Materials costs could push mattress prices higher
David Perry -- Furniture Today, April 3, 2011
AT THE MARKET - Mattress producers showing here say they have raised prices or are considering price hikes as they respond to rising raw material costs.
Those rising costs are hitting the producers at a tough time, when majors have launched new flagship lines and the industry's comeback appears to be faltering.
Sales leader Sealy, which is rolling out its new flagship Posturepedic line, is watching raw material costs closely.
"We are anticipating that the bedding industry will see inflation on material costs during 2011 similar to other industries," said Jodi Allen, chief marketing officer at Sealy. "The bedding industry will be forced to deal with these higher costs and at this stage, a price increase has to be part of the consideration. We will continue to monitor the situation closely at Sealy to determine the options available to us and the specific actions required."
Comfort Solutions anticipated some raw material increases with the pricing of new lines introduced earlier this year, which Dave Roberts, president of Comfort Solutions, called "Plan A." But now the producer is seeing even higher costs of materials.
"What is Plan B?" Roberts wondered. "It's going to be very, very difficult to hold the line." Some "adjustments in product" may have to be made, he said.
Gold Bond President Bob Naboicheck says the industry is in a time of turbulence. The cause, he says, is that "we're in the highest inflationary period for raw materials our industry has seen in decades."
Naboicheck said many brands are "de-specing product to bring costs into line," but asserted that such practices are "unconscionable." He added: "Given the challenges our customers have just to survive and keep their people employed, that is not what a manufacturing partner does to its retail partner."
Gold Bond offers healthy enough margins that its retailers have been willing to accept price increases of $20 or $30 on select mattresses and can still keep retail prices the same and maintain strong margins, Naboicheck said.
Paramount Sleep vowed it will maintain the integrity of its products. "We won't find ways to cut corners," said Jamie Diamonstein, president. "We refuse to buy cheaper foams and we won't compromise on foam quality. Integrity is a key word for us. If a bed has to change price, it will."
"We are seeing price increases on most all fronts," said Kurt Ling, CEO of Pure LatexBliss, a supplier of latex beds. "All increases are significant with some extraordinary. The largest price increases we are seeing are the price of latex (natural formulation and even more so the all natural formulation) and freight. Some are as much as 20%, where other materials are up more in the 7% range."
Pure LatexBliss is implementing a 10% price increase this week.
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