Link This | Email this | Blog This | Comments (0)

David Perry

Wal-Mart bedding sales: A smart new business plan

What are we to make of the new program that targets mattress sales at Wal-Mart? That was a topic of conversation in bedding showrooms at the fall market. I was asked for my thoughts several times. 

Here’s my expanded answer: 

The bedding program at Wal-Mart is spearheaded by a new company called Mattress Works. A management and marketing outfit based in Greenville, S.C., it is headed by six principals of Park Place, the third-generation, independent bedding maker also based in Greenville. Park Place is a progressive, respected bedding maker. 

Mattress Works has signed supply agreements with Park Place (no surprise) and Hickory Springs. The Mattress Works line, made by Park Place, will be sold only at Wal-Mart, from $299 to $1,299. Mattress Works has a lease agreement with Wal-Mart for the Mattress Works sleep shops. 

This new program is very different from an earlier Wal-Mart bedding effort in which a Park Place executive played a role. The first program ultimately failed, since the bedding company wasn’t up to the challenges of selling bedding in over 100 Wal-Mart stores. But the new program relies on local Park Place retailers to run the bedding departments in leased spaces in Wal-Mart Super Centers. That’s a smart idea. The local retailers will assume the risks — and reap the rewards — for making the program successful. 

I don’t think it’s a slam dunk to sell bedding in Wal-Mart. Yes, big-box retailers have found success with bedding. But the new bedding departments in Wal-Marts must build a customer base. I recently watched a Mattress Works sales associate ask dozens of Wal-Mart customers if they were interested in a new bed. She had few takers. 

That is not to say that consumers won’t find Wal-Mart an attractive place to buy a bed. It goes without saying that Wal-Mart has a tremendous reputation for offering value-priced merchandise. When consumers realize bedding is part of the mix at Wal-Mart, some will undoubtedly be interested in shopping for their next bed there.
One key to the program’s success likely will be what the local retailers do to create awareness that bedding is now available in some Wal-Marts, and what they do to drive sales. 

Mattress Works officials have wisely refrained from offering estimates of how many Mattress Works sleep shops will be opened in the months to come. This program will expand one Wal-Mart at a time, when local retailers commit to the program. 

Slow and steady is probably the best strategy for this new venture. I certainly wouldn’t bet against Wal-Mart in the long term. But it will take time for this program to become meaningful on the national scene. 

That’s my answer, and I’m sticking to it.