UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 14A

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of the Securities Exchange Act of 1934

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Bassett Furniture Industries, Incorporated

(Name of Registrant as Specified In Its Charter)

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1

Bassett

Investor Presentation

April 2008

NASDAQ:  BSET

2

Agenda

Business Overview & Industry

Update

Retail Growth Strategy

Rollout & Repositioning Plan

Balance Sheet

Costa Brava’s Bid for Control

3

Business Overview

130 stores –

32 corporate & 98 licensed

75% of sales through store network

3 regional distribution centers

Wholesale sales nearly 60% import, 40%

domestic

2 domestic manufacturing facilities focused on

executing our unique merchandising strategy

1,420 employees –

570 in corporate retail

stores

Becoming a hybrid between specialty &

furniture store

Offering alternative to more expensive

competition

Local design center

Ethan Allen

Thomasville

4

Furniture Industry Update

From 1999 –

2007, China’s furniture exports (1)

have grown 640% from approximately $3bn to

over $20bn

Mass merchandisers (e.g., Wal-Mart, Target,

Costco) have taken share and pressured

margins of pure Home Furnishings retailers

Slowdown within the housing industry has put

added pressure on the home furnishings

industry

Source –

U.S. Dept. of Labor

5

China Furniture Exports &

U.S. Furniture Employment

1999 -

2007

-

2.0

4.0

6.0

8.0

10.0

12.0

14.0

16.0

18.0

20.0

22.0

'99

'00

'01

'02

'03

'04

'05

'06

'07

500

550

600

650

700

750

Chinese exports data per the China National Furniture Association.

U.S. employment data per the U.S. Bureau of Labor Statistics.

6

Home Furnishing Consolidatio

Difficult industry conditions have led to 

consolidation

209 bankruptcies since 1999; 171 in the last five

years (*)

Numerous M&A transactions

November

8,

2007

-

Levitz

Furniture

Inc.

declared its third bankruptcy in ten years

The furniture chain is undergoing outright liquidation

of its assets

February

4,

2008

–

Wickes

Furniture,

retail

furniture chain with 40 stores across the

country, filed for Chapter 11 bankruptcy

(*) Source -

CapitalIQ

7

Industry Undergoing Change

Numerous domestic manufacturing closures;

companies shift to outsourced production

Renewed retail focus with dedication to

improving/attaining profitability, store

presentation and improved customer service

New financial strategies

Capital raise (e.g., STLY’s

$25m private placements)

Credit facilities refinanced (e.g., FNB and LZB)

Dividend decreases (e.g., FBN 75% decrease and LZB

67% decrease)

Share repurchase authorization and purchase  (e.g.,

ETH, HOFT, LEG and STLY)

8

Retail Growth Strategy

Building a Specialty Furniture Retail Brand

Strengthen retail talent

Execute new product strategy

A new store prototype

Modernize marketing effort

Strengthen our Design Services

Build national consistency in our network

9

Strengthen Retail Talent

Retail Leadership

Hired Jason Camp as SVP Retail

Restoration Hardware

Hired Barbara Kurgan as Creative Advisor

Martha Stewart, Elle Decor

Upgraded talent in key retail leadership

roles.

Retail Store Talent

Investing heavily in recruitment and

development of high quality retail talent

Leveraging monthly sessions of Bassett

University for both retail managers and

design consultants

10

New Product Strategy

Become a style leader within 4

lifestyles

Strengthen offering in custom furniture

Create a clear price / value point of

differentiation from EA, Thomasville

and Pottery Barn

Strengthen design capabilities with a

fully coordinated assortment

Grow accessory / drapery business

11

A New Store Prototype

Create 3 custom workshops

Upholstery, Dining and Storage

Showcase our 4 lifestyles

More residential scale and design

Create authority in Design Services

Create a Home Entertainment

destination

Sectionals, Motion and Wall Units

Build authority in Accessories

Drapery, Rugs, Lighting and Mirrors

New Store Format

•3 custom workshops

•4 Lifestyles

•More residential scale

•Design Services

•Authority in Accessories

•Home Entertainment

13

A New Store Prototype

Early results are very encouraging

5 new stores are now open

Higher average volume

Higher average transaction

Higher conversion rate

14

Modernize Marketing Effort

Website

A critical research tool for furniture

shoppers

Piloting web commerce this summer

Catalog

Will mail 9m across 8 drops this year

Design Resource Guide

Launch first bi-annual book this fall

Television

Gain national strength and consistency

through TV

15

Strengthen our Design

Services

Thoughtful accents and accessories

Wall art and mirrors

Lighting & decorative accessories

Fully coordinated textiles assortment

Upholstery Fabrics

Leather Assortment

Rugs / Rug Squares

Custom Drapery in 30 days

Stocked top of bed

Stocked pillows

16

Strengthen our Design

Services

Talented Design Consultants

Aggressively recruiting and developing

high quality Design Consultants

Launching Bassett University

Tools, Technology and Resources

Presentation Rooms in new stores

Prevue & Room Planner in stores/web

Design Resource Guide

Marketing the Capability

Web, catalog, DRG, TV and Stores

17

Retail Strategy Summary

Early results are encouraging

New products are selling briskly

New stores are delivering better

performance

Design Services are increasing

Our national network is gaining

consistency

18

Growth Strategy –

Rollout Plan

(2008 –

2010)

