Key Points:
- American Signature files for Chapter 11 and plans to close 33 underperforming stores.
- Retailer faces declining sales, rising costs, and weakened demand from a slow housing market.
- Company prepares for asset sale while keeping stores open and fulfilling customer orders.
American Signature Inc., a family-owned furniture retailer operating for more than seven decades, has filed for Chapter 11 bankruptcy protection as it works to stabilize its business and reorganize its operations. The company, which owns the Value City Furniture and American Signature Furniture chains, said it will close dozens of stores as part of its restructuring plan.
In recent court filings, the retailer reported that it intends to shutter 33 stores across the country, representing roughly one-quarter of its total store count. The closures include previously announced locations, with most of the earlier shutdowns occurring in Tennessee. American Signature currently runs more than 120 stores in 17 states and employs about 3,000 workers.
Operational Challenges and Declining Sales
The company outlined several factors contributing to its financial strain, including higher operating costs, elevated interest rates, and weakened consumer activity tied to the cooling housing market. Reduced housing turnover — a key driver of furniture sales — has limited customer demand as fewer households purchase or move into new homes. Industry data shows that home resale activity this year has reached its slowest pace in decades.
Declining sales have placed significant pressure on the retailer. American Signature reported $803 million in revenue for 2025, down from $1.1 billion two years earlier. Court documents also show operating losses over multiple fiscal years, including a net operating loss of $70 million in 2024.
Store Closures and Asset Sale Plan
As part of its restructuring, the company will continue to liquidate inventory from underperforming locations. This process began in September and will expand with the newly announced round of closures. American Signature is also preparing for a potential sale of its remaining assets, with filings indicating that it expects to enter into an asset purchase agreement with an entity known as ASI Purchaser, LLC. The bidder is associated with the Schottenstein family, the founders of the retail group.
While the outcome of the sale will determine the company’s future footprint, American Signature said its stores and websites remain open and that it will continue fulfilling customer orders while the restructuring proceeds.
Business Outlook During Restructuring
The company stated that its primary focus is maintaining operations during the bankruptcy process while working toward a sale that preserves parts of the business. Its current approach includes reducing store count, managing inventory, and reviewing long-term strategies for remaining markets.
For business owners and industry observers, American Signature’s situation highlights how shifts in housing activity and consumer spending patterns continue to influence the retail furniture sector. Companies in the space are closely watching demand cycles, cost structures, and regional performance as they plan future operations.
American Signature noted that the final shape of the business will depend on the sale process and future market conditions as it works through its restructuring plan.
