Palliser Furniture manufacturing 300 local jobs Company‘s sales spiked as federal tariffs levelled the playing field on cheap foreign imports
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Hey there, time traveller!
This article was published 04/04/2022 (428 days ago), so information in it may no longer be current.
One of Canada’s largest furniture makers plans to create 300 Winnipeg-based jobs by the end of 2022.
Palliser Furniture has seen a dramatic boost in sales over the past couple years due to the pandemic, new tariffs on foreign imports and a widespread increase in environmental consciousness.
“There’s a re-shifting — I would say onshoring — process going on where retailers want to get more products made domestically, or on the continent, rather than offshore,” said Peter Tielmann, Palliser’s president and CEO.
The company is looking to address Canadian demand in Winnipeg, Palliser’s home base. It’s expanding its near 500,000 square feet of manufacturing space — where the brand’s chairs, sectionals and other wares are made — with another 130,000 square foot facility (costing roughly $20 million).
Palliser has already begun hiring, Tielmann said. The company will continue to recruit production staff, supervisors and engineers, among others, in the coming months.
It’s adding over 400 jobs at its plants in Mexico to meet sales in the United States, Tielmann said.
Orders for Palliser products jumped 15 to 20 per cent when Canada imposed tariffs on Chinese and Vietnamese furniture imports, Tielmann said.
“We’ve seen an increase right away,” he said.
“There’s a re-shifting– I would say onshoring — process going on where retailers want to get more products made domestically, or on the continent, rather than offshore.”
– Peter Tielmann, Palliser president and CEO
In 2020, Palliser and other companies initiated an investigation by the Canadian Border Services Agency into “dumping” practices by the eastern countries.
They argued China and Vietnam were exporting goods to Canada for much cheaper prices than the countries’ local market prices.
“We said, ‘Look, if nothing changes, we cannot stay here,’” Tielmann said. “It’s impossible, because we’re dealing with unfair trade practices. It doesn’t matter how low we drop our prices, we can’t fight against it.’”
Last September, the Canadian International Trade Tribunal ruled in favour of Canadian furniture manufacturers. The independent quasi-judicial body said such practices coming out of China and Vietnam had “caused injury to the domestic industry.” Canada imposed tariffs.
Tariffs on Chinese and Vietnamese companies importing upholstered furniture could climb as high as 204 per cent.
“The downside is that, for people buying furniture, they’ll probably have to pay more.”
– Barry Prentice, supply chain management professor at the University of Manitoba
Last May — before Canada’s final decision — Ottawa imposed tariffs of up to 295 per cent on imported upholstered furniture from the two countries.
“The downside is that, for people buying furniture, they’ll probably have to pay more,” said Barry Prentice, a supply chain management professor at the University of Manitoba.
The Retail Council of Canada vocally opposed the new tariffs last year.
“On the one side, you could say, ‘Oh my goodness, I have to pay more for my table,’ but on the other side, we’ve got fair competition, so people can have jobs here in Winnipeg too,” Prentice said.
He called Palliser’s Monday announcement “good news for North America”.
“Three hundred jobs here in Winnipeg, that’s a good boost to our economy,” Prentice said. “Three hundred jobs means 300 families.”
New tariffs are rare since the world has largely shifted to free trade, Prentice said. Tariffs often aren’t considered good policy — consumers pay more — but in some cases, they have their role, he said.
“Three hundred jobs here in Winnipeg, that’s a good boost to our economy”
– Barry Prentice
“If you need tariffs to always sustain your income (and) you never export anywhere else, (you) basically become hidden behind a tariff wall,” Prentice said.
A shift to reducing carbon emissions has also favoured Palliser, Tielmann said. More consumers are looking to buy local.
“If you bring products, bulky items like furniture from across the ocean, that’s a huge carbon footprint,” Tielmann said. “Making it closer to market produces a much lesser carbon footprint.”
Sustainability and being climate conscious are big drivers of Palliser’s work, Tielmann said. The company aims to build products that last a lifetime, leading to less being thrown away, he added.
Palliser’s sales are up compared to pre-pandemic, Tielmann said. The climb began as people settled in at home and started changing their interiors.
“The question we’re asking ourselves (is) ‘How long will this last?’” Tielmann said.
Palliser is expanding because of shifts to onshoring rather than pandemic trends; the latter is temporary, Tielmann added.
The company employs around 4,300 people, including about 1,200 in Winnipeg, where the company is headquartered.
Global volatility and the rising costs of goods — which trickles down to the customer — could damper future sales, Tielmann said.
Still, Canada’s furniture manufacturing sector is “back to reinvestment and growth… and also innovation,” he said.
gabrielle.piche@winnipegfreepress.com
Gabrielle Piché
Reporter
Gabby is a big fan of people, writing and learning. She graduated from Red River College’s Creative Communications program in the spring of 2020.
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Updated on Monday, April 4, 2022 7:03 PM CDT: Removes extra space from deck