Closing underperforming stores

20 to 25 stores over next three

years

Investing in new stores –

13 to 19

Converting and remodeling a certain

number of stores

19

Retail Store Network

(includes both Corporate and Licensee owned stores)

Targeting improvement in average annual

sales per store

$3.1 million in 2007 to $3.7 million in 2010

Based on achieving a new store annual top

line target of $4.0 to $4.6 million

20

Rollout & Repositioning Plan

Targeted

Today

End of 2010

Corporate

New prototype

3

15 to 20

Old prototype

29

16 to 18

(100% remodeled)

32

31 to 38

Licensed

New prototype

2

6 to 10

Old prototype

96

78 to 88

(50% remodeled)

98

84 to 98

130

115 to 136

21

Store Conversions &

Remodels

Conversion is a complete store redesign to incorporate all of

the facets of the new store prototype.  This represents a

significant capital investment.

Remodel is a redesign that is less in scope and incorporates

only certain facets of the new store prototype.  The capital

investment is considerably less.

Target

Target

2008

2009

2010

Corporate Conversions

2

2

2

Corporate Remodels

3

4

4

Licensee Remodels

10 to 12

10 to 15

10 to 15

22

Planned Capital Spending

for

New Prototype Stores

•

2009 and 2010 targets based on new stores

achieving targeted performance levels.  Our Board

has not approved 2009 and 2010 capital spending.

Based on certain percentage of leases versus

owned real estate on new stores.  New store real

estate could be financed with mortgages.

Target

Target

2008

2009

2010

Conversions/Remodels

2.6

$      

$3 to $4

$3 to $4

New Stores

1.5

*7 to 8

*7 to 8

4.1

$      

$10 to $12

$10 to $12

23

Targeted Store Economics

Assumes 16,000 square foot retail stores

built for $100 per square foot

Approximately $53 per square foot of tenant

improvements and initial inventory costs of

$0.5 million

Total new store investment of $4.5 million

Buy $4.5m, Lease $1.4m

Retail segment growth drives Wholesale

revenue and enables the Company to

capitalize on the Bassett brand

Wholesale Contribution -

$400k on a $4.4

million store

Retail Contribution -

$200k to $500k for store

depending on real estate

Targeted Pretax Returns

Buy 18 –

22%,  Lease 35 to 40%

Conversion 18 –

22%

24

Actual & Targeted

Store Performance

Current

Targeted New

Targeted Total

Bassett Fleet

Bassett Stores

Fleet - 2010

Avg. Sales per sq.ft.

$180

$275

$220

Average Size

17,200

16,000

16,800

Avg. Sales per store

$3.1 mil.

$4.4 mil.

$3.7 mil.

Note - Five new stores are currently achieving targeted levels on average.

25

Balance Sheet

Our balance sheet is bolstered by two

significant investments/assets

1.

Investment Portfolio (Q1 est.)

Marketable Securities

Alternative Asset Fund

2.

International Home Furnishings Center

Listed on the balance sheet as a liability due

to dividends received being in excess of

earnings recorded

3/1/2008

$21.2

$46.8

$68.0

26

Balance Sheet

This strong balance sheet HAS

allowed us to:

Pay out more than $48 million in

dividends over the past five years

(very important to many of our long-

term shareholders)

Invest in store real estate

Sign leases for store expansion

$96 million commitment at 11/24/07

Guarantee leases for certain licensees

$13 million at 11/24/07

27

Balance Sheet

We anticipate our strong balance

sheet WILL allow us to:

Continue paying an attractive dividend

Weather current difficult industry

conditions

Prudently execute our long-term retail

growth strategies

New stores

Conversions and remodels

28

March 17, 2008 Release

Reinforces our belief in long-term

viability of the furniture business and

continued expansion of the retail

program

Will liquidate significant portion of our

investment portfolio over the next two

years to:

Invest in store program –

real estate

$10 –

12 million per year

Subject to the success of new stores

Return monies to shareholders

Increased

dividend

$.225

for

6/1/08

Increased share repurchase authorization

and more aggressive repurchase program

29

April Release

Since

the

March

17

release,

Bassett

shareholders

have offered strong support for the increased ongoing

dividend and aggressive continuation of share

repurchase program

have expressed strong sentiment for immediate return

have noted concern over level of capital spending

Bassett adjusts its financial plan by reducing capital

spending by $15 million over next four years

Bassett’s Board’s intent is to support additional

dividend of $1.25 per share representing nearly $15

million in additional shareholder return, for a total of

$35 million over the next year or so

Bassett’s Board and advisors conclude that a

substantially larger dividend at this time would impair

the Company’s strong balance sheet and would be

imprudent given the downturn in the furniture industry

and tight credit conditions

30

Who is Costa Brava?

