The moment arrived: the filing of American Signature Furniture Chapter 11 is now underway. On November 22, 2025, American Signature, Inc. (ASI) submitted voluntary petitions under Chapter 11 to the U.S. Bankruptcy Court for the District of Delaware. The move launches a major restructuring for the parent of the American Signature Furniture and Value City Furniture retail businesses. The company made clear that stores and websites remain open pending the next phase of the process.
Backdrop to the Filing
ASI is a family-owned retailer founded in 1948 and headquartered in Columbus, Ohio. It has grown a network of over 120 locations across roughly 17–18 states, offering living-room, dining-room, and bedroom furnishings through its American Signature Furniture and Value City Furniture banners.
In announcing the restructuring, ASI cited a “challenging operating environment” across the home-furnishing sector and said a court-supervised sale process offers the best path ahead.
Key details of the filing include:
- Estimated assets in the range of $100 million to $500 million.
- Estimated liabilities between $500 million and $1 billion, with creditor count estimated at 1,000–5,000.
- The top 30 unsecured creditors alone are owed approximately $80.25 million, including major furniture manufacturers, logistics firms, and suppliers.
- ASI has secured about $50 million in debtor-in-possession (DIP) financing from Second Avenue Capital Partners, subject to court approval.
- The company has commenced a Section 363 asset‐sale process and anticipates an auction within about 45 days of filing.
What Led to the Bankruptcy
While the company has not laid out each factor in full detail, several issues emerge clearly:
- ASI has already begun exiting certain markets and closing underperforming stores. For example, it exited the Nashville, Tennessee market and initiated liquidation sales in Michigan.
- The macro-environment: high inflation, soft consumer spending on large-ticket items, rising operating costs and supply-chain pressures have put strain on the furniture retail segment.
- Vendor and creditor pressure: With tens of millions owed to furniture manufacturers, transport and logistics firms, ASI’s balance-sheet stress appears to reflect both upstream cost pressure and margin contraction.
Timeline of Key Milestones
| Date | Event & Details |
|---|---|
| Nov 21 2025 | WARN Act notice issued: ASI warned of office closure (4300 E. Fifth Ave., Columbus, Ohio) and layoffs beginning Jan 20 2026 or within 14 days thereafter. Employees were informed of the anticipated filing. |
| Nov 22 2025 | ASI formally filed its Chapter 11 petitions in Delaware, launching the restructuring. |
| ~45 days after filing | ASI expects to conduct a competitive auction of substantially all assets under a stalking-horse agreement. A buyer (ASI Purchaser LLC) is expected to assume major parts of the business, subject to court approval. |
What This Means for Stakeholders
For Customers:
- The good news: American Signature Furniture and Value City Furniture stores and websites are still operating for now. Orders are being processed and inventory is available.
- The caveat: Because the company is in Chapter 11, there is no guarantee full warranty, return or post-delivery service will remain intact indefinitely. If the buyer assumes only select obligations, some programs may change.
- The upside: Many locations are already marketing deep holiday discounts as part of store-closing or liquidation events prior to the broader sale process.
For Employees:
- The WARN notice signals job cuts are imminent. The office in Columbus is slated to close, and layoffs are set to begin around Jan 20, 2026.
- ASI is filing motions to keep wages and benefits in place during the restructuring, but ongoing employment depends on court approval and the outcome of the sale process.
- Store closures in selected markets will likely impact local staff, as ASI has already begun rationalizing underperforming locations.
For Vendors and Creditors:
- With liabilities potentially near the billion-dollar mark and over 1,000 creditors, many unsecured claims face uncertain recovery. The top 30 unsecured creditors are owed more than $80 million.
- Vendors who shipped goods shortly before the filing may find their claims treated as unsecured and likely to receive only a fraction of what’s owed.
- The stalking-horse sale and asset-transfer strategy mean that the acquiring party may not assume all vendor obligations. Victims will need to monitor the court docket and file proofs of claim where applicable.
Retail Footprint & Brand Strategy Going Forward
Despite the filing, ASI has indicated that its core brands will continue to operate during the restructuring. The planned asset sale aims to preserve brand value, customer relationships and store operations where feasible. However, expect the following adjustments:
- Continued exit of lower-performing stores and markets. ASI has already pulled out of Nashville and is liquidating Michigan locations.
- Rationalization of store counts. The buyer may reduce leases, shutter redundant outlets and remove loss-making units.
- Enhanced discounting and inventory liquidation to free up cash, trim inventory and signal urgency to shoppers ahead of the sale.
- Potential changes in vendor and supply-chain relationships. The acquiring entity may renegotiate terms or shift manufacturing and logistics partnerships.
What Consumers Should Consider
- If you placed an order with American Signature Furniture or Value City Furniture that hasn’t yet been delivered, note that in a Chapter 11 scenario the retailer may “assume” or “reject” the contract under bankruptcy law. If the contract is rejected, your claim converts into an unsecured claim.
- If you paid by credit card, you may have stronger protection via a chargeback since the retailer is under a bankruptcy filing. Using a credit card remains the most resilient option for high-ticket purchases during a restructuring.
- If you hold a gift card, store credit, or deposit toward furniture purchase, consider using it sooner rather than later. These items often get devalued or lost entirely during bankruptcy asset sales.
- For major furniture purchases, compare other retailers with no bankruptcy filing risk. Waiting until after the restructuring may leave you with fewer service options or narrower model selection.
Why This Filing Matters for the U.S. Furniture Industry
The American Signature Furniture Chapter 11 case comes amid heightened stress across the home furnishings and big-ticket retail segment. As consumer spending softens and cost pressures build, mid-sized national chains are increasingly vulnerable. ASI’s filing underscores several broader trends:
- The shift away from physical retail footprint in furniture, where large inventories and long lead-times magnify risk.
- Margin compression in furniture manufacturing and sourcing, especially with inflation and overseas supply-chain constraints.
- The need for restructuring tools such as Section 363 asset sales to unlock value in distressed retail chains.
- The ripple effect on suppliers, logistics firms and regional economies when a major chain moves into bankruptcy.
Final Thoughts
The American Signature Furniture Chapter 11 filing is a significant event. For nearly eight decades, ASI has served consumers through American Signature Furniture and Value City Furniture. Now the company enters a court-supervised process designed to preserve value and transition operations to a new owner. For customers, employees and vendors, the road ahead will require vigilance and flexibility.
If you’re impacted as a customer, employee or supplier, keep an eye on court notifications and act quickly where contracts, deposits or claims are involved. The restructuring will shape what remains of the brand and how the retail operations evolve.
We welcome your comments and questions below — share your experience or concerns as this story continues to unfold.