'10 bedding outlook: Modest growth
By David Perry -- Furniture Today, December 21, 2009
HIGH POINT — The new year will get off to a slow start for mattresses, but business will improve in the second half. Overall, it will be a much stronger year for mattress sales.
Those are some of the key thoughts of bedding's largest producers, who dominate the U.S. bedding landscape. They shared their outlook for 2010 with Furniture/Today, which annually assesses the industry's prospects as a new year looms on the horizon.
It's an easy call for the executives to predict better times for the mattress industry, as 2009 will go down as one of the worst years in the industry's history.
Still, mindful of the prolonged slump that has hit the mattress industry, the executives generally offer modest growth projections for the new year.
Here are the predictions from Top 10 bedding producers:
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Larry Rogers, CEO, Sealy: “We believe the mattress industry has the opportunity to stabilize in the first half of 2010, and then return to modest growth in the second half. Additionally, we believe unit growth will outpace average unit selling price growth for 2010, into 2011. Since Sealy is well diversified and continues to focus on growing profitable market share and reducing our operating cost base, we remain well positioned to improve our gross margin and strengthen as a company.”
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Steve Fendrich, president, Simmons: “We're optimistic that 2010 will be a stronger year for mattress sales than 2009. Our forecast shows that the industry will be up approximately 3.5% in units and average unit selling price will remain flat. The industry did a good job meeting changing consumer needs over the past year by providing specific product offerings. As we move into 2010 and begin to see consumer purchase patterns evolve, the (lessons) from 2009 will only improve our ability to respond as an industry with focus and agility.”
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Bob Sherman, president of Serta: “Overall, the industry needs the housing market to rebound. The housing market suffered first from bad loans; now the unemployment rate is a factor. We believe the industry will end up between down 5% to a high of flat sales.”
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Rick Anderson, president of Tempur-Pedic North America: “The industry will rebound off of a very soft 2009 but will still not reach 2007 historical highs. Consumer confidence will remain sluggish during the first half of the year for most consumers, but we believe the exception to this will be premium consumers, who will be the first to return to the market. In addition, there will be an ever-increasing number of premium consumers who simply cannot delay the purchase of a new mattress any longer. These two pools of consumers will serve as the basis for growth in 2010.
“Also, we feel there will be a continued push to higher-quality products that deliver the promise of great sleep. We believe Tempur-Pedic continues to be uniquely positioned to capitalize on this trend. Our high-quality, consumer-preferred products fulfill the promise of the best night's sleep and our 20-year warranty provides the quality assurance that consumers demand in this environment.” -
Bill McLaughlin, CEO of Select Comfort: “While no one can predict what this economy will do, we are confident in our industry, and we are confident that consumers will increasingly understand the importance of sleep and the role their mattress plays in getting a better night's sleep. As they do, the Sleep Number brand will meet their needs for individualized comfort, pain relief, ability to sleep comfortably together as a couple, and value. So, the question is how prepared we are as an industry to meet each customer's need when — not if — the recovery begins.”
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Dave Roberts, president of Comfort Solutions: “The first half of the year will continue to be challenging, similar to the results for the third and fourth quarters of this year. The second half should start the beginning of the industry recovery.”
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Chris Henning, president, North America sales, Kingsdown: “I believe we will see modest unit growth as the economic recovery continues to slowly progress. Unfortunately, there will most likely be some additional failures at the retail and wholesale level as we are still facing reduced consumption by the end consumer. The tendency to place heavy emphasis on promotional offerings is still prevalent and I believe it's imperative that our industry try and offer value, yet with a compelling story built around health and wellness. A focus on higher average tickets is critical.”
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Gerry Borreggine, CEO of Therapedic: “I believe 2010 home furnishings sales will have a slow start, but will grow stronger by the third quarter. The prolonged effect of low interest rates will bolster consumer confidence and spur real estate activity, which should bode well for the entire home furnishings sector.”
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