Stuart Carlitz talks with F/T about business and bedding
July 24, 2013,
Recently, Carlitz sat with Furniture/Today's Editor-in-chief Ray Allegrezza to talk about these businesses, his company's strategy, the bedding business and more.
Furniture/Today: Tell me a little bit about Eclipse-Eastman House and the team. How long has each entity been in business and how would you describe each brand?
Mattress Development Company, LLC, which does business as Eclipse and Eastman House, is led by me, the CEO of Ther-A-Pedic Sleep Products Inc., a mattress maker and a leading factory for TheraPedic. We are the founding Ther-A-Pedic factory. My manufacturing business is Ther-A-Pedic Products Inc., and we were incorporated under that name before there was a licensing group.
I learned the licensing business from industry legend and Ther-a-Pedic founder Jerry Gershaw. Jerry signed over 50 factories for Therapedic, and in my opinion is the reason for its success today. Dr. Mark Mandell, a chiropractor and one of the first Eclipse executives, recently rejoined the company this year as a consultant and we most recently hired Will Veitch as vice president of sales and marketing for Eclipse International. Previously, Will held similar roles with Kingsdown, Sealy and Latex International. His new position will be instrumental in our growth locally and nationally.
F/T: What do you see as the competitive advantages of Eclipse-Eastman House?
Carlitz: Besides seven special patents, we specifically designed the Eclipse/Eastman brand as a complete mattress brand to encompass the needs of a consumer at targeted price points and have the added value of Eastman House as the ultra-premium line. We also worked with the largest professional chiropractic association, the Congress of Chiropractic State Assns., to review and endorse the patented Spinal Zone system for better postural support, and have received their exclusive worldwide endorsement for 10 years. Our patented Allergy Free Mattress Design for Federated Department Stores is a breakthrough in healthier bedding. Our Lifedge patent adds steel to the foam encasement to provide edge to edge support in the bed to provide a larger, usable sleep surface. Our newest patents include the Spinal Zone Quilting to enhance the Spinal Zone support system, an ultra-cell gel foam design to eliminate the biggest industry-wide problem of body-impressions, and a patent-pending Surface Modular Foam for use on spring and foam mattresses that eliminates motion transfer, enhances air circulation and improves body contour. These patents add incredible value to the Eclipse and Eastman House mattresses because they contribute to vastly better bedding that consumers want.
F/T: The mattress sector, while fiercely competitive, continues to be one of the strongest segments in the home furnishings industry. What strategies have you employed that have allowed you to grow your business?
Carlitz: In only 12 years since we relaunched Eclipse, we created seven unique patents, landed a coveted chiropractic association endorsement, built a global licensing network, and brought on a staff chiropractor. Our success reflects the powerful combination of great brands, strong leadership and marketing science. Under the stewardship of myself, Jerry Gershaw, and our team, Eclipse and Eastman House are growing through the combined effort of outstanding licensees, business partners, sales teams and manufacturing groups. Since I am an active mattress manufacturer, I am in direct communication with retailers and consumers, so I know what they are looking for and can quickly provide solutions that are further refined for the Eclipse and Eastman House lines for all our licensees to use.
To be more specific as far as product goes, our focus, in addition to traditional innersprings, is to incorporate these patents together with specialty foams and gel foams to create hybrids. A blend of innerspring and specialty foams plus the category of foam bedding alone will lead our company moving forward.
F/T: Where are you now in terms of volume? What about over the next few years?
Carlitz: Even through the recession that hobbled others, we kept growing Eclipse sales. For 2012, our domestic U.S. sales were $45.5 million. As we approach the top 15 manufacturer list, we are looking at double-digit growth, and as we continue to work with our factories and add new licensees, we project to double our sales by 2019 and be in the top 10. As a leading supplier, we have 37 manufacturing facilities worldwide serving 48 countries. We now penetrate over 50% of the global market, so with what we now bring to the table and territories being signed each month, we are interested in adding strong licensees and working together to continue to fuel the growth. Manufacturers are recognizing that they can either become part of the Eclipse brand now or else they will have to compete against Eclipse in the years to come.
