Tariff Turmoil in Kitchen, Bath and Design/Construction Sectors
With “Liberation Day” now behind us, the federal tariff situation has come into sharper focus after weeks of destabilizing speculation and rumors. A levy of 10% on all countries and additional specific reciprocal tariffs on the so-called “worst offenders” has been imposed, and reactions have been intense around the world.
But wait! On April 9, the administration paused most reciprocal tariffs – save for China, which is currently facing a 125% levy – for a period of 90 days. At 2:10PM EST, Goldman Sacks announced that as a result of this pause, it was no longer forecasting a recession, saying “We are reverting to our previous non-recession baseline forecast with G.D.P. growth of 0.5% and a 45% probability of recession.”
Whether looking to the economic model of the late 1800s in the 21st century is fore- or short-sighted, we shall have to wait and see. In the meantime, here are some thoughts from kitchen & bath brands and organizations and financial institutions on the situation.
This is a developing story and will be updated.
Tariff Impact on Small Businesses in the Construction Industries
Ben Johnston, COO of small-business lender Kapitus, sees that in the short- to medium-term, the tariffs are likely to drive inflation significantly higher and cause significant disruption to the global supply chain, threatening many U.S. jobs at manufacturers, wholesalers and retailers who rely on the global supply chain to source the components, raw materials and finished products they sell.
His advice to small business owners in the construction industries:
“Business owners should be judicious in their expansion plans. In uncertain economic times, it is important to focus on goods and services that provide a demonstrated value to customers. Before launching a new product or opening a new facility, it is important to thoroughly test the market to determine demand and pricing power. Make sure that anticipated sales will more than cover anticipated expenses and be sure to have access to sufficient capital to cover several months of operating expense in case anticipated sales take longer than expected to materialize.
“For business owners who borrow money to purchase inventory, acquire equipment and fund expansion, it is important to maintain multiple financing relationships. Banks have been pulling back from lending to small businesses over the past several years, and having contacts at both bank and non-bank lending institutions can help secure the fastest and lowest-cost capital when borrowing is required.”
Tariff Impact on American Manufacturers
For 40 years, Americh has been designing and manufacturing bathtubs for residential and commercial markets in its facilities in North Hollywood, Calif. and Charlotte, N.C. Dino Pacifici, vice president of Americh, tells KBB, “We cannot be certain how the tariffs will affect pricing in relation to U.S.-manufactured items, but we feel it is very important to try and hold off the pressure to increase pricing during this inflationary period. We are not sure how long we will maintain our 2024 pricing and hope customers will value and appreciate the efforts to support USA manufacturing.”
Tariff Impact on Fixtures & Fittings
Jean-Michel Lebeau, CEO of BainUltra tells KBB, “I feel that the economic situation as a whole is fairly fragile right now. Most industry players are sitting on their hands, hoping for a swift resolution. I feel we may see some stability in the short term – but it’s mostly people hanging in there, awaiting clarity. If nothing changes in the medium term – two to three months – I think we’ll witness a drastic uptick in prices from all those who delayed action, followed by an inevitable reduction in sales volume.
“BainUltra stands in a strong position amidst this chaos. Not only are we currently protected under the USMCA agreement, but our sourcing strategies have enabled us to minimize the effects of tariffs. I’m not saying they cannot impact us – they could easily – but so far, we’ve been dodging bullets on a weekly basis. I’m very proud of our team and our partners; without them, this resilience would be impossible.
“Our clients have demonstrated extraordinary steadfastness. They’ve kept their word, held the fort strongly, and continued supporting us – something I’m deeply grateful for.
“Every week is different; a few tweets can change the world nowadays. I believe that in business, as in life, hope is not a strategy – preparation is.
“When uncertainty reigns, decisive action separates leaders from followers. I remain focused on what truly matters: protecting our prices, safeguarding our customers and partners, and preserving jobs across both borders.”
