A sudden storm is sweeping through the cross-border e-commerce industry. Could anyone have imagined that home furnishing powerhouses thriving on Amazon might collapse overnight? The abrupt shutdown of United Furniture Industries (United), a major American home furnishings company, has sounded alarm bells across the sector. The company, which owns well-known brands like Lane Home Furnishings, announced permanent closure, leaving 2,700 employees jobless and sending shockwaves through the industry.
The Fall of a Furniture Giant: United Furniture Industries Closes Permanently
United, one of America's largest furniture manufacturers, operated 18 factories, offices, and distribution centers across California, Mississippi, North Carolina, and Ho Chi Minh City, Vietnam. In 2017, the company acquired Lane Home Furnishings, strengthening its position in the upholstered and case goods furniture market. Lane Home Furnishings was once among America's fastest-growing and largest manufacturers, beloved by consumers, with numerous best-selling listings on Amazon.
However, in an unexpected move, United's board announced the termination of all employee contracts effective November 21. In a message to staff, the company cited "difficult and unexpected circumstances" as the reason for closure. The decision excluded truck drivers currently making deliveries, who would be compensated for their work that week.
Abrupt Layoffs Spark Legal Controversy: Potential Violation of Federal Law
While Lane Home Furnishings' Amazon store links appear unaffected and continue to operate, United's layoff methods have raised legal concerns. Several attorneys noted the company may have violated the federal Worker Adjustment and Retraining Notification Act (WARN Act).
The law requires companies to provide 60 days' notice before plant closings or mass layoffs, including payment of at least 60 days' wages and benefits. However, business departments in North Carolina, Mississippi, and California have yet to receive the company's filing. Additionally, failing to provide unemployment health insurance may violate employment laws.
United Furniture Industries will likely face multiple lawsuits as the aftermath of its shutdown continues to unfold.
European Home Furnishing Retailer Declares Bankruptcy: Eve Sleep Succumbs to Market Pressures
Similarly, Europe's prominent home furnishings e-commerce company Eve Sleep has faced difficulties. After sustained losses and stock price declines, the company entered liquidation, with its brands, websites, and assets acquired by bedding retailer Bensons for Beds.
Founded eight years ago, Eve Sleep specialized in direct-to-consumer furniture sales, with its signature boxed mattresses selling tens of thousands annually and monthly visits peaking at 2.7 million. Despite generating £26.6 million in revenue in 2021 and seeing its stock surge over 54% last February, the company couldn't overcome persistent losses and market downturns.
Bensons for Beds, the UK's largest bedding retailer, will maintain Eve Sleep as an independent brand under its ownership.
Platform Giants Face Layoffs: Amazon and Shopee Streamline Operations
The downfall of United Furniture Industries and Eve Sleep has heightened concerns among cross-border e-commerce operators. Indeed, the entire industry faces significant challenges this year, with even platform giants struggling.
Amazon plans to cut approximately 10,000 jobs starting this week, primarily affecting its devices division (including voice assistant Alexa), retail, and human resources departments. If confirmed, this would mark Amazon's largest-ever layoff, reflecting slowing e-commerce growth and broader economic concerns.
Earlier this month, Amazon announced a corporate hiring freeze. Beth Galetti, senior vice president of People Experience and Technology, stated the company must balance hiring and investments amid unusual macroeconomic conditions.
Meanwhile, Shopee has implemented widespread layoffs across Indonesia, Mexico, Argentina, Chile, Poland, and most recently Singapore, primarily affecting HR and learning development departments. The company claims these measures aim to optimize operational efficiency toward self-sufficiency while supporting affected employees.
Cross-Border E-Commerce Faces Profound Adjustments: Challenges and Opportunities
Current economic conditions have forced many cross-border e-commerce companies to adjust operations and reduce expenses. While large corporations can sustain operations through layoffs and restructuring, small and medium enterprises risk closure.
Layoffs remain a sobering reality of global economic downturns. As winter approaches, a reshuffling of the world economic order gradually unfolds.
Yet crises present opportunities. Facing market pressures, cross-border e-commerce businesses must respond calmly and proactively. Refining products, improving services, and enhancing core competitiveness will prove essential for enduring intense market competition.
Future Trends in Cross-Border E-Commerce
Precision Operations Become Essential
The era of extensive growth has ended. Cross-border e-commerce businesses must prioritize precision operations, including targeted marketing, supply chain optimization, and customer relationship management. Data analysis and consumer insights will help companies better understand market demands, improve efficiency, and reduce costs.
Brand Building Gains Importance
In competitive markets, branding proves critical for differentiation. Companies must cultivate brand image, awareness, and reputation. Through quality products, exceptional service, and effective marketing, businesses can build loyal customer bases for sustainable growth.
Compliance as a Baseline Requirement
With increasing global regulations, compliant operations form the foundation for survival and development. Companies must understand and adhere to international laws covering taxation, intellectual property, and product safety to avoid unnecessary risks.
Diversified Channel Strategies
Overreliance on single platforms carries risks. Businesses should expand into independent websites, social media, and offline channels to reduce dependency and enhance resilience.
Technology-Driven Innovation
Artificial intelligence, big data, and cloud computing are transforming the industry. Companies must embrace technological advances to improve efficiency, user experience, and market expansion.
Strategies for Navigating Market Challenges
To weather current difficulties, cross-border e-commerce companies should consider these approaches:
1. Cost Control and Efficiency: Optimize supply chains, reduce procurement costs, streamline staffing, and enhance marketing conversion rates.
2. Core Product Focus: Concentrate resources on flagship products, improve quality, and innovate to meet market needs.
3. Niche Market Development: Target specialized markets with customized offerings and distinctive branding.
4. Risk Management and Compliance: Understand legal requirements, protect intellectual property, and establish contingency plans.
5. Strategic Partnerships: Collaborate with suppliers, logistics providers, and industry peers to share resources and expand markets.
Long-term prospects for cross-border e-commerce remain strong, with global expansion of brands representing an inevitable trend. However, amid current economic uncertainties, businesses must exercise caution and strengthen internal capabilities to succeed in future competition.