Things were hard enough for Pier 1 at the start of 2018. With sales dropping at an alarming rate of 9.2% year on year within the first quarter, the company was in panic mode. They hired Jeffries in to consult on business strategy and were told there were issued needing investment or attention within its sourcing, merchandising, marketing, pricing, ops, e-commerce, store and supply chain. Call us cynical, but that sounds like the whole of the business. And then the President made things worse!
Well over half of Pier 1's goods are manufactured in China. When President Trump levied a 10% trade tariff against China, it hit Pier 1 directly in the pocket; a blow they couldn't really afford to take. In the aftermath of the decision, Pier 1's credit status was downgraded, making it harder for them to refinance existing debt or take on new borrowing. Unless someone comes up with a great idea fast, they might be running out of time.