Mattress imports post double digit gains for July, August

ALEXANDRIA, Va. – Mattress imports to the U.S. continue on the ascent, posting double-digit gains in July and August, an industry report says.
The third quarter report issued by the International Sleep Products Assn. includes figures on mattress imports in July and August that show double digit dollar and unit growth.

ISPA presented U.S. International Trade Commission data showing that the customs value of imported mattresses jumped 13.2% for July and August imports, while units in that same time period were up 11.9%.

For the January-August period, the customs value of mattress imports is up 19.5%, while units are up 22.2%, ISPA said.
The average unit price for mattress imports was up 1.1% in the July-August period, to $97.53, ISPA said. For the January-August period, the average unit price for mattress imports was down 2.2%, to $94.36.

Breaking News Mattress Firm files bankruptcy

Mattress Firm and its subsidiaries today filed voluntary Chapter 11 restructuring cases in U.S. Bankruptcy Court in Delaware to implement a prepackaged plan of reorganization.
The company said the plan provides Mattress Firm with access to new financing to support the business, establishes an efficient and orderly process for closing certain economically inefficient store locations, and provides for all trade creditors to continue being paid in full for goods and services provided.

The company said the action will strengthen its balance sheet and optimize its store footprint.

Mattress Firm said customers will continue to find the mattress and bedding accessories they need in stores and on their website as normal.
The company said it will take steps to ensure that deliveries will be made as scheduled and without interruption.
It announced that it had secured commitments for $250 million in debtor-in-possession financing to support operations.
It said it expects to complete the restructuring within the next 45 to 60 days with commitments for $525 million of senior secured credit facilities enabling it to emerge from Chapter 11 and support operations thereafter.
“The process we have initiated today will allow us to strengthen our balance sheet and accelerate the optimization of our store portfolio,” said Steve Stagner, the company’s executive chairman and CEO. “Leading up to the holiday shopping season, we will exit up to 700 stores in certain markets where we have too many locations in close proximity to each other.
“We intend to use the additional liquidity from these actions to improve our product offering, provide greater value to our customers, open new stores in new markets, and strategically expand in existing markets where we see the greatest opportunities to serve our customers.”

Mattress Firm bankruptcy imminent

HOUSTON – Mattress Firm is preparing to file for bankruptcy protection as soon as this week, a media report says.
Reuters reported that the company “is preparing to file for bankruptcy protection as soon as this week as it seeks to exit costly store leases and shore up its business as retailers struggle.”

It said that information came from “people familiar with the matter.”

A number of analysts have said that a bankruptcy filing for Mattress Firm is likely in the near future.
Mattress Firm says it doesn’t comment on analysts’ speculation about its future.
Reuters reported that once Mattress Firm files for bankruptcy, the process is expected to be completed within a couple of months and added that Mattress Firm’s vendors are expected to be repaid in full. That information comes from sources who asked not to be identified because they were not authorized to speak to the media on the matter, the story said.
Mattress Firm would shed some of its stores in the process, the sources said.

USTR finalizes $200 billion in China tariffs

10% tariffs take effect Sept. 24, then rise to 25% Jan. 1, 2019

WASHINGTON- The U.S. Trade Representative’s office on Monday finalized an additional $200 billion in tariffs on Chinese-made goods including furniture that would initially be subject to a 10% tariff but that would eventually rise to 25% Jan. 1, 2019.
The announcement brings clarity to an issue that the industry has anticipated mostly with concern due to the impact such tariffs could ultimately have on their businesses and consumers over the long term.

The move is the administration’s way of addressing the theft of American intellectual property and forced transfer of American technology. The initial 10% tariffs on furniture and bedding take effect Sept. 24, then rise to 25% in January.

The final list represents the administration’s third round of tariffs on Chinese made goods, falling on top of an additional $50 billion on two initial rounds that took effect earlier this summer.
The third round contains 5,745 full or partial lines of the original 6,033 lines of goods facing tariffs first announced July 10. At a first glance, it appears that most wood and upholstered furniture and bedding remains on the list. See the final list.
The latest round also follows a six week public comment period that included a series of hearings at the USTR office in Washington from Aug. 20-27. See related story and comments from the industry at the following link.
Related story: Youth products industry weighs in with USTR on tariff issue
The 297 items removed from the list include certain consumer electronics such as smart watches and Bluetooth devices; certain chemical inputs for manufacturered goods, textles and agriculture; certain health and safety products such as bicycle helmets and child safety furniture including carseats and playpens.
Of the total $250 billion in tariffs, the USTR issued the following statement.
“Unfortunately, China has been unwilling to change its policies involving the unfair acquisition of U.S. technology and intellectual property. Instead, China responded to the United States tariff action by taking further steps to harm U.S. workers and businesses. In these circumstances, the President has directed the U.S. Trade Representative to increase the level of trade covered by the additional duties in order to obtain elimination of China’s unfair policies. The Administration will continue to encourage China to allow for fair trade with the United States.”