Kerry Stackpole, IOM FASAE CAE, CEO/executive director of Plumbing Manufacturers International, testified in person before the International Trade Commission in opposition to tariff proposals. Below, he shares with KBB an overview of PMI’s overall opposition to tariffs and the pro-active steps the association is taking to address the wide variety of proposed tariffs.
PMI has actively opposed Section 301 tariffs since they were initiated under the first Trump administration. PMI submitted testimony, actively lobbies on Capitol Hill and continues to be active in the Americans for Free Trade, a coalition of more than 150 trade associations, to address the issue. Dozens of plumbing products have been impacted by the 25% China tariff. They continue to serve as a hidden tax on U.S. consumers, hurting domestic producers, retailers and customers alike, and having a negative impact on the U.S. economy.
PMI is also fully engaged to ensure the threat of tariffs on our Canadian and Mexican trading partners are eliminated. We are continuing to reach out to the Trump administration, members of Congress and Mexico and Canada government officials on the negative impact the U.S. tariffs and any proposed Canada or Mexico retaliatory tariffs will have on plumbing manufacturers, the home building sector economy and the inflationary impact on consumers. PMI is asking for the administration to exempt new tariffs on building products, including plumbing fixtures and fittings.
Lastly, PMI has requested the Administration to refrain from imposing tariffs on imported copper and copper alloys and copper derivatives in the building materials sector. We urge the administration to implement balanced trade policies that safeguard our national interests, hold our trading partners accountable, reinforce supply chains, enhance U.S. competitiveness and protect American families from inflationary price increases on building materials and household appliances, including plumbing products. It is vital for the administration to differentiate between trade cheaters and trusted allies that reliably work with us to advance our national and economic security.
Tariff Impact on Home Appliances
Andrew de Lara, spokesperson, BSH (home appliances division of the Bosch Group – and home of the Bosch, Thermador and Gaggenau brands in North America) notes:
“BSH in North America – through its Bosch, Thermador and Gaggenau brands – is focusing on the long-term growth potential of the North American market and continues to further expand its business in the region. While we prioritize a local-for-local strategy, we work in an international production network, are represented globally and continuously review our flows of goods against the backdrop of constantly changing trade legislation.
“The additional tariffs announced by the U.S. are a challenge for the entire industry, and we are closely monitoring current developments and continuously analyze possible new business opportunities and challenges.
“In the United States market, we announced a price adjustment to partners at the end of March – to take effect on July 1, 2025. Per the company’s standard processes, any further details will be communicated at the appropriate times.”
Small businesses that offer small kitchen appliances are facing big concerns triggered by the tariffs. CNBC reported on Suvie, a smart countertop cooking/cooling “kitchen robot” with an enthusiastic user following. With the product manufactured in China, the Cambridge-Mass.-based company is actively investigating alternative sites for production.
Suvie founder Robin Liss is taking action. “I’m going to run out of appliances,” Liss said, ahead of a two-week reconnaissance trip to Taiwan and Vietnam. “I’ve got to figure this out.”
Tariff Impact on Lighting Products
Laurie Gross, interim president and CEO of the American Lighting Association, released a statement:
The American Lighting Association strongly opposes the administration’s decision to impose 25% tariffs on imports from Canada and Mexico, as well as the additional 10% tariff on Chinese imports, set to take effect this week. These tariffs will significantly impact lighting manufacturers, retailers and consumers, driving up costs across the supply chain and reducing competitiveness in the global market. Many U.S. lighting and ceiling fan businesses are small, family-owned companies that operate on tight margins. These tariffs will make it harder for them to compete, leading to potential job losses and reduced investment in domestic operations.
Canada and Mexico are key trade partners for the U.S. lighting industry, supplying essential materials and finished products that keep prices stable and businesses thriving. Imposing tariffs on these countries will disrupt supply chains, increase costs for American manufacturers, and ultimately lead to higher prices for consumers.
