Odd Lots - What an Alaskan Furniture Company Tells Us About Tariffs

Episode Date: August 11, 2025

Alaska is no stranger to supply chain issues and a higher cost of living. Almost everything has to be imported into the state, incurring longer lead times and extra transportation costs — and that’s even before adding in the new tariffs from the Trump administration. In this episode, we speak with Dave Cavitt, the founder and CEO of Furniture Enterprises of Alaska, which owns furniture stores for brands including La-Z-Boy, Mattress Firm, Ashley’s Furniture, and many more. We talk to him about the logistical challenges of selling furniture in Alaska, consumer demand right now, the impact of the tariffs, and much more. Read more:Who Loses the Most From Trump’s Tariffs? Who Wins?US, Japan Working to Announce Reciprocal Tariffs Won’t Stack Only http://Bloomberg.com subscribers can get the Odd Lots newsletter in their inbox each week, plus unlimited access to the site and app. Subscribe at  bloomberg.com/subscriptions/oddlotsSee omnystudio.com/listener for privacy information.

Thanks for listening to Odd Lots. Follow the show on Amazon Music for more future episodes or just ask, Alexa, play the Odd Lots podcast on Amazon Music. Today's show is brought to you by Vanguard. To all the financial advisors listening, let's talk bonds for a minute. Capturing value and fixed income is not easy. Bond markets are massive, murky, and let's be real. Lots of firms throw a couple flashy funds your way and call it a day. But on Vanguard, at Vanguard, institutional quality isn't a tagline. It's a big line. It's a very big. It's a few. It's a few. commitment to your clients. We're talking top-grade products across the board of over 80 bond funds, actively managed by a 200-person global squad of sector specialists, analysts, and traders. These folks live and breathe fixed income. So if you're looking to give your clients consistent results year in and year out, go see the record for yourself at vanguard.com

slash audio. That's vanguard.com slash audio. All investing is subject to risk vanguard marketing Corporation distributor. Thinking about buying the right home, but not sure when. What if you had the right design, the right lot and finishes at the right price? Not someday, but right now. Register at Democrat Homes.com and get everything you want right now. Bloomberg Audio Studios, Podcasts, Radio News. Hello and welcome to another episode of the Odd Lots Podcast. I'm Tracy Allaway. And I'm Joe Wisenthal. Joe, can I start this conversation with what will seem like a random story, but I swear I have a point. Go on. Okay, so a long, long time ago when I was visiting my mother in Beijing one winter, she was working out there.

Beijing winters are really cold. They're really dry. And I was sat in her apartment and all of a sudden I hear this giant crack and I run downstairs. And it turns out the console that the TV was on had just like completely split in half because the air was so dry. Whoa. And it was so freaking cold. Wow. And I never considered that you could have weather locations where the weather was so extreme that you actually had to factor that into your furniture.

I mean, I do have one sort of connection to that, which is we're going to start bragging about our international experiences, et cetera. You know, I mentioned my family lived in Malaysia for a year. We bought this big roundtable that we brought back with us to Illinois. And I do remember now that there was some discussion about like, oh, this was designed for the humidity of. of Malaysia, et cetera, maybe have some natural give, et cetera, but it's fine. But it's funny you say that because, yes, now I would not have remembered that otherwise. All right. Well, the reason I bring it out... We're so sophisticated in international, aren't we? So sophisticated. I hope everyone's factoring in climate considerations into their furniture. But there is actually a reason that I'm bringing that

up, which is we are in Alaska. And Alaska does have cold, very, very dry winters. And it's also very, very large. It's very hard to get things into and out of... of the state. Yeah. And so I think it would be really interesting if we actually talked about the furniture industry within Alaska. We need no more introduction. We need no more.

Let's do it. All right. So we do in fact have the perfect guest. We're going to be speaking with Dave Cavett. He is the CEO and founder of Furniture Enterprises of Alaska. So really the perfect person to speak to. Dave, thank you so much for coming on all thoughts. Thank you so much for having me here.

