The story
Early years
DirectBuy was founded as United Consumers Club in 1971 in Merrillville, Indiana, by James L. Gagan. It grew substantially over the years, as it franchised; at its height, the buying club had over a million members, with a peak of 167 showroom locations across North America. The first Canadian franchise was founded in 1996. The company changed its name to DirectBuy in 2004.
DirectBuy was ranked No. 4 in the Entrepreneur 2007 Franchise 500 in "Miscellaneous Services."
New ownership, bankruptcy filing and reorganization
United Consumers Club remained the holding company for DirectBuy until December 19, 2007, when DirectBuy was acquired for $550 million by private equity firm Trivest, and Allied Capital Corporation, with $83 million to support the buyout.
On November 1, 2016, with approximately $185 million in debt, DirectBuy filed for Chapter 11 bankruptcy. By then, the company had closed all 160 of its franchised showrooms, and had shifted from its store-based model to a focus on e-commerce. In February 2017, Austin, Texas-based private equity firm CSC Generation, an affiliate of Chinese private equity firm China Science and Merchants Capital Management, acquired DirectBuy in a bankruptcy deal.
In January 2018, DirectBuy acquired the Sears Canada parts and warranty business, creating a new warranty membership for DirectBuy members who hold extended warranties from Sears and had been left without coverage on their appliances when Sears went out of business. Also in January 2018, after having closed all but six of its showrooms, DirectBuy began opening new scaled-down brick-and-mortar clubs, with the first opened in Houston, Texas, and plans to open around 24 in the next two years. The Texas location would later close, and none of the 24 stores would be opened due to low sales. That month, the company announced that it is looking to acquire small furniture stores in cities where it has members. On October 16, 2023, DirectBuy filed for bankruptcy for the second time in seven years.
From Wikipedia’s article on DirectBuy, shared under CC BY-SA 4.0.4