Roughly half of the retailer's sales, which a source familiar with the deal says are "north of $125 million," take place on online marketplaces and sites other than RugsUSA.com.

Private equity firm Comvest Partners plans to buy rugs and home decor retailer RugsUSA.com Inc., according to a source familiar with the transaction. The deal is expected to be announced on Friday.

Karoosh Yaraghi, the retailer’s CEO, is expected to stay on in that role.

While RugsUSA sells an array of brands, including Milliken, Surya and Jaipur, the majority of its sales stem from its in-house line. Roughly half of the retailer’s sales, which the source says are “north of $125 million,” take place on online marketplaces and sites other than RugsUSA.com.

RugsUSA aims to distinguish its products from the competition by offering low prices. Its website, for instance, shows visitors how much less expensive its rugs are compared to the typical prices consumers might pay for a wool or synthetic tufted 5×8 rug with prices on Macys.com, HomeDecorators.com and Walmart.com.

“These low prices aren’t just a marketing gimmick, but rather a reflection of the way we choose to do business,” the site says. “When we started out, RugsUSA.com operated as a drop-ship retailer, which means we would send your order to the manufacturer who would in turn send your rug directly to you. As our company has grown, the way we do business has changed to better serve our customers. We are no longer a primary drop-ship retailer, and we have moved much of our stock in-house in an effort to bring our customers big savings. Many businesses, which operate as primary drop-ship retailers, often need to double the price of the rug in order to make a profit, but by changing our business model and cutting out the middle man, we can now sell you high-quality rugs at wholesale prices. This is a big savings over our competitors. Our method of operation allows us to offer you the exact same item as other rug retailers at half the price.”

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RugsUSA is No. 957 in the  Internet Retailer 2018 Top 1000.

 

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