So tell us about Furniture Enterprises of Alaska. What exactly are you doing there? We are furniture retailers. We have 14 stores under six different brand names. And so we have our stores, our Sathers Furniture, Williams and K. Home Furnishings, which is more design and custom order products. Souther's mid-market. We have two Ashley stores that are a licensee of them.

We have three mattress firm stores, a lazy boy store, and an ultimate mattress. store, which is a higher-end mattress retailer. So what we do is we segment the different demographics in the marketplace and then combine the operations back behind it to be able to deliver the furniture at a lower cost than other companies. And tell us a little bit about, you mentioned the size of the retail footprint. Tell us a little bit about the history. How did you get into this? Are you a native Alaskan? We learned the term sourdough recently. Are you, are you, a sourdough. What's the story of you in your company? Yes, I am a sourdough now. I am 69 years old. I grew up in Central California in the farming area, and it was not the right fit for me.

So two weeks out of high school, I hitchhiked up here, kind of thing by myself. Amazing. All right. I did several different odd jobs. A short term as a commercial fisherman, but we sunk the boat. That was not good. I was a janitor in bed. bedmaker on the North Slope during the building of the pipeline, and then I went as a day labor to a furniture company and stayed there ever since. This is already really fascinating. So one thing that Joe and I are learning about Alaska in real time is it is incredibly cyclical and sort of you have these boom-bust cycles that are tied to what's happening in the oil industry. So you mentioned making beds when the pipeline was getting constructed.

Is it fair to say that furniture sales follow that boom-bust cycle as well? when there's a lot of activity, lots of people moving to Alaska and building stuff, do you suddenly see demand for furniture ramp up? And then when it kind of goes bust, do people start selling their, I don't know, their beds on the corner? Yes, we definitely have our cycles. They're not as extreme as that they once were. The largest of those booms and bust was the building of the pipeline. And then the first years of the oil revenue for the state that came in and then the state built a lot of infrastructure, and those were booming times, and there would be whole subdivisions

built on spec, and that type of thing as it was growing, and then the oil prices dropped to around $8 a barrel, and the construction stopped, and the people moved out of the state. So back in the mid-1980s, Alaskans knew all the terms of your house being underwater, and people mailing their keys back to the bank and that kind of thing. And about a third of the homes in Anchorage at that time were walking. out on vacated by the owners. So that was worst of the bust. How did the furniture, how did you, at that point, had you already started your furniture operations? Like, where were you in your career at that point? Yes, I was then a half owner of the furniture company that I'd gone to

work for and it was just terrible. I mean, revenues dropped like 70% type of things. We had 14 banks and savings and loans at that time and half of them were closed by the FDIC or that whatever the savings and loan one is called again at that time. And so we ended up having to do workouts with the banks and the FDIC and people along that line. Sorry, before I forget, were you really on a commercial whaling? Oh, sorry. Were you written? Listeners? Listeners need no further context. Does everyone know that Joe is obsessed with Moby Dick and whaling at this point? To the point where you accidentally introduce it into sentences? You're on a commercial fishing boat. Did it really?

crash and were there any sort of did that you know when is there lessons from business that you could take from the allegory of going down on a ship yeah i think it would be to uh it didn't go down uh with us on on it it did go down and i think it would be to uh interview the uh person leading that uh i was um i just got up to alaska i met another fellow who was the same age i was but uh we They were both just turned 18, but he had a fishing boat and said that I could work on it. He wouldn't pay me, but I'd get experience. And we went out, and he ended up not knowing what he was doing. And we got caught into a storm, heavy seas, and that boat took on a lot of water,

and the engines died, and we were hailing a Mayday out in the Gulf of Alaska. And luckily, another ship, a tanker heard it, and said, do you want us to call the Codiac Coast Guard for you? We said absolutely because we are sinking. And they came back and said, boys, we've got bad news for you. It's too rough. They're not coming. And they came out and got you? That tanker did. Yeah. The Coast Guard, it was too rough. Coast Guard couldn't. Yeah, couldn't do it. And so they came out. And it took us a little while of the boats bumping together. They were 550 feet long. We were 42 feet. And it slapped together at one time. and they'd hung a ladder off the edge of that boat,

and I saw that, and I scrambled up to the... Must have been the satisfied ladder you've seen in your whole life. Absolutely. We thought we were... We thought we were goners, you know, because the only last half an hour in that cold water, so... Okay, so no more fishing. From fishing to furniture.