F/T: What are some of the innovations you have brought to the market?
Carlitz: Our first patent was Spinal Zone to provide additional support to the middle third of the mattress. We recently supplemented Spinal Zone with Spinal Zone Quilting to virtually eliminate the industry-wide problem of returned bedding due to body impressions. Independent Rollator and Cornell mattress tests with over 10,000 simulations proved the durability of support with the Eclipse mattress patents. Eliminating the high cost of returned bedding with this two-pronged solution provides one of our unmatched benefits to our licensees.
F/T: Earlier, you mentioned having a consulting chiropractor on staff. What role does he play and how has that helped you in the marketplace?
Carlitz: Dr. Mark Mandell is a third-generation chiropractor and business development expert. He is also the author of "Spark Your Sales," and a respected speaker on training businesses to grow their sales. In addition to providing clinical insight into how the human frame interacts with the mattress, Dr. Mandell uniquely understands the market factors that consumers use to select mattresses and works directly with our licensees on marketing and sales programs. When Dr. Mandell was with Eclipse 10 years ago, he helped design Spinal Zone, Allergy Free and Lifedge, some of our most popular patented designs, and was instrumental in helping us with our endorsement by the Congress of Chiropractic State Assns. He will continue to work closely with our research and marketing teams as well as individually with our licensees.
FT: In your business, success often hinges on having the best licensees. Are you adding licensees, and if so, can you give me an update?
Carlitz: Eclipse has not yet reached saturation in the U.S. or around the globe, but we are well on our way. We currently have 37 licensed factories that serve 48 countries. We already cover two-thirds of the domestic market, as well as Canada, China, Taiwan, Russia, South Korea, Australia, New Zealand, South Africa, Singapore, Malaysia, Indonesia, Philippines, United Arab Emirates, Pakistan, India, Turkey, Ireland, Vietnam, Ukraine and more. Some of the countries have multiple factories; for example, A.H. Beard has seven factories in Australia. Other countries, like China, have three licensed factories, but there are plans for four more. We see continued growth opportunities for new licensees in Asia, the Middle East, Europe, South America, Africa and, of course, the United States. We recently added Dutch Craft Mattress of Tennessee and Eclipse of Gulf Council Countries, and expect them to be very successful with the Eclipse and Eastman House brands.
F/T: Where are your factories?
Carlitz: We have seven licensees/sub-licensees in the U.S. in California, Florida, Washington, Illinois, Tennessee and New Jersey. We have the ability through our network to sub-license additional factories. Each U.S. factory can service the four to eight neighboring states, depending on population densities. Globally, we have factories in Canada, China, Taiwan, Russia, South Korea, Australia, New Zealand, South Africa, Singapore, Malaysia, Indonesia, Philippines, United Arab Emirates, Pakistan, India, Turkey, Ireland, Vietnam and Ukraine.
F/T: With factories worldwide, how do you maintain consistency of quality?
Carlitz: Maintaining the strength of the Eclipse, Eastman House and Hemingway Mattress brands is very important to our company. We work closely with the licensees to understand the proper application of the patents, trademarks and designs. Eclipse also has supply chain partners located around the globe who have the Eclipse specifications to supply to the licensees. Each licensee has the freedom to tailor the final product for their specific marketplace, albeit within the Eclipse patents and design and marketing guidelines. Site visits for training and inspections are the best way to assist a licensee, and are completed on a rotating basis.
F/T: Of all your accomplishments and innovations, what are you most proud of?
Carlitz: I am most proud of Eclipse's international growth. The brand has become a worldwide entity with a global reach to over 50% of the world's population. We are able to export American ingenuity and do our part to build brand goodwill for the United States alongside our Eclipse, Eastman House and Hemingway Mattress brands.
F/T: What can we expect from Eclipse/Eastman House in the near term?
Carlitz: Look to see more factories joining in both domestically and globally as we move to become one of the top 10 U.S. mattress brands. We will also see more national and regional accounts bringing on the Eclipse brands. And we will continue to embrace innovations in mattress design and marketing.
We've only just begun. Our licensing began in 1999. What other company has had such stellar growth?
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