At the end of April, the Coaticook South Shore Furniture plant halted production to concentrate on development of their products and become a distribution centre for their customers. This interruption has led to 39 layoffs out of the plant’s 90 employees and those that were let go are expected to leave their positions by the end of July. The standstill comes as a result of the plant’s excess production capacity.
“In our industry right now, inventories are very high and Asian suppliers are very aggressive. It was difficult to maintain a good level of production in the factories when consumers have less means,” said Martin Forest, vice president of manufacturing operations at South Shore Furniture. The cease of production occurred just after the furniture leader celebrated its 83rd anniversary this year. Going forward, the Coaticook plant will concentrate on the company’s production of specialized products that can be shipped to South Shore Furniture’s two other manufacturing plants.
South Shore Furniture’s Saint-Croix, Québec, plant is reorganizing certain roles and will shift the focus to mass manufacturing operations. The company’s plant in Mexico has been initiating layoffs since the fall of 2022, however, production is ongoing. The plant’s attempt to modernize its production and equipment has led to a significant rise in costs.
Layoffs Expected to Affect Employees and Executives
“We have two plants in Quebec and we have similar challenges in both,” noted Forest. The layoffs and production changes occurring at the various South Shore Furniture plants have placed continuous pressure on the brand’s investment choices. The expenses related to modernizing have been on an upswing in recent years and begin at two and three million dollars per piece of equipment. To ensure their investments remain profitable while the plants are struggling with overcapacity, South Shore Furniture is expected to modify its ways.
“They are very creative people who perform very well in complexity and innovation. For us, it was important to have a team dedicated to this,” said Forest on the “creative spirit and DNA” of the Coaticook plant’s team. South Shore Furniture will only retain 51 employees after July 31. The production adjustment has not only initiated layoffs, but has assigned employees to other roles. The layoffs, especially, will affect employees and executives alike.
“For the moment, we have very little information,” admits Marc-André Paré, national representative at Unifor. “In terms of unionized positions, I don’t know how many there will be. We have a meeting scheduled for next Monday to get more details. We are also negotiating an agreement at the moment, so that complicates things. We are going to draw up an action plan based on the specific changes, because at this time we do not yet know which positions will be affected.”