Ltd., which owns Palliser Furniture.

“We are grateful for the support … which has helped us protect jobs within our Winnipeg-based manufacturing facility,” Tielmann wrote in his statement to the Free Press.

Founded in 1944, Palliser Furniture is known for its upholstered leather furniture. It supplies retailers including EQ3, which it owns.

As of July 2024, the manufacturer had a global staff of around 3,500. That month, Tielmann told the Free Press lower orders were impacting the entire furniture industry. Order levels had not rebalanced following a surge during the COVID-19 pandemic and a drop following the pandemic, he said at the time.

Furniture sales are “soft” right now, said Bill McLoughlin, editor-in-chief of North Carolina-based Furniture Today. “The business has been very, very challenging due to a number of factors, not the least of which is tariff uncertainty.”

That uncertainty has caused a lot of manufacturers and retailers to go into a holding pattern, he said this week, adding company closures, layoffs and restructurings have been “a very widespread occurrence” in the furniture industry over the last six months.

“We are writing a going-out-of-business story at Furniture Today at least once a week — sometimes multiple times a week,” McLoughlin said.

— with files from Carol Sanders

aaron.epp@freepress.mb.ca