WARREN, Mich. (WXYZ) — Warren Police shut down customer pick-up at the Art Van on Fourteen Mile in Warren again on Monday.
The company filed Chapter 11 Bankruptcy after announcing it will liquidate all Art Van, Art Van PureSleep and Scott Shuptrine stores.
The Warren location is where many people who buy furniture around metro-Detroit are being sent to pick up their purchases, because it is right next to the warehouse.
People who have already paid for the furniture are then finding themselves stuck in an hours-long line. At times the wait was six hours on Monday.
7 Action News spoke to two customers who said they had bought furniture on Friday. They were in line to pick it up on Saturday when Warren Police shut down the store because of massive and angry crowds. When they heard that people would be allowed to start picking up furniture around two Monday, they decided to arrive two hours early. Still, they found themselves behind many, facing an estimated six hour wait.
They made it into the parking lot before police shut down the entrance, banning others from getting in line again on Monday.
Police said the crowds were too severely impacting traffic.
Art Van says it plans to provide pick-up from 11 to 5 all week at the location.
So how did the company that has been selling furniture for 60 years get to this point? The Dean of the School of Business at Oakland University Michael Mazzeo says the way Thomas H Lee Partners bought it in 2017 weakened the company.
“Private equity firms always borrow to make the purchase. They also engaged in what is called a sale lease back. Which means the company sold their stores and leased it back so they never lose the use of the store,” said Mazzeo.
The company then opened new stores while weighed down with debt and rental bills. When sales declined due to on-line competition, the company quickly got in trouble.
The straw that broke the camel's back may have come from overseas.
“What is happening with the China embargo and also the Coronavirus might have been the end of it,” said Mazzeo.