Yep. What should people know about furniture sales in Alaska? What are the special considerations versus, say, furniture sales in the lower 48? Yeah, the biggest thing that's... separates us from the lower 48 is the additional freight cost to Alaska. You know, we're a long ways by road. We only have the one road, the Alaska Highway, which goes through Canada and up to us, and only heavy equipment really gets shipped over that. Everything else is shipped to the port of

Seattle and then put onto ships, and it takes three days for those shipments to arrive to us. And we pay more for that freight from Seattle to Anchorage than we do from the containers that we bring in from China, Vietnam, Malaysia in those areas. Yeah. So explain that more intra-U.S. shipments are costlier than trans-Pacific shipments? Yes. I just checked because I figured it might come up. We're paying currently $1,900, China to Seattle. Then we have to reload that onto a carrier. that can bring it up to here.

And it's about $9,000 from Seattle to here. Wow. Is there a Jones Act? Sorry, I have to, is there a Jones Act angle of this story? Jones Act is a part of that for sure. Jones Act everywhere. Can you not get shipments direct from China? Could that happen?

No. There is nowhere near the volume out of the Anchorage area and where the port goes. There's maybe 650,000 people. We have about $760 in the state, I think. And so we just don't have just no economies. So I have to imagine that one of the keys to running a successful furniture business in Alaska is you have to be really, really good at shipping and logistics.

And to some extent, it sounds like you're basically running a distribution center for furniture, right? Is that the thing that you're sort of competing on? Or is that the area of expertise that you really have to have in order to be successful in this business? I would say yes. We are good at the merchandising. We're good at the market segmentation, the advertising. We're good at everything, but we excel in logistics. We have a full-time person. We're not that big a company, but a full-time person that puts together those and is always negotiating the rates and trying to make sure that every container is filled to the maximum that can be. We can't pay for dead airspace and containers. What was 2021 like? So, you know, we as a podcast first started getting really interested in, you know, shipping and logistics and freight is very important because like everyone else, we didn't think about it much in the 2010s when there was plenty of excess capacity. And then what was 2021 and 2022 like during those sort of extreme levels of both inflation and, you know, just bottlenecks in the supply chance? You know, those were trying times for us. But at least every. but he was in that same boat, kind of saying. And we had to put out our orders where we usually try to put them out a few months in advance.

We were having to put them out up to eight to ten months in advance. And, of course, the freight rates were coming in. We had been paying about $1,700 a container trans-specific before that. And I think our peak was around $22,000 for a container. Wow. But the demand was there. You know, and during that time, it was the biggest boom for the furniture industry that's ever been because as people in COVID times could not go to the bars and the restaurants, they weren't traveling,

and they decided to take that money that they usually spend other places and put it into furniture. And so we had to pass on those costs to the consumers, of course, but it happened and it worked. At times like that, how does it work in terms of getting inventory? Because I imagine it's not just Alaskan residents that want a whole bunch of new furniture because they're stuck inside and everyone feels like redecorating their house at that particular moment in time. People in the lower 48 are doing the exact same thing. It's probably not enough furniture stock to go around at that particular moment. How are you actually placing orders? And I guess how does it work in general when you're buying inventory from big brands like a lazy boy or like a mattress firm?

Right. That's really two different things. One, if we're talking about during the COVID times, we had to align ourselves and ensure that the people that we're placing the orders with would actually ship them. And we put a lot of focus into that. We did narrow down our selection to people that could get it shipped to us finally, even though there was rolling delays on that at all times. And then along with the manufacturing delays, then they would go and put the containers into the Vietnam. China ports, and you couldn't get the bookings on the shipping. Right. That was overburden type of thing. But it's different now. It's back closer to how it has been in the past. And we go to the furniture markets. We go to four of them a year, and we select the items.

