As tariff turbulence tests importers, Zuo charts steady course to High Point

HIGH POINT — At a time in the furniture industry when every week can seem another ride on a merry-go-round of new tariff announcements and new sources of uncertainty, one might assume that an importing supplier like Zuo Modern would have a serious case of motion sickness.

But it appears the full line resource is approaching High Point with steady footing.

CEO Luis Ruesga told sister publication Furniture Today that the company’s strong inventory position, resilient supply chain partnerships and robust warehousing operations have helped it navigate volatile business conditions. Those advantages, he said, allow Zuo to offer buyers a level of certainty that’s increasingly rare in the import-driven segment of the industry.

Steady as she goes

“We have decided not to be overly speedy or reactive with our decisions,” Ruesga said. “We try to be cautious and look at long-term changes. Back when tariffs were increased to a crazy high percentage for a day or two, I remember one of my competitors raised prices but had to take them back the next day.”

He added that Zuo’s prices are locked in for the remainder of the year.

“We are committed for the rest of this year not to have any price changes except reductions,” Ruesga said. “We’re giving that confidence to the customer, and if the tariffs increase on Nov. 1 to 100% on products from China, we will find a way to deal with it.”

An unintended side effect of this year’s soft consumer demand has been a healthier-than-usual inventory position heading into next week’s High Point Market. “My inventory level, and I think it’s because of the current state of the economy, is probably a little bit on the higher side,” he said. “I have healthy inventory and good cash flow.”

Sourcing strength

Despite the challenges of a shifting trade environment, product development remains a priority for Zuo. Ruesga said the company has made significant strides in diversifying its sourcing strategy.

“Right now, the majority of my product development focuses on sourcing outside of China,” he noted.

“Whatever happens, we have to start the process of development, sampling and final stages with enough time to make changes,” he said. “Yes, it’s difficult to plan due to the tariffs, but the main questions we ask are: What is the country good at producing, and can we sell it to our retailers and hospitality clients?”

This focus on reliability and proactive development, Ruesga said, has opened doors with new accounts.

“Consumer shopping habits are playing right into our hands right now,” he said. “It’s just a reflection of the economy on the retail side, and we’re starting to see this more on the hospitality side as well. Zuo had previously never been able to sell to Ritz Carlton. Right now, we have two big projects, and I think it’s because of their budget.”

Ruesga emphasized that new product remains a critical differentiator for retailers looking to refresh their floors amid shifting demand.

“My buyers are desperate to bring something new to the table because the numbers and the reality on retail floors are often not the same,” he said. “Obviously, tariffs will increase the final retail price, but at the end of the day, people have to want your product. Retailers need to bring the excitement to the store to draw customers and build brand loyalty.”

Even if demand is soft and economic conditions appear cloudy, Ruesga reiterated that people are still buying furniture. The trick to supplier success in High Point, he believes, is to offer retailers and designers well-priced product that meets the moment.

Tomas Kauer - Moderator https://www.tomaskauer.com/