The specter of US tariffs has brought on a Montreal-based girls’s clothes maker to position greater than a 3rd of its employees on depart.
SRTX is placing 40 % of its 350 staff and contractors on short-term layoff, Chief government officer Katherine Homuth stated in a press release. The corporate has 85 % of its gross sales within the US and has invested “tens of hundreds of thousands” in Canadian factories, she stated.
The corporate’s merchandise already face a 16 % obligation to ship to the US beneath North American commerce guidelines as a result of a few of its uncooked supplies are sourced exterior the continent, she stated in a social media submit. Including 25 % US tariffs, as President Donald Trump has threatened to do, would deliver that to 41 %.
The Trump administration would deal the corporate an additional blow if it follows via with eradicating an exemption that had allowed low-value packages to be shipped duty-free to US customers.
“We’re in a worst-case state of affairs,” Homuth stated, including that the corporate has suffered delays in closing a fundraising spherical.
“This places immense stress on our enterprise mannequin, particularly as an organization that has invested closely in built-in manufacturing in Canada.”
SRTX, based in 2017 with the backing of Y Combinator, is thought for making resilient pantyhose known as Sheertex. It has raised over $200 million in capital from buyers together with Sweden’s Hennes & Mauritz AB, Investissement Quebec and the Canadian authorities’s export improvement company, in line with an organization presentation.
Homuth lamented the “fragile state of home manufacturing in Canada” in her assertion.
“Canadian manufacturers that depend on abroad manufacturing can pivot shortly, shifting suppliers or logistics suppliers to work across the tariff construction with relative ease. However for corporations like ours, who’re constructing from the bottom up right here at house, the stakes are a lot increased,” she stated.
The makers of the “Canada is Not for Sale” hat popularised by Ontario Premier Doug Ford discovered this as nicely, as they struggled to search out corporations that will manufacture the hats within the nation, the Canadian Press reported in January.
The Canadian Chamber of Commerce known as for the federal government to reconvene the Home of Commons to answer commerce tensions. Parliament has been suspended since early January, when Prime Minister Justin Trudeau introduced his resignation, triggering a race to interchange him.
“We have to ship a powerful message to President Trump and the world that we are going to rise to this event, as a unified Canada. Tariffs tomorrow as a substitute of tariffs in the present day nonetheless depart companies, employees and households within the lurch,” Candace Laing, CEO of the chamber, stated in a press release.
By Melissa Shin
Be taught extra:
Trump’s Tariffs, Defined in 4 Charts
Uncertainty across the rollout of the tariffs — how lengthy they’ll final and whether or not extra are within the works — complicates the style trade’s capability to regulate to the brand new actuality.