And then when we bring something into our showrooms, we start the backup process and ordering and what we think demand is going to be. We do keep those items on our showroom. rooms and then we sell our backstock and we sell into incoming stock. So we're keeping a close hand on when the arrival dates are going to be so that our sales staff can say, this is out of stock right now. It's coming in in three weeks and we can even book a delivery date from that point. I didn't realize there are furniture markets, but I guess that makes sense. So the ideas these are big like wholesale furniture markets where you have the wholesalers sort of unveiling what

they might have available to the retailers every year? Yes, there's two in High Point, North Carolina, and then two in Las Vegas that we attend. The ones in High Point, where you should find out a little bit about it. Yeah, we should. It is just a massive market that's tens of millions of squire fee manufacturers displaying the new products. Today's show is brought to you by Vanguard. To all the financial advisors listening, let's talk bonds for a minute. Capturing value and fixed income is not easy. Bond markets are massive, murky, and let's be real. Lots of firms throw a couple flashy funds your way and call it a day.

But not Vanguard. At Vanguard, institutional quality isn't a tagline. It's a commitment to your clients. We're talking top-grade products across the board of over 80 bond funds, actively managed by a 200-person global squad of sector specialists, analysts, analysts, and traders. These folks live and breathe fixed income. So if you're looking to give your clients consistent results,

year in and year out, go see the record for yourself at vanguard.com slash audio. That's vanguard.com slash audio. All investing in subject to risk Vanguard Marketing Corporation distributor. They say abs are made in the kitchen. Cool, but who has time for three hours of meal prep and a fridge full of Tupperware? That's why I started using Factor. Factor delivers fresh, never frozen, ready to eat meals that are dietitian designed for balanced science-back nutrition.

No prep, no cleanup. Just heat, eat, and move on. I've got gym days, work days, super long days, and Factor keeps me on track without slowing me down. It's real food, great flavor, and the kind of meals that actually support the work I'm putting in. We're talking chicken pesto, steak with veggies, roasted salmon, meals that feel like they were cooked for you, not by you. So, yeah, abs might be made in the kitchen. But thanks to Factor, I don't have to be in the kitchen. Right now, get 11 meals, free shipping, and free sides for life.

Hurry, this offer won't last long. Go to factormeals.ca and use code pro. That's 11 meals, free shipping, and free size for life, but only with the code pro at factormeals.ca. Factor, Canada's number one ready-to-eat meal delivery service. Thinking about buying the right home, but not sure when? What if you had the right design, the right lot, and finishes at the right price? Not someday, but right now.

Register at democrathomes.com and get everything you want right now. The news doesn't stop on the weekends. Context changes constantly. And now Bloomberg is the place to stay on top of it all. Hi, I'm David Gurra. Join us every Saturday and Sunday for the new Bloomberg this weekend. I'm Christina Rafini. We'll bring you the latest headlines, in-depth analysis, and big interviews.

All the stories that hit home on your days off. And I'm Lisa Mateo. Watch and listen to Bloomberg this weekend for thoughtful, enlightening conversations about business, lifestyle, people, and culture. On Saturday mornings. we put the past week's events into context, examining what happened in the markets and the world. Then on Sundays we speak with journalists, columnists, and key political figures to prepare you for the week ahead.

Join us as soon as you wake up and bring us with you wherever your weekend plans take you. Watch us on Bloomberg Television. Listen on Bloomberg Radio, stream the show live on the Bloomberg business app, or listen to the podcast. That's Bloomberg this weekend. Saturdays and Sundays starting at 7 a.m. Eastern. Make us part of your weekend routine on Bloomberg.

Bloomberg Television, Radio, and wherever you get your podcasts. I want to talk about the contemporary economy a little bit. One angle that strikes me is very furniture relevant as housing. And due to interest rates, there's a lot of perceived stagnation. I mean, there is a lot of stagnation in the housing industry. In general, a lot of people aren't moving due to mortgage lock-in. There's not a lot of new construction happening right now due to financing costs. What are you seeing?