A Bassett shareholder for less than

four months

Nominees appear to have no

experience or expertise in the home

furnishings or retail business of any

kind

Sought control without stating any

plan for the future of the company

Now presents a platform that unwisely

promises unachievable short-term

31

What Costa Brava Doesn’t Say

In just 10 years, while numerous

furniture companies have failed,

Bassett has moved from

manufacturing to retailing with over

$400 million in annualized sales

The Company’s retail plan

Is the culmination of more than two years of

extensive study and consultation

Has been cautiously implemented and will go

forward based on demonstrated returns

Relies on a continued strong balance sheet

and a measured approach to new liabilities

Capitalizes on high brand recognition and

more than a century of consumer trust

32

Costa Brava’s letter is wrong.

Costa Brava says Bassett’s plan is too uncertain and is based on a

“very short observation period.”

Costa Brava is wrong.  Bassett’s plan is the culmination of more

than two years of extensive study and consultation.

Costa

Brava

says

Bassett’s

plan

involves

“high

price”

and

“high

risk”.

Costa Brava is wrong.  Bassett’s plan has proceeded cautiously

and will go forward based on demonstrated returns.

Costa Brava says Bassett’s plan will lead to increased liabilities.

Costa Brava is wrong.  Bassett’s plan relies on a continued strong

balance sheet and the measured assumption of new liabilities.

Costa Brava says Bassett “has neither the brand recognition nor

the scale necessary to execute its plan.”

Costa Brava is wrong. Bassett’s plan relies on high name

recognition

and

more

than

a

century

of

building

consumer

trust.

In

just 10 years, Bassett has built one of the largest furniture retailing

networks in the country with over $400 million in annualized sales.

33

What the Company is already

providing shareholders

Cautious execution of its business plan

without depletion or deterioration of

shareholder value

Immediate return of nearly $15 million of

shareholder value through issuance of a

$1.25 dividend plus $20 million to be used

for share repurchases

An increased and substantial regular

quarterly dividend

Continued evaluation of all strategic

alternatives by the Board

34

Bassett’s Board of Directors

Deserves Your Support

Overwhelmingly independent (7/9); no

insiders or affiliated outsiders on key

committees

Significant home furnishings and retail

experience and expertise

Detailed plan for maximizing and

delivering value to shareholders; will

use undervalued non-operating

assets:

To return capital to shareholders in the form

of an immediate dividend, increased regular

dividends and aggressive stock repurchases

To invest prudently in the company’s retail

growth plan based on the success of the new

prototype stores

35

Summary

Conditions are tough but your Board has

experience and a plan to build shareholder

value

Retail strategies properly executed should

allow Bassett to take market share without

risking valuable assets

Growth plan as outlined will allow Bassett to

gain consistency and needed scale

Recent Board action demonstrates

commitment to providing immediate

shareholder return while ensuring enhanced

shareholder value over the long term

Vote FOR the Bassett nominees on the

Company’s WHITE proxy card

36

Certain of the statements in this presentation, particularly those preceded by,

followed

by

or

including

the

words

“believes,”

“expects,”

“anticipates,”

“intends,”

“should,”

“estimates,”

or similar expressions, or those relating to or

anticipating financial results for periods beyond the fiscal year 2007, constitute

“forward looking statements”

within the meaning of Section 27A of the

Securities Act of 1933, as amended.  For those statements, Bassett claims the

protection of the safe harbor for forward looking statements contained in the

Private Securities Litigation Reform Act of 1995.  In many cases, Bassett cannot

predict what factors would cause actual results or future actions to differ

materially from those indicated in the forward looking statements.  Expectations

included in the forward-looking statements are based on preliminary

information as well as certain assumptions which management believes to be

reasonable

at

this

time.

The

following

important

factors

affect

Bassett

and

could cause actual results or future actions to differ materially from those

indicated in the forward looking statements: delays or difficulties in converting

some of its non-operating assets to cash, tax planning considerations,

negotiations with third parties who have an interest in some of the non-

operating

assets

in

which

the

Company

has

an

interest,

economic,

competitive,

governmental and other factors identified in Basset’s filings with the Securities

and Exchange Commission, and the effects of national and global economic or

other

conditions

and

future

events

on

the

retail

demand

for

home

furnishings. 

Financial estimates included in this presentation have been prepared in

accordance with historical accounting practices and do not reflect the effect of

any recent changes in accounting principles or guidance, including the effects, if

any,

of

Statement

of

Financial

Accounting

Standards

No.

157

–

“Fair

Value

Measurements.”