Part 4/13:
The core issue stems from the intensifying US trade war, especially the reintroduction and escalation of tariffs on Canadian softwood lumber and furniture. As of midnight, the US implemented a 45% tariff on softwood, with a 25% tax on furniture like kitchen cabinets and vanities—a rate set to double in January to 50%. These tariffs have made Canadian wood more expensive relative to other global competitors, with Canadian softwood now taxed at a higher rate than Russia, formerly one of Canada's key competitors.
Nearly all of Wholesag’s customer base (an estimated 80%) was American, making the company highly vulnerable to these trade disruptions. The tariffs have dramatically shrunk profit margins, rendering operations in Lindsay economically unfeasible.