The rise and fall of a $500M company: A look at Klaussner’s shutdown

Sheila Long O’Mara//Executive Editor, Furniture Today//August 9, 2023

ASHEBORO – The news that 60-year-old Klaussner Home Furnishings is out of business shook the industry this week, leaving retailers scrambling for new resources and wondering how a company that had sales in excess of $500 million at one time could falter.

Founded in 1963 by Stuart Love as Stuart Furniture, the company announced its closing with an open letter on its website saying its lender was no longer willing to fund operations.

During its earlier days, the company grew into an upholstery powerhouse with its focus on quick-delivery sofa programs that are now a mainstay in the category. Love’s practice was to ship finished product to retailers a week after the order was placed, helping retailers cut down on their inventory loads. Under Love’s ownership, the company’s sales grew to $90 million. Furniture Today estimated Klaussner’s 2020 sales at $270 million, a 10% decline from estimated sales of $300 million in 2019. In 2009, Klaussner’s estimated sales were $500 million.

Former executive J.B. Davis joined the company in 1970, retiring 40 years later in 2010 as president and CEO.  In 1979, Love sold Stuart Furniture to German furniture executive Hans Klaussner, and in 1986, the company’s name was changed to Klaussner Furniture.

In 2001, Klaussner expanded its product offering beyond upholstery to include case goods with the rollout of the Dick Idol collection,  a licensed offering with the wildlife artist and sculptor.

Under Davis’ leadership, Klaussner Furniture grew quickly through acquisitions of companies such as upholstery producer Stylecraft and case goods resource JDI and by capturing considerable floor space at many of the biggest furniture retailers in the business.

The company also launched a high-end upholstery line called Comfort Design in 2009 and unveiled its Enso Bedding brand a year later.

Industry executive Bill Wittenberg succeeded Davis as president and CEO in 2010, and the following year, he led a management buyout of the company with Dave Bryant, chief financial officer at the time, from Hans Klaussner.

The new ownership also moved the company away from its Asheboro-based showroom where the company had traditionally shown new products during High Point Market, to its new 90,000-square-foot showroom located in the heart of the market district at 101 N. Hamilton St.

The company once again entered into a new category with its introduction in 2014 of outdoor furniture and later exited the category at the height of the COVID-19 pandemic in 2021.

Klaussner moved into the country music scene in 2015 when it signed a licensing agreement with Trisha Yearwood to design a whole home collection. Since that initial partnership, the company has introduced nine collections with Yearwood.

In 2017, private investment firm Monomoy Capital Partners acquired  Klaussner. At the time of the announcement, the private equity group said the current management team would remain in place and maintain minority equity stake in the business.

At the time the company employed more than 1,800. As of yesterday, the company’s total employment was 884.

Two years after the Monomoy investment, Wittenberg transitioned to a strategic advisory role on the company’s board of directors, and Terry McNew took the reins as CEO.

McNew left the position last July, and Monomoy tapped David Cybulski for the job in August after serving first as the company’s chief financial officer and later in the interim CEO position.