Like, I don't know much about the election. housing market. But, you know, what are you seeing in the Alaska housing market right now? And I have to imagine whatever is happening feeds into the impulse to buy new furniture or not. Yeah. Unfortunately, in 2015, Alaska, the oil prices took a dip. And when that went down, then the oil companies laid off their people and a lot of them. And since then, we've not recovered. So we're now in the 10 years of a recession, in my opinion. Home building and Anchorage has been very slight. Only a 25 to 50 homes a year been built in the past decade. And so each one of those is an opportunity for us to furnish, but it's been pretty slow. We've had a decrease in our population from about

$305,000 to about $285,000, maybe somewhere in that right now. Home building in the rest of the state It has been slow. The only place that is happening is in the Matanuska Valley, which is about 35 miles outside of Anchorage. Land is less expensive there. There's less municipal regulation and that kind of thing. So they're building a several hundred homes out there a year, and that's our hot spot right now. Talk more about that. So when you see a particular area of Alaska booming or when you hear that, I don't know, there's going to be, you know, some new oil project built in one particular town or city, do you immediately start? thinking like, well, maybe we need to open a store over there. Do you sort of direct your business to where that oil money is going? No. It's a good question, but no. Where the oil is developed is on the north slope of Alaska, and there is no town there. It is just the oil camps. The closest to that are some native villages like Barrow, which is now called Upi Avaic. And there's another native village up there, but those are a few hundred people kind of thing, so no market.

All the infrastructure is through the Anchorage area. Talk to us about tariffs. What substantively are you seeing on that front? Tariffs are troubling to me. I lean as a conservative. I'm not really, I'm not a Democrat nor a Republican. I'm a independent, nonpartisan kind of thing. it's troubling because we buy product from China,

but now there's all the tariffs that are happening there that can price out that product to the marketplace. Today, I heard that India is doubling from 25 to a 50 percent, and we have now switched over, just had recently switched over some of our imports to India. And I was looking at those yesterday and thinking, oh, those are a couple of good bedroom sets. So planning must be rude.

I mean, setting aside cost and we'll get to cost, just the idea of like any sort of forward planning. It's brutal right now. You know, if you're the size of a Walmart or, you know, these Home Depot or something, you can probably get the manufacturers to guarantee you prices. We are way under that level, and we just have to take what they are going to add on to it. But they're into lack of confidence and how things are working out themselves. They're skittish. And so some of them are the manufacturing.

manufacturers won't ship if they think that there's going to be a sharp increase in the tariffs because they don't want to ship and then have the people they're shipping to say, not pay it. Not pay it. Yeah. Oh, interesting. Yeah. And what about just in terms of the added price from the tariffs?

At the moment, are you planning to absorb most of that yourself or do you pass it on to customers in a state where, you know, costs are already pretty high just because it's so remote and everything has to be shipped in? Right. We're having to look at those. And some of them we go hard back onto the manufacturer saying they're going to have to take on a lot of that. And they did originally just absorb portions of that and then started adding some back to the cost. And then we're absorbing some.

In like retail, we're taking the markups where we can. But in some of it, it's too price sensitive. And we're just having to eat that for right now. And it's too volatile. Yeah. I think I told you, Joe, but I went to. There's like a local British import shop in, I think it was in Vermont recently. And so they import everything from the UK.

It's like come here to get British candy and British groceries. And they basically just stopped publishing their prices because the tariffs were changing on an almost daily basis. And they were like, you know what, it's too much trouble to try to update all our pricing to take this into account. So we're just like not putting them on. Yeah. Say more about because this is from the perspective of the Fed. I mean, this is the trillion-dollar question about the degree to which tariffs can be passed on to the consumer or not, et cetera. And I'm just curious, like, how you think about, like, pricing in general and how you sense when there's an opportunity to push price a little bit more, have the customer defraise some of those costs or not.

