Stop me if you've heard this one before.

"During 2005, like most of the U.S. furniture industry, Bassett has continued to experience a shift in demand from its domestically produced wood products to imported wood products."

No, that "Bassett" wasn't a typo. I realize that the statement sounds an awful lot like the one released yesterday by Motley Fool Hidden Gems selection Hooker Furniture (NASDAQ:HOFT): "[W]e've seen continuing strength in demand for our imported product. . Unfortunately, these gains have been more than offset by the continuing challenges for domestic wood furniture orders, leading to our recently announced Pleasant Garden plant closing." Honest, the first statement didn't come from Hooker, but rather from competitor and fellow North Carolina furniture-maker Bassett (NASDAQ:BSET).

You may also have noticed that, in addition to the similarities in the sales trends cited by the two furniture makers, Bassett is also following Hooker's (now well-established) leadership in how to deal with the trend: by closing a factory and consolidating production of U.S.-based furniture manufacturing within another factory.

While the two firms are pursuing similar strategies in dealing with the problem of U.S. consumers wanting to buy cheaper imported furniture rather than more costly made-in-the-U.S.A. wares, however, their financial results couldn't be more different. Bassett released its earnings numbers one day before announcing its Mount Airy plant closure. And in contrast to Hooker, Bassett seems to have done just fine by its shareholders in Q3. Sales increased more than 5% year over year. Gross margins went up as well, by 520 basis points. And profits grew a heady 60% to $0.16 per diluted share, up from Q3 2004's $0.10.

Really, the only area in which Bassett seems to be lagging Hooker this year is in generation of free cash flow. Despite its many other problems, Hooker managed to bring in $5 million in cash in the first three quarters of 2005. Bassett, in contrast, has seen $0.9 million flow out its doors, primarily as a result of inventory levels that continue to increase (up 12.4% against the year-ago quarter.) That one quibble with Bassett's results didn't seem to faze Mr. Market at all, however. On the contrary, the company received a pat on the back for its performance, with its stock having risen more than 5% for the day yesterday. Will more investors follow suit? Stay tuned.

For more Foolish news and commentary on Bassett Furniture, read:

Sadly, Fool contributor Rich Smith owns shares of Hooker Furniture, but not of Bassett. The Motley Fool has a disclosure policy.