Profits reach new highs with high-end bedding
By David Perry, Executive editor -- Furniture Today, January 27, 2002
There's some debate about how to describe it, but there's no debate about its growing clout in the marketplace.
Call it luxury bedding or high-end bedding or ultra-premium bedding, but spell it this way: Profitable.
Elsewhere in this issue you'll find an overview of this hot category. We have taken the somewhat unusual step of running pictures of several high-end beds. Beds are much like icebergs; most of the key features are out of sight. But these beds are so distinctive that we wanted to give you some idea of what they look like.
In recent years, a growing number of affluent consumers (households earning $75,000 or more a year) have purchased bedding at price points that only a few years ago were thought to be out of reach. Breaking the $1,000 retail price point is commonplace today. Beds that target the $2,000, $3,000, $4,000 and even $5,000 price points are making inroads on retail floors across the country.
Why? There are several reasons, but here are a few key ones: The beds take comfort to a new level. They make luxurious statements. They help retailers sell more of the beds underneath them. They also sell in their own right. Since they often have relatively high margins, they give retailers a higher percentage of profit dollars. More importantly, they give retailers more profit dollars, period.
The question about this category, whatever it's called, long has been: How substantial is the volume it generates? I asked half a dozen leading bedding producers that question and got about the same number of answers. One company that specializes in this market believes that 20% of all bedding is sold at $1,000 and above.
That may sound high, but this company notes that there are a number of smaller, non-traditional retailers who do a good job with high-end bedding.
The revelation that Stearns & Foster generates volume in excess of $200 million annually also is an eye-opener. That Sealy-owned producer repositioned its line in 1994 to focus on the upper end of the market, and has enjoyed spectacular growth ever since. Today it ranks as one of the nation's largest bedding brands in its own right.
Another upper-end success story has been written by Kingsdown, which marches to the beat of its own drummer and has enjoyed tremendous growth. Kingsdown also is a Top 10 bedding producer.
Chittenden & Eastman is another producer that does a good job with better bedding. There are a number of others, too many to name them all.
So how big is the high-end category? Big enough to fuel substantial growth at a number of companies, from national players to strong regionals. Big enough to merit the attention of any retailer who wants to improve profitability.
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