UPDATE: Finger confirms it will convert to Ashley Furniture HomeStores

Liquidation sale to begin Thursday

Clint Engel -- Furniture Today, August 18, 2008

HOUSTON - Finger Furniture will begin liquidating its four remaining Finger stores then convert them to the Ashley Furniture HomeStores format, bringing a close to the 81-year-old store name here.

Finger President and CEO Rodney Finger confirmed that Great American Furniture Services will run the liquidation sale and that the five Finger buyers will eventually leave the company.

Finger is closing the stores through Wednesday and will then reopen for the sale beginning with a private invitation mailer.

He said the in-store and warehouse inventory is valued at $40 million retail and that the sales should raise enough money to pay the amounts owed to suppliers.

"The Ashley HomeStore business model is much more efficient than the Finger model, and the supply chain is much more reliable," Finger said, adding that Ashley offers "the best value in the industry" and works hard to be the low-cost producer.

He said the retailer is moving toward a model of smaller stores in multi-tenant developments closer to it customers.

"The big box format Fingers has relied on for so long is not working well for our customers today," he said in a release. He added that it is "increasingly difficult" to convince customers to drive long distances for shop for furniture.

"I made the decision because it was the best business decision I could make to ensure our company remains healthy well into the future," said Finger. "At the end of the day, that is the best outcome for our company, our employees and the Finger family."

He said that contrary to rumors going around, Ashley is not buying the company and that the ownership isn't changing.

The Houston-based Top 100 company once had plans to open both large new Finger stores as well as eight to 10 Ashley Furniture HomeStores. This summer, it closed its 150,000-square-foot Finger store in the Greenspoint area of Houston. Earlier this year, it closed its 65,000-square-foot store in Sharpstown Center, southwest of downtown.

Finger opened a 93,000-square-foot store in the Willowbrook area of northwest Houston in October and had plans for another large store in Houston's Woodlands area in mid-2009. That one will now be converted to an HomeStore and outlet.

Two Ashley Furniture HomeStores opened this year to give the retailer a total of four, and Rodney Finger already had said the company would convert its Humble, Texas, Finger store to a HomeStore soon.

Its two other Finger stores are the 250,000-square-foot location on Gulf Freeway in Houston and a smaller store in Sugar Land, Texas.

The Gulf Freeway store will convert to Ashley, but eventually the company plans to redevelop the property into a multi-tenant development, and is not sure yet if a HomeStore will be part of the mix, he said.

Two other Ashley stores are planned for League City and the Woodlands - where the Finger store originally was planned. That store will now be sized down. When the conversions and openings are complete, the company will have 10 Houston-area HomeStores.

The liquidation sales will run for about 120 days with the Ashley store openings staggered beginning in October, Finger said.

Finger was based in Houston until last year, when it moved into a new headquarters and distribution complex in the Sugar Land suburb.