American Freight

American Freight Appliances & Furniture

Company type	Subsidiary
Industry	Retail
Founded	1994
Founder	Steve Belford
Headquarters	Lima, Ohio , United States
Area served	United States
Parent	Franchise Group, Inc.

American Freight Appliances & Furniture, commonly known as American Freight, is a U.S.-based retail furniture chain that originated in Lima, Ohio in 1994. In 2020, it was acquired by Franchise Group and subsequently consolidated with the former Sears Surplus and Sears Outlet stores, all operating under the American Freight name.

Sears Surplus and Sears Outlet

The inception of Sears Surplus stores dates back to 1968 when Sears opened its first outlet in Kansas City, marking its initial venture into outlet retailing.

By 1987, these outlets had been rebranded as Sears Outlet stores. In 2008, the product range expanded to include apparel, serving as a clearance channel for Lands' End merchandise.

In 2012, the parent company Sears Holdings separated Sears Outlet, Sears Hometown, and other related businesses to form Sears Hometown and Outlet Stores, Inc (SHOS), which became an independent publicly traded entity on NASDAQ. At the time of this spin-off, SHOS operated 122 Sears Outlet locations.

The company actively participated in community support efforts, collaborating with the National Volunteer Fire Council in 2013 to assist local fire departments through fundraising initiatives.

Following the Chapter 11 bankruptcy filing by Sears Holdings in October 2018, Sears Hometown and Outlet Stores remained unaffected due to its earlier separation.

In April 2019, Transformco announced intentions to acquire SHOS; however, the initial proposal was declined amid concerns about potential liquidation akin to Sears Holdings.

By June 2019, TransformCo reached an agreement to purchase the remaining SHOS shares. The transaction included a clause permitting SHOS to market and sell its Sears Outlet and Buddy's Home Furnishing businesses ("Outlet Segment") independently for a minimum of $97.5 million. At that point, SHOS managed 491 Hometown stores and 126 Outlet stores across 49 states, Puerto Rico, and Bermuda.

In August 2019, Franchise Group, Inc.—the parent company of Liberty Tax—announced its acquisition of the Sears Outlet division from SHOS for $132.9 million. The deal was finalized on October 23, 2019, coinciding with TransformCo’s completion of acquiring the remaining Sears Hometown operations.

American Freight

Established by entrepreneur Steve Belford in Lima, Ohio in 1994 as American Freight Furniture & Mattress, American Freight had expanded to 95 locations across 18 states by 2014 before being purchased by an affiliate of the New York-based private equity firm The Jordan Company.

In February 2020, Franchise Group acquired American Freight for $450 million and integrated it with the former Sears Outlets under the unified American Freight Furniture, Mattress, Appliance brand. This strategic acquisition significantly broadened the company’s retail presence and market penetration.

Confronted with financial difficulties intensified by increasing expenses and broader economic challenges, Franchise Group announced intentions to initiate Chapter 11 bankruptcy proceedings on November 2, 2024. The following day, formal filings were submitted in Delaware. Despite restructuring efforts, liquidation sales commenced on November 5 with plans to close numerous stores by year-end.

In January 2025, a U.S. bankruptcy court authorized the sale of up to 28 American Freight stores along with one distribution center to AF Newco I LLC. This entity plans to reopen these locations later in the year. Due to regulatory constraints, two additional stores were excluded from this sale. This approach aims to maintain brand continuity and facilitate business recovery amid ongoing sector challenges.

Awards

• Honored with the Customer Engagement accolade by Retail TouchPoints in 2014, recognizing the seamless integration of physical and digital shopping experiences at Sears Outlet locations, underscoring its commitment to omnichannel retail strategies.