A worker sands the arm of an Adirondack chair at a factory in Kemptville, Ont. approximately 50km south of Ottawa, on Thursday, Sept. 3, 2026. THE CANADIAN PRESS/Adrian Wyld

By The Canadian Press

Tariffs have some mom-and-pop manufacturers considering move to United States

Sep 4, 2026 | 1:00 AM

An Ontario-based Muskoka chair maker hit hard by U.S. tariffs is considering moving the bulk of its manufacturing to the United States, while keeping chairs for the domestic market made in Canada.

DFC Woodworks Inc. has been making outdoor wooden patio furniture including Muskoka chairs — also called Adirondack chairs — since 1955.

The Kemptville, Ont., company exports about 70 per cent of its furniture to the United States, but those goods are now subject to a steep 50 per cent U.S. duty.

The family-run business is now saddled with a hefty tariff bill and a looming decision about whether to keep absorbing the costs, raise prices and risk U.S. sales falling to zero, or move the majority of its manufacturing south of the border, DFC Woodworks president François Bruneau said in an interview.

“It’s damned if we do, damned if we don’t,” he said. “If we raise prices, it will make us non-competitive and sales will go down. If we don’t, the tariffs will sink us.”

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The Muskoka chair maker’s dilemma illustrates the challenges facing many Canadian small- and medium-sized enterprises, said Fen Hampson, international affairs professor at Carleton University.

“There are lots of small mom-and-pop operations, very small businesses, and they are highly dependent on the U.S. market,” Hampson said. “If a large portion of their production is exported to the U.S., a big tariff could put them out of business.”

Smaller manufacturers may lack the financial resources, diversified markets and specialized trade expertise that allow larger corporations to weather a trade war, he said.

DFC Woodworks, which operates under brand names The Best Adirondack Chair Co. and The Best Muskoka Chair Co., makes all its outdoor patio furniture — including swings, bar sets, dining tables and rocking chairs — in Ontario using B.C. western red cedar and eastern select pine.

It’s now reluctantly contemplating downsizing its Canadian operation and moving manufacturing for its U.S. customers to the southeastern United States.

“It’s a difficult decision,” Bruneau said. “We did some preliminary explorations in North Carolina.”

He adds: “It’s not something we take lightly. It’s just the economics are difficult and getting worse.”

Tariffs on the company’s furniture exports to the U.S. will cost DFC Woodworks about $75,000 on existing orders over the next eight weeks — costs that Bruneau said he cannot pass on to customers.

Dennis Darby, chief executive of Canadian Manufacturers and Exporters, said the latest tariffs pose a distinct challenge for Canadian exporters because they apply exclusively to goods from Canada.

“It might be harder than you think to pass on that tariff because somebody can undercut you from another country,” he said.

“It actually makes it easier for countries like China to sell their goods into the U.S. because the Canadian goods are being tariffed at 50 per cent.”

Moreover, a long history of free trade between Canada and the United States has led many Canadian manufacturers to ship goods directly to U.S. customers, Darby said.

That has become a problem because when a Canadian company is the importer of record under an existing shipping arrangement with a U.S. customer, it must pay the tariff to U.S. customs before the goods are released, he said.

Tariffs also tend to be harder for smaller exporters to absorb because they often lack the negotiating clout to persuade U.S. customers to share the tariff cost or the market power to raise prices, Darby said.

It leaves smaller companies that are dependent on U.S. sales with few options, he said.

A June survey by the trade organization found that if tariffs persisted above competitive thresholds, about 43 per cent of manufacturers would be forced to shift production, investment or sourcing to the United States.

“It’s very hard to make up 50, 60, 70 per cent of your demand domestically,” Darby said.

DFC Woodworks vice-president Dina Elatawi, who is married to Bruneau, said the buy Canadian movement has boosted the company’s domestic sales over the last two years.

“It’s helped us stay abreast,” she said. “We’re so happy that Canadians are supporting us and rallying behind us.”

However, the federal government could do more to support small businesses, Elatawi said.

“The financial compensations that they’re doing for businesses to help us through this hard time, none of them really relate to us because we’re either too small or we don’t have the money to match dollar for dollar,” she said. “We’re really in a pickle.”

DFC Woodworks has diversified in recent years, growing sales to Europe with plans to export to Japan, Elatawi said.

“We are trying to diversify,” she said. “But the United States is our biggest market.”

Moving manufacturing for U.S. sales to North Carolina would require sourcing wood from Oregon and Washington, Bruneau said.

While furniture sold to Canadian customers would continue to be manufactured in Ontario using Canadian wood, the change would mean downsizing the Kemptville operation.

“It would definitely have a devastating effect for the Canadian side here, since the majority of our manufacturing is for U.S. sales,” Elatawi said. “We might have to do some layoffs and have a smaller shop.”

She added: “We’ve never in our lives ever, ever contemplated that this could happen. I feel so sad.”

This report by The Canadian Press was first published Sept. 4, 2026.

Brett Bundale, The Canadian Press

by The Canadian Press