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Luxury brands experience a tough year

David Perry -- Furniture Today, June 18, 2006

High Point — Once again, some of the bedding industry's leading luxury brands experienced a tough year.

One of the industry's best-known luxury brands, Stearns & Foster, saw its sales flatten last year, according to Furniture/Today estimates. The newspaper puts S&F shipments in 2005 at $218 million, unchanged from the previous year.

That is an improvement for the brand, which suffered sales declines in 2003 and 2004, but it is a far cry from the last big growth year for S&F, which was in 2002. In that year, Stearns & Foster peaked at $258 million, on the heels of a remarkable 20% sales jump.

But the going for S&F has been tough ever since. Sales of that brand declined 8.5% in 2003 and 7.6% in 2004, according to Furniture/Today's market share estimates.

Another well-known luxury brand, Chattam & Wells, had a down year in 2005. It suffered an 18.5% sales decline last year, compared to a 20.6% decline the previous year. Shipments for Chattam & Wells, which had been $34 million in 2003, were $22 million last year, Furniture/Today estimates. Chattam & Wells is Spring Air's luxury brand.

A third high-end brand, Masterpiece by Serta, had a flat performance in 2004 and was later merged into Serta International. That brand is no longer being produced by Serta, which successfully introduced its Perfect Day line at price points of $1,699 and up last year.

Why the downward trend in luxury bedding?

Bedding insiders say that the high end of the marketplace remains strong, maybe more so than ever, but that it is an increasingly tough, crowded battlefield. Leading specialty sleep producers like Tempur-Pedic and Select Comfort continue to record stellar sales increases, grabbing share at the high end.

And virtually every bedding producer has numerous product entries at $1,000 and above, the price point where the luxury market starts.

The sales breakdowns by brands are based on Furniture/Today estimates. They reveal that while Sealy's S&F brand has struggled to rebound in recent years, and its Bassett brand has remained flat with shipments of about $22 million, the flagship Sealy brand itself has thrived.

In fact, the Sealy brand passed a major milestone last year, cracking the $1 billion mark in its own right. It is the first individual bedding brand to pass that milestone.

Sealy-brand sales, paced by the Posturepedic line, were $954 million in 2004, according to Furniture/Today estimates. But in 2005 the Sealy brand enjoyed a 14.8% sales gain, boosting Sealy-brand sales to almost $1.1 billion.

Breaking out the brands
		Estimated U.S. wholesale bedding shipments in $ millions
Company	Brand	2005	2004	Percent change 2004 to 2005
Figures are for estimated U.S. wholesale bedding shipments. All figures are for calendar 2005 and 2004. All sales information, except for that supplied by publicly held companies that break out U.S. wholesale bedding shipments or companies that provide accountant verified or audited figures, are Furniture/Today market research estimates. Figures exclude shipments to Puerto Rico and include EITF 01–09 sales allowances, incentives and cash discounts. Figures have been rounded to the nearest million. Source: Furniture/Today market research
Sealy	Sealy	$1,095	$954	14.8%
	Stearns & Foster	$218	$218	0.0%
	Bassett Bedding	$22	$22	0.0%
	Total	$1,335	$1,194	11.8%
Spring Air	Spring Air	$335	$351	-4.6%
	Chattam & Wells	$22	$27	-18.5%
	Total	$357	$378	-5.6%

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