Like, talk just a little bit about what you're seeing on that front. Our pricing, even though we're pretty remote and everything like that, goes back to national pricing. and if we get too high in our pricing, then consumers will shop in the lower 48 and pay that additional shipping up to here themselves. So that's always something we always have to make sure that we're negating that difference. Yeah. Do you sense just in terms of like the economic cycle right now, like setting aside tariffs, how does end demand feel among consumers in August 2025 than it would have been in August 24? Is there any slowdown in any of the segments that you perceive?

Are there some segments that are more robust than others? Yeah, it's softer right now, and a large portion of that softness, I do believe, goes back to consumer confidence. And whenever the consumer confidence wanes, then they push off deferable large-ticket purchases. And we see that right now. Well, one of the reasons we wanted to talk to you is because you have furniture brands that cover a sort of spectrum of consumers. So you have higher end versus maybe more budget items.

Do you see segmentation and consumer demand between, you know, maybe people who are buying slightly more modest furniture versus the people who are buying more higher end or custom? Yes. Right now and with my knowledge of the furniture industry nationwide is that, of course, the higher end is more insulated from that. And when it gets down to the starting price points that we have, for people that say that our apartment, you know, dwellers, renters and stuff like that instead of homeowners. And with the inflation, taking a bite out of their incomes, that's where we're

seeing it hit us the hardest. What are you seeing on the labor supply, particularly I imagine like movers or people who deliver the furniture or either retail workers and the showrooms, etc. How easy is it to hire right now? Not easy at all. It's a little bit better now than it was a couple years ago, but it is very difficult. Why? What's the, what's the constraint? Well, it's, there's more jobs available than people. What are the sectors that are like, where are they, when you look at like, okay, there's some prospective employer, they can choose to work between you and someone else, and you're competing with some other employer. What are these sources of employment demand that you're competing with here in Alaska? With us, you know, we're a very non-skilled labor force,

and so we bring in the people pre-pandemic. We were starting people at about $15 an hour for any position, and now we're at $21 to $25 an hour type of thing, and they come into us unskilled, and then we have to build the skills with them type of thing. So we're not looking for people with degrees and education and that kind of thing, just work for us. And again, if they don't like being retail, we need to work weekends. If they don't want to work a weekend, they can find another job someplace else.

Since Joe brought up constraints on labor, I'm going to ask what's becoming, I guess, a classic question in a lot of these episodes. But what would you say is the biggest constraint on your own business, whether it's finding enough workers, whether it's sourcing enough furniture, whether it's shipping costs, maybe it's regulation that's, you know, limiting the amount of homes that can actually be built around Anchorage. What's the biggest one for you? The biggest one for us is the decine that we've had in the population. and it is now rebounding from that, but it's going to be slow, or it is slow. And so it's just the size of the marketplace. We have stores in Anchorage, Fairbanks, the Kenyneye Peninsula, and the Matneska Valley. And in between that, it's about 550,000 people in our total market that can drive to one of our stores.

We do sell some to the people of what we call the Bush communities, where we sell it to them, but we have to load it into airplanes and that type of thing and it has to be flown out to them type of thing. So it is just the population. Is there a rate sensitivity aspect of your business either towards your own cost of capital or I have to imagine some of the buying is borrowed or the consumer is borrowing money to buy the bed, et cetera? Do you see any sort of clear link between high interest rates right now and how your business operates? The amount of consumers that are financing the purchase that we do do like the, we have that available for them. And then we run the promotions where we do 36 months up to 60 months without interest that we pay for that

interest up front to the finance company. But that is still, that is slowed way down over the peak that it was pre-pandemic. As people are just not, they're concerned about getting into too much debt. How much of the slowdown in customer demand And post-pandemic, how much of that has to do with just people bought a lot of stuff in 21, 22, and maybe you don't need, you know, another new bed for a while or another new coffee table or something like that, versus actually we are seeing a sort of fundamental structural slowdown in the amount of stuff that people are able to buy? Yes, I am not smart enough to understand that during the pandemic, what we did was made up for past purchases that they didn't make.

or if they bought into the future, I really don't know the difference in maybe a few years from now, some smart people will write something. I'll read it and say, oh, yeah, that's it kind of thing. But it had to do it. Now, furniture, when you buy it, like a dining room table, most people are expecting to get 20, 25 years out of it, unless it splits from too much moisture left in the wood kind of thing. But furniture does last five to 25 years. So it's a very slow cycle.

