Home improvement chain goes bankrupt as industry sales slow nationwide

North American Builders Supply, a supplier of building materials, millwork, hardware and related products, filed for Chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Northern District of Illinois on Wednesday.

The company is filing with $1 million to $10 million in liabilities and has identified at least 49 unsecured creditors, court filings show.

The news comes at a time where home improvement giants like Home Depot report sluggish sales and change in consumer demands.

According to CNN, Home Depot, “the bellwether for US consumers and the housing market,” announced a modest 0.2% sales increase in Q3 (July-September) of 2025.

In response, the chain slashed its profit forecast for the year.

“We believe that consumer uncertainty and continued pressure in housing are disproportionately impacting home improvement demand,” Home Depot CEO Ted Decker said in a statement.

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Similarly, Lowe’s — another big name in home improvement — reported a weak demand in “do-it-yourself” projects in 2024.

Lowes reported a 5% decline in sales from Q2, 2023, to Q2, 2024, a trend that’s seemingly continued.

Last month, Lowe’s reported a minor sales increase of .04% compared to the same time last year — attributing its growth to an initiative that shifts target sales from DIY projects to “Pro customers.”

Pro customers include general contractors, business owners and customers buying in large quantities.

However, industry analysts point to strained sales for the remainder of 2025, at least.

According to a September Home Improvement Research Institute report, earlier this year, the organization projected a 3.4% growth in the overall home improvement market but slashed that to 2.5% just three months later.

Analysts attribute the pitfalls to inflation and a stalled housing market — headwinds that home improvement chains like North American Building Supply aren’t immune to.

NABS’s Chapter 11 filing signals an opportunity to restructure, rather than liquidate.

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A Chapter 11 bankruptcy filing is “often called the reorganization chapter,” as it allows companies to “reorganize without having to liquidate,” as per U.S.Courts.gov.

“In filing a chapter 11, the debtor presents a plan to creditors which, if accepted by the creditors and approved by the court, will allow the debtor to reorganize personal, financial or business affairs and again become a financially productive individual or business,” U.S.Courts.gov explains.