New mattress stores up heat to help refugees: Startup company wins $250,000 in seed money

BEIRUT – A team from Rafik Hariri University in Lebanon has created a mattress which will help to keep refugees in tents warm at night.
The university team created a startup company, called Heatechs, which has discovered how to integrate a material into mattresses that releases heat accumulated during the day for up to seven hours at night. The technology for the mattresses is now patented after three phases of development, software simulation and prototype testing.

The discovery has also resulted in a seed grant of $250,000 for Heatechs from the first edition of Hult Prize Lebanon. Starting this year, Hult Prize Lebanon will donate $1 million annually in seed capital to a startup idea that judges choose as being the most profitable and sustainable.

According to the Lebanon Daily Star newspaper, the program is in partnership with the BLOM Bank and the Lebanese Central Bank.
“The mattress technology,” said Adam Choufi, Heatech’s CMO, “makes it especially useful for refugees, who, when they turn their stoves on at night to stay warm, risk fires inside the camps.”
The founder of the Hult Prize Lebanon is Ahmad Askhar, a Palestinian-American social entrepreneur. He says that the prize offers him a great way to give back to his home country from his success.
“As I get older, more gray-haired,” said Askhar, “it becomes more important for me to give back to my roots.”
The various teams vying for the Hult Prize were challenged to harness the power of energy to improve the lives of 10 million people. The Clinton Foundation and the U.N. Sustainable Development Goals team also partnered with Askhar on the competition.

Interest grows in boxed bed arena as higher-priced models debut

LAS VEGAS — The boxed bedding category drew new entrants to the recent market here and expanded upward into higher price points, signs of even more growth to come in that hot category, producers reported.
Boxed beds were featured in a growing number of showrooms, including Southerland, which successfully entered the category, officials said.

Business is booming at Brooklyn Bedding, a maker and retailer of boxed beds, and the company expanded its product line here with six new mattresses to meet growing demand for its products.

The new beds lend themselves to private-label programs for retailers shopping the market here, officials said.
“I can’t overemphasize the momentum we’ve gained by expanding our wholesale business,” said John Merwin, CEO of Brooklyn Bedding. “Broadening our footprint has broadened our vision and our ability to innovate — to better understand the business needs of our partners while solving the sleep needs of customers across the country.”
Eclipse International responded to the success of its Velika European-style luxury bedding program with the introduction of a new bed-in-a-box design. Laska by Velika will give retailers a luxury boxed-bed design that touts the high-end style Eclipse brought to the marketplace with Velika, company officials said.
As the bed-in-a-box business continues to grow, Eclipse sees significant potential in the luxury bedding segment of the category. Traditionally thought of as an opening price point business, boxed mattresses tend to offer few upscale features, Eclipse officials said. They noted that they are aiming to change that perception with the introduction of Laska by Velika, which will retail at $2,999 in queen, with a platform unit.
“The successful launch of Velika and strong encouragement from retailers helped solidify our decision to design a model that could be easily boxed and shipped anywhere,” said Stuart Carlitz, CEO of Eclipse International. “This enhanced boxed bed will feature the great upscale look and design that the original mattress offers.”
Classic Brands got dressed up for the bedding market here, bringing upscale looks to the hybrid boxed bedding category. The new beds should “suit” retailers and consumers alike, officials said.
Mark Owen, executive vice president of sales and business development at Classic Brands, said his company got a “fantastic” response to its new Savile Row collection, which features boxed bedding at retail price points of $799 to $1,499 in queen. “Dealers loved the higher-end look and feel of these mattresses,” he said. “They realize they don’t have to limit themselves to price points below $1,000 for bed-in-a-box.”
The new beds feature two layers of encased coils as well as memory foam and latex and gel foams. Available with profiles of 12, 13 and 15.5 inches, the mattresses have fashion-forward knit covers that blend deep blue and gray hues, reminiscent of men’s suits, officials said.
Like all Classic Brands mattresses, the Savile Row collection can be boxed and shipped by UPS or FedEx.
Soft-Tex International offered a broad assortment of new products here, spotlighting its boxed bed products and programs.
The company’s introductions included a new sourcing-as-a-service solution for compressed and roll-packed mattresses, a new line of adjustable bed bases and new RTA furniture products.
As the demand for compressed and roll-packed mattresses continues to increase, Soft-Tex unveiled a comprehensive sourcing-as-a-service solution for retailers looking to launch new mattress-in-a-box programs or to lower their costs. Soft-Tex is touting its track record of providing retailers with high-quality memory foam mattresses at lower costs than domestic suppliers, officials said.
Independent bedding producer Southerland noted that direct-to-consumer sales continue to grow in the boxed bedding category and said its new boxed bed program is designed to allow independent retailers a competitive edge with a private-label program that offers custom branding.
The six-model boxed bed collection under the iBnB Program will be packaged in a box that can easily be branded for the retailer and will allow drop shipping to consumers by Southerland, officials said.
“Our independent retailer partners are eager to have a committed partner to support them in selling well-made mattresses that can compete in the growing roll-pack mattress business,” said Bryan Smith, president and CEO of Southerland. “With our iBnB Program, we’re providing retailers with a private-label option that will allow them to compete with some of the more popular names in the category.”
Retail interest in the new boxed bed line was strong, Smith said.
Diamond Mattress sees interest growing in its private label boxed bedding program, said Shaun Pennington, president.
“Retailers like the product differentiation, flexibility and control that private-label programs offer,” he said. “And retailers don’t need to change those lines every year.”
Enso’s boxed bed display program continues to attract interest, said Mark Akerman, president. Enso offers a display system that helps retailers illustrate the benefits of boxed beds with a modest investment in real estate, he said.
“There is more interest in the bed-in-a-box category,” Akerman said. “We are seeing some retailers and manufacturers fall out of the category.”