Our ALA Canadian members do a significant amount of business with American manufacturers, and these tariffs will have a negative impact on their business as well as the Canadian lighting manufacturers that sell to many of our lighting showroom members. Additionally, with a new 10% tariff on Chinese imports, many lighting products and components that are difficult to source elsewhere will become even more expensive, further straining the industry. This new 10% tariffs comes in addition to the already enacted 10% China tariffs ALA reported on here – for a total 20% increase over the past month.
ALA has consistently supported fair trade policies that strengthen American businesses without imposing undue burdens on manufacturers, retailers and consumers. We previously urged the administration to extend the suspension of the Canada and Mexico tariffs in a statement here. Tariffs act as taxes on American businesses and households, making it more difficult for lighting companies to provide affordable, high-quality products. Rather than broad tariff increases that strain key industries, the administration should pursue targeted trade negotiations that address national security concerns without disrupting economic stability.
Canada enacting reciprocal tariffs in response has added another layer of costs and complexity to our members businesses. To avoid a further escalation, all parties should return to the negotiating table to solve these trade disagreements before further economic damage is done.
We urge the administration to reconsider these tariffs and engage in meaningful discussions with Canada, Mexico and China to find solutions that protect both national security and economic prosperity. ALA will continue advocating for policies that support a stable, predictable trade environment and ensure that our industry remains strong and competitive. ALA will continue to keep members updated about the potential opportunity for waivers on lighting products and is working closely with our industry partners on communicating the need to roll back these tariffs immediately.
In a communication to showrooms, Innovations Lighting president Gregory Mazza wrote, “Let me be clear: Innovations Lighting is here for you. We are working tirelessly and creatively behind the scenes – in what I can only describe as daily ‘war room’ strategy sessions – with government contacts, financial advisors, and our internal executive team to chart the most stable and responsible course forward. What we are choosing to do right now is not to react, but to lead with patience, poise, and purpose.”
He added, “The current news around tariffs has undoubtedly stirred concern throughout our industry. We understand the questions you may have, the strain it could put on your business, and the anxiety it brings to planning ahead…We’ve taken the deliberate stance to pause – not out of hesitation or fear – but out of confidence that this moment will pass and resolve. Based on my ongoing conversations with highly informed individuals in government and finance, I believe there is a strong likelihood of resolution between China and the U.S. by June…Until then, our inventory is fortified, and we are not raising prices or inflating margins in anticipation of something that may never materialize.
“[The company will be acting] with transparency, respect, and care. That may include price adjustments or program changes – but not until we absolutely have no choice but to do so. Any decisions made in the future will be measured and communicated with the same clarity and consideration you’ve come to expect from us.
“You are not just our customer — you are part of the Innovations family. Our success is your success, and vice versa. We are making every effort – from tightening our own belts, absorbing what we can internally, and holding our ground – because we believe that responsible partnership means protecting each other in times like these.”
Tariff Impact on Design Services
The Q2 2025 Houzz U.S. Renovation Barometer indicates that 66% of design firms surveyed see tariffs will heavily impact input costs, with 53% anticipating supply chain disruptions and 50% predicting reduced client budgets. Businesses in the design sector anticipate tariffs to impact appliances (65%), cabinetry (58%), lighting fixtures (58%), indoor furniture (58%) and outdoor furniture (48%). Of the 67% of design firms that have a mitigation strategy in place, 48% of them are likely to pass increased costs on to their clients.
Tariff Impact on Home Building
For years, the National Association of Home Builders has been leading the fight against tariffs because of their detrimental effect on housing affordability. NAHB has taken several actions to roll back tariffs and to boost domestic production of softwood lumber.
On March 5, NAHB Chairman Buddy Hughes met with U.S. Trade Representative Jamieson Greer to discuss how tariffs on building materials will drive up the cost to construct homes and harm housing affordability. The day before, Hughes spoke on the same topic while testifying before the House Financial Services Subcommittee on Housing and Insurance regarding the need to increase America’s housing supply.
