Clint Engel
COLUMBUS, Ohio — With the opening of two Rooms Today stores in Michigan, American Signature is testing a new format


that bridges its promotional Value City Furniture brand and more upscale American Signature stores.

The Top 100 company, which will pass $1.1 billion in sales in the fiscal year that ends this month, is counting on the concept to help propel future growth. The retailer aims to appeal to a younger consumer and give itself a third, more versatile store banner to use as it expands in the East and Midwest.

Two 50,000-square-foot Rooms Today stores opened last month in the Grand Rapids suburb of Kentwood, Mich., and in Kalamazoo, Mich.

The main brand sold in the store is the proprietary American Signature, representing about half of the overall mix, and the emphasis is on room-package pricing. Among other key suppliers are Berkline, iJoy and Simmons.

American Signature chose smaller secondary markets for the initial two stores “to perfect the concept,” said company President David Thompson. There are plans for more Rooms Today stores, but he wouldn’t specify other markets or give a timetable for a rollout.

“This is a test,” he said, adding the company is honing the format. “But it feels pretty good. Everything seems very promising.”

Thompson described Rooms Today as “a fresh approach,” with “a cool feeling about it.” It targets a somewhat younger consumer than American Signature and its assortment reflects that, he said. Sofa and loveseat packages start at $699 at Rooms Today compared with $899 at American Signature. The staring price for a group at the more promotional Value City, meanwhile, is $599.

Rooms Today stores have the flexibility to tailor their offerings to the psychographics and demographics of the markets they serve, said spokeswoman Mary Anne Piccirillo.

And that, said Thompson, gives the parent company flexibility it doesn’t have with Value City or American Signature, where consumer perception of the store is ingrained.

“When you hear a name of a store, you get a first impression,” Thompson said. “Value City, typically in all the research we’ve done, means great price to the consumer. It’s much more of a price concept. American Signature Furniture, in the consumer’s mind, has much more of a higher-end (image). They feel good about the quality and, by the way, it’s a good price.”

He said that American Signature has worked well, particularly in the Sun Belt states and South Florida, where all 21  of the stores under that banner are located, Thompson said.

But as the parent company continues expanding in the Midwest and even in the East, it needed a concept that could more easily adapt to what are often very different tastes from one community to the next.

One difference between Rooms Today and American Signature, which was launched with a store in the Nashville market in June 2002, is that while American Signature could stretch upward in price, Rooms Today isn’t tied to one price direction, Thompson said.

“We can take (American Signature) as high as we want to in terms of quality and product line, and as we establish the brand more and more we will continue to lift the quality,” he said.

“Rooms Today is a much more commercial type retail concept, much more for the masses. But it’s kind of a chameleon. We can take it up or down depending on what the market wants,” he said. “We believe it will be a lot more versatile than Value City or American Signature, although it’s still in the testing mode.”

Thompson said the Rooms Today launch is a continuation of American Signature’s expansion strategy, which is “a multi-brand approach.” He said there are great differences in consumer tastes from region to region, which is the reason the furniture industry is dominated by strong regional players, not national chains.

Thompson wouldn’t elaborate on the company’s plans, but said it’s looking to expand using all three of its store formats. “There’s a lot of growth going on,” he said.

He said he doesn’t believe the company would operate Value City and Rooms Today formats in the same market, but that it’s possible Rooms Today might overlap with American Signature.

American Signature operates 119 stores, primarily Value City furniture stores, in 18 Midwest, East and Southern states. Furniture/Today estimates sales for its fiscal year ended July 30, 2012, at $830 million. With projected sales of more than $1.1 billion this year, the company’s sales will grow more than 32%.