Matt Firm ‘considering’ bankruptcy filing

HOUSTON – Mattress Firm “is considering a potential bankruptcy filing,” a Reuters story says.
The story says Mattress Firm is considering the move as it seeks ways to get out of “costly store leases” and shut some of its 3,000 locations “that are losing money,” according to “people familiar with the matter.”

The sources said Mattress Firm and its parent, Steinhoff, are working with consulting firm AlixPartners LLP, a company often brought in to lay the groundwork for bankruptcy, Reuters reported.

Reuters noted that its sources said that Mattress Firm has not made any final decisions and its plans could change.
A Mattress Firm spokesman had no immediate comment on the Reuters report.

Key purchase prompt for consumers? Health concerns

HIGH POINT — Health concerns are a
key purchase prompt for consumers,
according to an adjustable bed base
study conducted by Furniture Today.
And most consumers say their adjustable
bed bases have helped them
with their health concerns.
Those findings underscore the importance
of making a better health connection
with consumers when they are
shopping for adjustable bed bases.
The study examines key views held
by retailers and consumers, thereby
helping savvy retailers do a better job
of meeting their shoppers’
needs.
Purchase prompts, a key
issue addressed in the consumer
portion of the study,
are important because they
help retailers zero in on the issues
that motivate consumers
to take action.
“Health concerns” were cited by
39% of the consumers surveyed,
about the same percentage (38%) of
consumers who cited “increased comfort”
as their purchase prompt.
The third most important purchase
prompt is a desire to better enjoy
watching TV or reading. That was
cited by 16% of consumers.
Recommendations from family or
friends prompted 6% of consumers to
purchase an adjustable base, the survey
found.
What are consumers looking for
in their adjustable bases? The survey
laid out a laundry list of key features,
with durability leading the list, cited
by 95% of consumers.
Price, cited by 88% of consumers,
and warranty, cited by 87% of consumers,
were next on the list, followed
by the number of position functions,
cited by 77% of consumers, safety
features, cited by 66%, and the fact
that the bases are made in the United
States, cited by 58% of consumers.
Brand names were well down the
list, cited by 54% of the consumers.
The survey also found that a majority
of consumers — 65% — purchased
their adjustable bed bases in a
store, with 35% buying online.
Three in 10 of in-store buyers
said they researched the products on
their smartphones while shopping. Of
those, most — 82% — were looking
at prices.
The survey also found that satisfaction
rates for adjustable bed bases
are very high, with 95% of consumers
saying they are satisfied or very satis-
fied with their adjustable bases.

Mattress retailers see more growth ahead for adjustable bases

HIGH POINT — Looking for a hot sleep
accessory to add sales zip to your bedding
department? Look at adjustable
bed bases.
That’s one of the key findings of
a new research study conducted by
Furniture Today that examines the
adjustable bedding segment, noted by
bedding veterans as one of the industry’s
fastest-growing categories.
The study confirms that thinking,
noting that about 80% of the bedding
specialists and furniture stores responding
to the study said adjustable
bases are, indeed, the fastest-growing
sleep accessories segment on their
sales floors.
And, significantly, the retailers
overwhelmingly said they expect the
growth parade to continue this year;
79% of the furniture stores and bedding
specialists say they expect their
2018 sales of adjustable bed bases to
be higher this year than last year.
The category was a big winner
for those retailers last year, they said.
Almost seven in 10 furniture stores
(67%) and 100% of the bedding specialists
said their adjustable bed base
sales last year were higher than in the
previous year.
The survey found that furniture
stores are doing a better job of adding
adjustable bed bases to their mattress
sales than are bedding specialists.
While the adjustable bed attachment
rate was a very respectable 50% at
furniture stores, the attachment rate
was somewhat lower — at 38% — for
bedding specialists.
The survey lays out a roadmap for
adjustable bed base best-sellers.
It reveals that the lowest-reported
best-selling price point for furniture
stores was $599, with a median of $899
and with the highest-reported bestselling
price point at a hefty $2,199.
Bedding specialists, meanwhile,
did better at lower best-selling price
points but not as well at higher price
points. The lowest-reported bestselling
price point for bedding specialists
was $799, with a median of $899,
and the highest-reported best-selling
price point landed at just $1,000, far
below the high-end performance generated
by the furniture stores, the survey
said.
The survey also identified keys to
selling adjustable bed bases.
Among the keys cited by furniture
stores: demonstrate the benefits without
trying to push the sale and position
the products as “power bases.”
Among the keys cited by bedding
specialists: address health and lifestyle
issues and explain how adjustable
bases meet those needs, and advertise the category “relentlessly.”

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