What would you tell your 18-year-old self about life in Alaska and doing business and a career in Alaska that is maybe the most surprising or most interesting or the most important lesson for that trajectory you've had? All right. So being kind of personal when I was a teenager and stuff, I had no self-confidence, that type of thing. I didn't do well in school. I didn't understand why, but I have some learning disabilities and that type of thing. I got up here, thought I'd be a laborer, that kind of stuff. So then, anyway, got into the furniture business turned out to be pretty good at it, and I run a good business. There still is the economies come and go to Alaska and that kind of stuff.

But the basic of the state has never lost its luster for me. I love living here. I love the mountains. I love the animals. I mean, we have hundreds of bear and thousands of moose that live within the city of Anchorage, and you see them and that kind of thing. I still get all excited about that. walking down the street while I'm telling you that can happen. More in the wintertime than the summertime, but in the wintertime, yeah, you got

a break and let them go through, walk through midtown, and they're big animals too. Anyway, good times, bad times, I'm staying here. Have you ever had a furniture delivery disrupted by wild animals? Not that I can think of. All right. Well-behaved moose, then. I have just one more question, I think, which is the other thing that I think maybe unusual about Alaska is, again, because it's so remote, because it's quite difficult in some respects

to get new materials, new items here. I imagine there must be a lot of competition from the used market. So if you have a bed, you know, a bed's not a great example. If you have a couch or a coffee table and you want to buy something new, you're not just going to throw that coffee table away. You're probably going to try to sell it on Facebook Marketplace or something like that. Do you feel a lot of competition from the used furniture segment? It's not that much competition for us, except for it, it is there, and it is the Facebook marketplace is where it is. So probably some of these items get bought and sold a few times, but again, that's usually

for younger people just getting started and or a temporary. They're just going to get something to, you know, last maybe six months to a year and then buy better quality furniture once they're established. So, yes, it is. there, it's off our radar for the most part. All right, well, Dave, thank you so much for coming on all thoughts. That was really fun. Thank you so much too.

Joe, imagine hitchhiking to Alaska to become a commercial fisherman and then get into the furniture business. Imagine getting into the commercial fisherman business, finding someone roughly your age and experience. You know, it's hard not to be either the mind comes to Ishmael and Kleequang from the 1851 by Herman Melville movie Dick, and then your boat crashing and then saving your life, et cetera. That's where your mind goes to. It's hard not for the mind to drift there.

Can I ask, if we go on a whale watching tour, am I just going to hear like Captain Ahab references for three hours? I'm just going to go around to everyone on the boat. I'm going to say, are you the Ahab, the Ishmael, or the Starboat? And I'm just going to ask, and I'm going to categorize everyone on the boat. But no, that was a great, like, he was a great Alaskan character. A great Alaskan character. And also, I still think the furniture industry is such an interesting one to kind of look at the economy. Yeah, yeah, totally.

It's an interesting lens to look at the economy through. And there were a couple things that I would pick out of that conversation. So one, just on the tariffs. Yeah. There's a theme that we've heard over and over again, which is the big guys probably have the pricing power and the relationship power in order to get a lot of their manufacturers to try to absorb some of the tariff costs. in a way that the smaller guys do not have. Well, and to this point, it's really interesting that the manufacturers themselves won't accept certain orders because they're not confident that the economics will make sense at the end and that the customer will just walk away from it,

which is just a really interesting dynamic. You could just imagine it's like, no, I swear I'll pay, right? I swear I'm going to pay, I'm good for it. And that adds another. And then this gets to like the idea of not just tariff level, but tariff volatility. just like you wake up one day and the tariffs double in India and then you're like rethink your planning. Exactly.

