Art Van Furniture
Regional furniture retailer serving the Midwest.
PE-OWNED
Acquired by Thomas H. Lee Partners2017-04-01
What Made It Great
Quality furniture at affordable prices for Midwest families.
What PE Will Likely Do
Art Van Furniture will likely experience a significant decline in the quality and durability of their furniture offerings as the private equity firm Thomas H. Lee Partners implements cost-cutting measures to improve short-term profitability.
Consumers will notice a shift towards cheaper, lower-quality materials such as lower-grade wood, thinner padding, and less robust construction in their furniture products.
The selection and variety of furniture options at Art Van stores will likely be reduced as the company focuses on maximizing profit margins rather than providing a wide range of affordable, high-quality choices for Midwest families.
Warranty periods and customer service support are expected to be reduced or scaled back, leaving consumers with less recourse if their furniture experiences issues or fails prematurely.
Expected Timeline
“0 to 6 months months”
Announcements about 'cost optimization' and 'streamlining operations' at Art Van Furniture, hinting at upcoming changes.
“6 to 12 months months”
The first round of store closures and staff reductions are announced, likely impacting the availability and responsiveness of in-store customer support.
“12 to 24 months months”
Consumers begin to notice a decline in the overall quality and durability of Art Van's furniture offerings, with more use of cheaper materials and components.
“24 to 48 months months”
Rumors of potential bankruptcy or restructuring start to surface, and Art Van's commitment to maintaining its showrooms and inventory levels further deteriorates.
“48 to 60 months months”
Art Van Furniture may ultimately face liquidation, restructuring, or a fire sale, leaving consumers with limited options for affordable, high-quality furniture in the Midwest region.
Similar Cases
Other companies that followed a similar path after PE acquisition
What You Can Do
Actions
Consumers should be cautious when making furniture purchases from Art Van Furniture, as the quality and durability of their offerings are likely to decline over time.
Consumers should consider alternative furniture retailers that prioritize quality and customer service, rather than short-term profitability.
Consumers should be wary of extended warranty offers from Art Van Furniture, as the company's commitment to honoring these warranties may diminish as it faces financial pressures.
Alternatives
Employee-owned warehouse retailer
Publicly traded retailer with strong values