The new boss of MFI has warned it will take "several years" to turn around the loss-making furniture business.
MFI employs 4,200 people
Gary Favell said MFI had to bring in better products, and said cost cuts would be necessary - although he said it was too early to talk of job cuts.
The 50-year-old takes up the top job at the 200-store UK chain following its sale to private equity group Merchant Equity Partners for £1.
MFI's former - eponymous - parent firm has now renamed itself Galiform.
Galiform will continue to run the Howden Joinery business.
'First choice aim'
Under the terms of MFI's sale, Galiform has agreed to continue to invest £75m in the company by April 2008.
Galiform will also continue to supply MFI for up to two years.
Merchant Equity Partners has pledged to invest £102m in MFI.
"We have to make sure that MFI is the first choice for bedrooms, bathrooms and kitchens," said Mr Favell.
"The products at MFI did not move with the time - they lost their way."
Mr Favell previously turned around the fortunes of rival chain Magnet.
MFI now employs 4,200 people.