Share this on

Bedding faces unanswered questions

Jury is out on how rising prices will impact unit sales in '06

By David Perry -- Furniture Today, December 25, 2005

Specialists on the rise
Innerspring awareness

High Point — The bedding industry faces the new year with some major unanswered questions, but with a solid history of dollar and unit growth working in its favor.

Bedding prices went up throughout the industry this fall, with most producers forced to remerchandise lines. Soaring foam prices wreaked havoc on producers just as the fall market in High Point got under way. Some bedding makers held the line on prices in High Point, but admitted they would have to raise them soon.

Now the industry faces the question of what impact those higher prices will have on consumers. Some believe sales could suffer as some consumers suddenly find themselves unable to afford bedding. But others say bedding will continue to be offered at a wide range of price points, just as it always has.

The foam price hikes and subsequent higher bedding prices could knock the $99 per piece twin prices out of the market, some retailers say. Others wonder if the $299 price point for a queen set also will disappear.

Given the industry's stellar record of growth in both units and dollars, no one is hitting the panic button just yet. Officially, the industry had a double-digit gain in dollars in 2004, one of its strongest showings in years, according to figures from the International Sleep Products Assn.

A look back over the past two decades of ISPA figures reveals that dollar growth was in minus territory only one time, in 2001. That history of strong performances, in good times and bad, suggests the industry will find a way to more than hold its own in 2006 on the dollar side of the ledger.

Foam price inflation obviously will boost the dollar value of bedding shipments next year. Fueling more dollar growth is the industry's increasing emphasis on higher-priced goods. The industry's largest luxury brand, Stearns & Foster, rolled out a revamped line at the October market.

Sealy, S&F's parent, also introduced higher-priced specialty sleep products, and Simmons has debuted new specialty sleep models retailing at more than $1,000.

The situation isn't quite as strong on the unit side of the equation. According to ISPA numbers, unit growth was in minus territory three times in the past 20 years, in 2001, 1990 and 1989. Still, unit growth, like dollar growth, has a long history of positive years.

Other trends bode well for bedding as well.

Furniture/Today reported earlier this year that bedding is the only category that gives furniture stores more back in sales, as a percentage of total sales, than the percentage of floor space devoted to the category. The numbers look like this: While bedding accounts for a median of 8% of the selling space on furniture floors, it generates a median of 10% of total sales, according to Furniture Today's Furniture Store Performance Report.

No other home furnishings category does that well, which is why savvy retailers continue to invest in the mattress category.

Specialists on the rise

Speaking of furniture stores, they continue to set the pace in bedding sales, Furniture/Today's Bedding Distribution Report shows. Last year, furniture stores as a group accounted for 39% of all retail bedding sales. That's down one percentage point from 2002.

The distribution report also documented the continuing rise in share commanded by the bedding specialists. Their share jumped from 33% in 2002 to 36% in 2004. That was the fastest growth of any bedding distribution channel.

If those trends continue, look for the bedding specialists to soon overtake furniture stores as the single largest bedding distribution channel. That could happen as early as next year.

What is driving the specialists' growth? Several factors, bedding insiders say, including a heavy and regular diet of promotions, good selection and service, and strong support from producers.

Another channel on the upswing is the direct-to-consumer segment, which garnered a 5% market share in 2004, according to the Furniture/Today distribution study. The strong performances in that channel by Select Comfort and Tempur-Pedic are particularly noteworthy.

Those two companies made plenty of headlines this year, and both are setting a torrid sales pace that leaves the competition far behind.

Tempur-Pedic's wholesale bedding shipments last year were $320 million, which put the viscoelastic foam leader into the No. 5 spot on Furniture/Today's Top 15 Bedding Producers list. Select Comfort, with wholesale shipments of $263 million, was just behind in the No. 6 spot. Together, those two players boosted their wholesale shipments by 51.4% from 2003 to 2004.

By contrast, bedding's Big Four producers — Sealy, Simmons, Serta and Spring Air — were up "only" 8.8% in that same period.

Those numbers illustrate the soaring growth rates recorded by the specialty sleep majors, and they also help explain the growing number of producers entering the specialty arena.

Innerspring awareness

Can innerspring players put more bounce in their sales? That's one of the goals of the new National Mattress Council, an organization formed by former Serta veterans Ed Lilly and Susan Ebaugh. They want to tout the advantages of innerspring bedding, which have been overshadowed by the attention garnered by Tempur-Pedic and Select Comfort, which present their products as offering compelling alternatives to innerspring bedding.

Specialty bedding is not a fad, leading bedding producers say, and they increasingly are embracing the category with specialty sleep and hybrid lines of their own.

The new year also should see more producers entering the fire-resistant bedding arena. A federal standard is expected to go into effect early in 2007, but a number of producers will have their FR lines ready well in advance of that date. Stearns & Foster included FR materials throughout its new line this fall. Tempur-Pedic made that change in its lines earlier in the year. Serta was the first major to broadly introduce FR bedding.

Another trend worth watching is the increasing interest in licensed bedding lines. This year, Lady Americana introduced its Casa Cristina Mattress Collection, which embodies the lifestyle collections of Hispanic media mogul Cristina Saralegui. Meanwhile, Kingsdown debuted an Oscar de la Renta bedding line, Therapedic launched a Kathy Ireland Home bedding line, and Garme USA introduced a Bob Timberlake bedding line.

Comfort Solutions by King Koil continues to do well with its tie-in with designer/actress Jaclyn Smith, which goes to show that good products, promoted by high-visibility figures, provide a winning formula in bedding.

Share this on

Specialty sleep hits rough patch

Jul 20, 2008

Bedding numbers down, but better than expected

Jun 8, 2009

Mattress sales down 9.1% in 2008, ISPA reports

Jun 3, 2009

Specialty sleep products likely to stay hot

Dec 22, 2004

Specialists sell a wider mix of bedding

Feb 18, 2007

Also by this author

Also by David Perry

Featured Company

Brandwise Inc.

Brandwise serves a model - not just an industry - by integrating, automating, and optimizing the entire sales channel, from wholesale Suppliers to their Reps and the Retailers they service. In short, our software helps Reps and Suppliers sell more and create... more