Note 12 - Segment Information

3 Months Ended

Feb. 27, 2021

Notes to Financial Statements

Segment Reporting Disclosure [Text Block]

12. Segment Information

We have strategically aligned our business into three reportable segments as defined in ASC 280, Segment Reporting, and as described below:

● Wholesale. The wholesale home furnishings segment is involved principally in the design, manufacture, sourcing, sale and distribution of furniture products to a network of Bassett stores (Company-owned and licensee-owned retail stores) and independent furniture retailers. Our wholesale segment includes our wood and upholstery operations, which include Lane Venture, as well as all corporate selling, general and administrative expenses, including those corporate expenses related to both Company- and licensee-owned stores. Our wholesale segment also includes our holdings of short-term investments and retail real estate previously leased as licensee stores. The earnings and costs associated with these assets are included in other income (loss), net, in our condensed consolidated statements of income.

● Retail – Company-owned stores. Our retail segment consists of Company-owned stores and includes the revenues, expenses, assets and liabilities and capital expenditures directly related to these stores and the Company-owned distribution network utilized to deliver products to our retail customers.

● Logistical services. Our logistical services segment reflects the operations of Zenith. In addition to providing shipping and warehousing services for the Company, Zenith also provides similar services to other customers, primarily in the furniture industry. Revenue from the performance of these services to other customers is included in logistical services revenue in our condensed consolidated statements of income. Zenith’s total operating costs, including those associated with providing logistical services to the Company as well as to third-party customers, are included in selling, general and administrative expenses and were $19,621 and $20,480 for the three months ended February 27, 2021 and February 29, 2020, respectively.

Inter-company net sales elimination represents the elimination of wholesale sales to our Company-owned stores and the elimination of Zenith logistics revenue from our wholesale and retail segments. Inter-company income elimination includes the embedded wholesale profit in the Company-owned store inventory that has not been realized. These profits will be recorded when merchandise is delivered to the retail consumer. The inter-company income elimination also includes rent paid by our retail stores occupying Company-owned real estate, and the elimination of shipping and handling charges from Zenith for services provided to our wholesale and retail operations.

The following table presents our segment information:

	Quarter Ended
	February 27, 2021			February 29, 2020
Sales Revenue
Wholesale	$	70,264		$	65,017
Retail - Company-owned stores		60,395			65,846
Logistical services		20,081			21,315
Inter-company eliminations:
Furniture and accessories		(29,004	)		(31,921	)
Logistical services		(8,063	)		(8,137	)
Consolidated	$	113,673		$	112,120
Income (Loss) from Operations
Wholesale	$	4,797		$	2,713
Retail - Company-owned stores		1,094			(1,249	)
Logistical services		459			835
Inter-company elimination		(329	)		(89	)
Consolidated	$	6,021		$	2,210
Depreciation and Amortization
Wholesale	$	798		$	809
Retail - Company-owned stores		1,516			1,730
Logistical services		1,017			1,084
Consolidated	$	3,331		$	3,623
Capital Expenditures
Wholesale	$	757		$	422
Retail - Company-owned stores		18			561
Logistical services		120			357
Consolidated	$	895		$	1,340

	As of		As of
Identifiable Assets	February 27, 2021		November 28, 2020
Wholesale	$	177,204	$	176,243
Retail - Company-owned stores		168,840		169,105
Logistical services		62,917		57,201
Consolidated	$	408,961	$	402,549

Wholesale shipments by type

	Quarter Ended
	February 27, 2021				February 29, 2020
Bassett Custom Upholstery	$	43,348	61.7	%	$	40,033	61.6	%
Bassett Leather		7,587	10.8	%		4,700	7.2	%
Bassett Custom Wood		11,543	16.4	%		11,290	17.4	%
Bassett Casegoods		7,786	11.1	%		8,994	13.8	%
Total	$	70,264	100.0	%	$	65,017	100.0	%