And I suspect, you know, like the longer the tariff uncertainty persists, like the more behavior like that you're going to see where people are just like, I don't know if we want to strike this contract at all. There's like two levels here, right? Because tariffs mechanically raise the cost of doing business. But then on a more sort of abstract level, it's just business gets more costly in this environment. And you know, you always hear, oh, people hate uncertainty, et cetera.

And sometimes there's just this cliche that people say. because whatever. But here it's like extremely, extremely concrete. The other thing that was really interesting to me, and again, this is a sort of broad theme that comes up quite often on the show, but this idea of if you're a homeowner in the current environment, you kind of, you haven't made, right? I mean, I guess depending on what your mortgage rate is, but if you bought before rates went up, you have a lot of excess purchasing power with which to buy new furniture for your home versus, for instance, if you're a renter and you're paying those higher rents, you don't have that cushion from like pre-pandemic rates. And so it feels like

there's still this issue of haves and have-nots in the housing market that still feeds into something like furniture sales, too. I also think like the economics of population decline are just really interesting because, right, small in population, that's very hard to reverse because, and we've talked about this in other areas, which is that you have some capital stock, right? Like you have 100 houses, okay? And then you have people move away. Those houses don't just stay there. They deteriorate over time. You lose that capital stock.

And so, like, how do you, like, reverse that. Especially in Alaska if you're not doing upkeep. Yeah, that's right. And, I mean, we didn't get into this. But, like, that was just, like, a sort of, like, problem of, like, the sort of negative. It's very hard to reverse the sort of decline in any business or any industry because of just sort of the constriction in supply side capacity that occurs from a structural decline. It's also just broadly amazing how big a deal. deal, the 2013, 2015 oil bust actually was. And I guess, you know, we were covering the oil market

at that time. And so we wrote a lot of stories about, you know, the feed-through into the bond market and stuff like that. But a place like Alaska is really feeling it in a very real way. Until today. Right. Like almost a decade later, or a decade later, I should say. Kind of amazing. All right. Shall we leave it there? Let's leave it there. This has been another episode of the All Thoughts podcast. I'm Tracy Alloway. You can follow me at Tracy Allaway. And I'm Joe Wisenthall. You can follow me at the stalwart. Follow our producers, Carmen Rodriguez, at Carmen Armin, Dashel Bennett at Dashpot and Kale Brooks at Kail Brooks. For more odd lots, content, go to Bloomberg.com slash oddlots, where we have a daily newsletter and all of our episodes. And you can chat about all of these topics 24-7 in our Discord. Discord.G. slash oddlots. And if you enjoy odd lots, if you like it when we go on field trips to far-flung places in Alaska, then please leave us a positive review on your favorite podcast platform. And remember, if you are a Bloomberg subscriber, you can listen to all of our episodes, absolutely ad-free.

All you need to do is find the Bloomberg channel on Apple Podcast and follow the instructions there. Thanks for listening. You can get the news whenever you want it with Bloomberg News Now. I'm Amy Morris. And I'm Karen Moscow here to tell you about our new on-demand news report delivered right to your podcast feed. Bloomberg News Now is a short five-minute audio report on the day's top stories. episodes are published throughout the day with the latest information and data

to keep you informed. Yes, there are other products like this from a variety of news organizations, but they usually rerun their radio newscasts throughout the day. That's not what we do. We create customized episodes that can only be heard on Bloomberg News Now.

And we don't wait an hour to publish breaking news. When news breaks, we'll have an episode up in your podcast feed within minutes, so you're always getting the latest stories and developments. Get the reporting and the context from Bloomberg's 3,000 journalists and analysts we're all over the world. Listen to the latest from Bloomberg News Now on Apple, Spotify, or anywhere you listen. What separates good leaders from transformational ones?

I'm Jessica Chen, and in season two of Leading By Example, we'll sit down with executives like Grace Chen of Bertie Gray to find out. It's important to understand where you spike, but also, really acknowledge where you don't and find people who can fill those gaps. Listen to leading by example, executives making an impact on the IHeart radio app, Apple Podcast, or wherever you get your podcasts.