Bankruptcy seems determined to be the word of the year.
In the first week of November, Franchise Group, Inc. — a Delaware, Ohio-based company — announced the complete closure of one of its retail chains, American Freight, after filing for Chapter 11.
Regarding the bankruptcy, Franchise Group CEO Andrew Laurence commented, “[The] announcement to de-lever our balance sheet is a pivotal step forward in enabling our market-leading businesses Pet Supplies Plus, The Vitamin Shoppe, and Buddy’s Home Furnishings to realize their full potential. Each of these businesses has a demonstrated value proposition and provides great products and service to customers, which they will continue to do seamlessly during this process.” American Freight, on the other hand, is closing “due to sustained inflation and macroeconomic challenges facing the large durable goods sector.”
American Freight, founded in Lima, Ohio in 1994, was acquired by Franchise Group in 2020. The chain currently operates 328 stores in 41 states, all of which are set to close following a mass liquidation sale already in progress. Product categories include furniture, appliances and mattresses.
Like the Conn’s and Badcock closures earlier this year, this news presents an opportunity for Independent retailers in communities with American Freight locations. Naturally, consumers will flock to the going-out-of-business sales, but at what potential future cost to them? A discounted deal today from a store that won’t be around next year leaves nowhere to go when that appliance needs servicing — or that new sofa needs an updated chair to match.
How to Acquire and Retain Customers During a Competitor’s Liquidation Sale
To recap a previous article on Conn’s and Badcock, let’s look at a few ways to maximize opportunity if your business is located near a closing American Freight store.
- Keep existing customers from settling for less. Bargain hunters tempted to shop the sale may need a reminder of your services and benefits that aren’t going anywhere. Offering a special loyalty discount certainly can’t hurt either. Not only could it help you with retention, but it also could help your bottom line in the long run.
- Target potential new customers. Now may be the time to ramp up your local advertising on Google, social media and everywhere your audience is looking. With Black Friday and Christmas deals underway, your current sale prices could very well rival the prices on those flashy liquidation sale tags. Make it known!
- Currently hiring? Those American Freight employees will be looking for jobs, if they aren’t already. New hires with knowledge of the industry aren’t always easy to find. Whether you use word-of-mouth, local job boards or online options like Indeed and LinkedIn, help these soon-to-be out of work folks find your employment opportunities.
And, to restate verbatim the call-to-action we shared when Conn’s and Badcock went out of business:
“It’s a refrain that you’ve heard throughout this roller coaster of a year, but it stands true, now more than ever: You need to be present. Customers aren’t going to just happen upon your business in droves. Some might. But the businesses that are winning today are the ones that continue to keep their brand and their message in front of their customers in every way possible, in every medium possible. And for the dealers in these Conn’s and Badcock markets, right now is a tremendous opportunity to capture even more attention, eyeballs and sales before someone else does.”
