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Mattress Firm eyes Fla.

By David Perry -- Furniture Today, June 18, 2006

Big move in Arizona
Reshaping management

Houston — Mattress Firm, one of the largest U.S. mattress retailers, is preparing to expand into a new market or markets in Florida in six to 12 months as part of a bid to significantly grow its business.

Gary Fazio, chairman and CEO, said the retailer has spent the past few years positioning itself "for accelerated growth."

The company, based here, believes the Orlando and southeastern Florida markets offer attractive growth potential. "We believe in Florida," said Fazio, a 34-year bedding veteran who joined Mattress Firm in 2001.

Mattress Firm now has about three dozen stores in Florida in the Tampa, Sarasota and Jacksonville areas, which it entered in the late 1990s, he said. "We've had double-digit gains in that market," he said. "Florida is a growing area."

The company is the third-largest U.S. bedding retailer, behind Select Comfort and Sleepy's, and says it is the largest specialty retailer of top-of-the-line Sealy bedding and Tempur-Pedic visco mattresses. Other suppliers include Simmons, Select Comfort and Spring Air.

Despite maintaining its net store count last year at 314, Mattress Firm's sales jumped 19.9% to $356 million, according to Furniture/Today's Top 100 U.S. Furniture Stores report. The company-owned stores in the chain, the largest part of the retailer's operations, recorded sales gains of more than 25%, Fazio said.

Big move in Arizona

Mattress Firm recently made a big growth move with its acquisition of Chandler, Ariz.-based Metropolitan Mattress, a 26-unit retailer. That made it the largest mattress retailer in greater Phoenix and pushed its store count close to 340.

Fazio said the company is looking at both acquisitions and organic growth.

To position itself for expansion, he said, the retailer has developed an updated store concept that it has been rolling out since 2001. It features a racetrack design executed with wood flooring, and uses accessories and warm colors to create a comfortable, home-like look and feel.

"This design makes us look contemporary," Fazio said. "The stores feel fresh and updated."

About two-thirds of the Mattress Firm stores have the new concept, he said.

The retailer has introduced its new concept in its regular retail format of around 4,000 square feet and in a SuperCenter format of 6,000 to 8,000 square feet.

A few of the company's stores are even roomier. One of the newest, in Houston, is the largest in the chain at 18,000 square feet, and Fazio believes it's also the largest bedding store on U.S. soil.

"I've shopped every store in the country," he said. "There are none larger. I also think it's the best store."

Reshaping management

Another key step in the growth strategy has been reshaping the company's management team, Fazio said.

Steve Stagner, who co-founded the retailer's largest franchise, Atlanta-based Elite, was recently named president of Mattress Firm. He joined the company in January 2005 as a result of a merger of Mattress Firm and Elite. Jeff Quinn, now vice president of stores, also joined the company in the Elite merger.

Other key executives include Dan McGuire, senior vice president of new business development; Gary White, director of real estate; Brian Bandarra, senior vice president of sales; Bill Dandy, senior vice president of marketing; and Mike Marrie, chief information officer.

Fazio said the management team includes leaders with broad experience in consumer products marketing as well as bedding veterans.

A customer-focused approach is another key element of the company's strategy. Mattress Firm wants to improve the retail bed-buying experience, Fazio said. It gives its sales associates extensive training, and tests and observes them to help improve their skills.

What happens after the sale is important too. With its Red Carpet, the delivery team literally rolls a red carpet into the consumer's home, and leaves mints on the pillows. "We want to make sure that (delivery) is a good experience," Fazio said.

He said the company will expand carefully, following a well-considered plan.

"We would rather do things right than do things fast," Fazio said. "Speed is not always the winner. We are thoughtful about what we do."

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Mattress Firm eyes Florida

Jun 22, 2006

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