Tariffs on building materials act as a tax on American builders, home buyers and consumers. Builders estimate an average cost increase of $9,200 per home due to recent tariff actions, according to the March 2025 NAHB/Wells Fargo Housing Market Index.
Of course, the effects of the tariffs on the housing industry go far beyond Canadian lumber. For example, 70% of the imports of gypsum, which is used to make drywall, comes from Mexico. The U.S. also imports nearly $500 million worth of gas ranges from Mexico annually.
Costs will also rise for steel, aluminum, copper, home appliances and scores of other building materials sourced outside of the U.S. NAHB estimates that approximately 7.3% of all goods used in new residential construction originated from a foreign nation in 2024.
The tariffs are not only expected to raise the cost of building materials – which are up 34% since December 2020, far higher than the rate of inflation – but also wreak havoc on the building material supply chain. In turn, this will put even more upward price pressure on building materials.
Moving forward, NAHB will continue working with all relevant stakeholders to roll back tariffs on building materials, boost sawmill production and increase the domestic supply of timber from federally owned lands in an environmentally responsible manner to help fix building material supply chains and ease costs.
On April 8, NAHB posted this update on the tariff situation:
Current countervailing (anti-subsidy) and anti-dumping duties on Canadian lumber stand at 14.5%, but the Commerce Department conducts annual reviews on these rates and has released a preliminary determination to more than double this levy to 34.5%. The official determination should be released in the Federal Register this week, and a final review will be published in August or September. The higher rates will take effect then.
The countervailing and anti-dumping duties on Canadian lumber stem from a trade dispute with our northern neighbor that has been ongoing for decades. These duties are completely separate from the global reciprocal tariffs announced by President Trump last week. When the president made his announcement, NAHB scored an important win when Trump chose to continue current exemptions for Canadian and Mexican products, including a specific exemption for lumber from any new tariffs at this time.
It’s clear we are not out of the woods yet on the possibility that Canadian lumber tariffs could run even higher than 34.5% later this year. The White House issued an executive order in March commanding the Commerce Department to investigate the national security impacts of imports of timber and lumber.
NAHB filed a comment letter on March 31 with the Department of Commerce to argue that housing is a critical component of national security and that no further lumber tariffs should be imposed in the name of national security.
The worst outcome from the investigation is that the U.S. imposes an additional tariff on top of this 34% duty tentatively slated to go into effect this fall.
For now, Canadian lumber tariffs stand at 14.5%, but members should be forewarned to expect higher tariffs later this year and plan accordingly.
NAHB will continue to urge the White House to roll back tariffs on lumber and other building materials and remains focused on improving building material supply chains and easing costs for our members.
According to the Houzz U.S. Renovation Barometer, construction businesses are concerned about tariffs on cabinetry (66%), appliances (60%), plumbing fixtures (58%), lighting fixtures (53%) and windows (44%). Nearly 80% of construction business have a mitigation strategy in place; for 68% of those, the plan is to pass increased costs on to their clients.
Tariff Impact on Home Furnishings
Furnishings leader MillerKnoll will implement a 4.5% list price increase on June 2, it said in its third-quarter earnings call. The increase responds to higher steel tariffs already in place, as well as the newly-announced reciprocal tariffs. It’s also aimed at dealing with other inflationary pressures, the company said.
“In addition, we will partner with suppliers, leverage value engineering and available flexibility within our supply chain and manufacturing footprint to offset cost impacts wherever possible,” said CEO Andi Owen. “And we will also consider incremental price surcharges if necessary to manage this period of volatility.”
“It would be wrong to think that the price increase is squarely aimed as a response to tariffs,” said Jeff Stutz, CFO. “It’s in part that, but I would point out that even domestic U.S. steel prices have run up since the start of the calendar year, and it has been coincident with this tariff conversation. So it’s not just the potential cost implications of the tariffs. There are some derivative effects that seem to be having an impact on key input costs like steel, as well as other inflationary pressures.”
