America’s Furniture Industry Is Starting to Come Apart at the Seams

The furniture business is getting dismantled piece by piece. With mortgage rates still high and housing turnover slowing, furniture retailers are losing the customers they depend on. The result is a growing wave of bankruptcies hitting both legacy chains and discount players as surviving companies race to stay afloat.

Locked out: eMarketer analyst Zak Stambor says furniture retail has become a “sink-or-swim environment” because “as long as housing turnover is at near record-low levels, there’s just less of a market for furniture and home furnishings.” Fewer Americans are moving, which means fewer sofa and furniture purchases. Rising gas prices and tighter budgets are also pushing shoppers toward cheaper options on apps like Temu and Shein, per Barron’s.

• The shift is leaving mid-market chains squeezed between bargain platforms and retail giants like WalmartWMT
  , AmazonAMZN
  , and TargetTGT
  .
• Bob’s Discount Furniture says 25% tariffs on upholstered goods are squeezing margins, forcing the company to shift production out of China and renegotiate shipping contracts.

The Furniture Trade Loses Its Cushion

The pressure is no longer limited to US storefronts. China’s furniture industry is also feeling the fallout after exports to the US fell 18% last year as tariffs pushed American buyers toward Vietnam and Mexico. The slowdown dragged growth in Foshan, the country’s furniture manufacturing hub, down to just 0.2% in 2025 compared to China’s 5% national growth rate. Factory owners that once relied on massive Walmart and Home DepotHD

orders are now scrambling to move upmarket or pivot to direct-to-consumer sales online. Foshan’s Nicole Luk notes that the industry is changing “very quickly” and has become “very hard to predict.”

• Conn’s HomePlus and Badcock, plus American Freight and American Signature, have all collapsed since 2024, wiping out nearly 1K furniture stores as weak demand crushes the industry.
• Circle Furniture shut all nine locations after sales fell 20%, while RHRH
  CEO Gary Friedman said the sector has seen more fallout “than at any time in history.”

Survival mode: Larger players are adapting while smaller ones disappear. RH and Bob’s Discount Furniture are leaning on scale to manage rising costs, with Bob’s COO Ramesh Murthy saying the company feels confident handling future fuel shocks because of its strong shipping and delivery relationships. That kind of flexibility is becoming a luxury most mid-sized furniture retailers simply cannot afford. With inflation potentially climbing above 4% this year, the industry shakeout is rearranging the furniture business for good.