The crazy competition to get Americans to bed is driving the mattress industry into turmoil.
As America\'s largest mattress retailer struggles with falling sales and a bankruptcy threat from the parent company\'s financial scandal, the mattress company is waking up because of a hangover. Meanwhile, bed-in-a-box e-
Commercial companies-after many companies have emerged in recent years, there are now dozens of them-are planning bricks --and-
Mortar position
However, in a competitive environment, they face their own survival challenges.
Excessive expansion is at the heart of the industry\'s troubles.
There are more places to buy mattresses in the United States. S.
Instead of buying a Big Mac.
With fierce business competition generating deals, price transparency and improved customer service, consumers may be the ultimate winners.
But the downside is a lot of store openings and more threats.
In the face of sales decline, no. 1 U. S.
Mattress retailer Mattress is closing hundreds of stores and scrambling to strengthen its digital business.
At the same time, the retailer\'s parent company, Global Enterprise steininternational International, was involved in an accounting scandal involving billions of dollars in balance --
Paper errors that caused its stock to plummet in less than a quarter.
The company is currently considering bankruptcy, Reuters reported.
A company spokesman was unable to discuss the report immediately on Tuesday.
Kyle auusu, senior non-performing debt analyst at Reorg Research, said: \"I don\'t think the liquidation will end, but with that being said, you can see a document that tracks the people who are in the crisis in Steinhoff.
\"I don\'t even rule out the filing of US mattress company entities. S.
Try to implement the restructuring plan.
\"More money: The Amazon pharmacy should derail the money for\" ridiculous \"Cino, courier deals, Carl Icahn sayesmore: no need to buy Cadillac, Mercedes
When you can simply subscribe for more money, Mercedes or Volvo: The FDA has expanded its recall of heart drugs that may have cancer
The consequences of falling mattress company sales and increased competition in the industry are leaving debris.
Industry leaders say disruptive discounts are on the rise while costs-
Especially the cost of goods and marketing
Also increasing.
For good or bad, online sellers have caused a lot of turmoil.
Companies like Casper offer popular no-
Good price, easy to order, free shipping, month-
Long-term trials and new technologies like advanced memory foam.
David Wolfe, CEO of online mattress company Leesa, said online sellers are actively supporting digital marketing spending and discounts.
He warned that some sellers were compromising quality in order to reduce costs.
\"The Madness of traditional retail has now moved online,\" Wolf told USA Today . \".
Scott Thompson, CEO of mattress manufacturer and seller Temur Sealy International, told investors in late July that the mattress company\'s \"irrational promotions\" were \"unsustainable \".
\"We see more competition for bedding, some new pieces focused on increasing sales at any cost, and are willing to lose a lot of money, thompson said in an email reply to USA Today.
\"I think this will continue as long as investors are willing to fund losses.
\"Market instability comes at an untimely time for struggling strip shops and mattress suppliers who celebrate the industry\'s recent growth while other retailers are in trouble.
Number of us. S.
According to IBISWorld, stores selling mattresses increased by 32% to 15,255 from 2009 to 2017.
McDonald\'s, by contrast, has $14,079. S. stores.
Casper CEO Philip Klimm, who predicted a wave of store closures in the mattress industry, said his company would make a profit by opening \"hundreds\" of its own stores.
\"There will definitely be a retail reshuffle, and what you see is that a lot of dollars are online,\" Krim said . \".
If so, the mattress company could lose the most.
In recent years, mattress companies have expanded their size through a series of acquisitions-mattress Giants in 2012, sleep trains in 2014 and sleep trains in 2016.
On the whole of the United StatesS.
Location, mattress company has more shops than the land section
According to the National Retail Federation, Sonoma has merged.
Now, Houston.
The stanhof-based division is ahead of the industry with a market share of 33.
According to IBISWorld, 6%, more than three times the number of recent competitors.
As of March 31, the mattress company had 3,304 stores, after closing 248 stores in the three financial quarters.
After acquiring the retailer in September 2016, Steinhoff began renaming its store as a mattress company.
Mattress Company sales fell 10% and 6% in the last two quarters, respectively.
In the first half of fiscal 66%, its operating loss expanded by 0. 133 billion to $2018.
\"Obviously, the risk is that as everything starts to go live, you have too much real estate,\" said Owusu of Reorg . \".
Recently appointed mattress company CEO Steve Stana responded to USA Today ahead of Tuesday\'s potential bankruptcy report, acknowledging that the store was closed because there were too many stores in some places after the acquisition
\"This is not a matter of closing the store,\" Stagner said . \"
\"This is about optimization, re-
Positioning and leveraging our retail footprint and brand presence also extends to our digital strategy.
MeghanGuattery, retail analyst at IBISWorld, said that most consumers still want to buy mattresses in person.
\"They want to walk into a mattress shop, take off their shoes and feel where they will spend every night,\" she said . \". Bed-in-a-
Box retailers recognize this.
After a few months of use, startups have gained momentum by offering limited options, simple online ordering, savvy marketing and free returns.
But several major online mattress retailers have launched solid mattresses. and-
Physical stores or deals with other retailers to sell mattresses in person and realize that this is the best option for them to grow.
Casper already has about 20 stores, one of which is located in New York City, opposite the location of the mattress company.
\"If you have the opportunity to enter both areas at once, you will see clearly where the industry is and where it is. . .
Krim, CEO of Casper, said.
\"We still see a lot of opportunities to expand our footprint.
Leesa CEO Wolfe said his company also plans to add more stores outside of the two locations currently operating.
The company\'s mattresses can also be tried out in Williams.
Sonoma West Elm shop
Wolf predicts that the market share of online sellers will grow to 10% in three years from about 25% today, meaning sales will increase by about $2 billion.
This is partly due to the urgent need for alternatives, he said.
Traditional mattress shops offer an \"uncomfortable environment\" in which price and product information is confusing, especially when women are often watched as they try their beds, Wolf said
\"The retail experience has to change,\" he said . \"
\"I think the new brand is more likely to deal with this issue than the old one.
\"The fierce competition in the industry has also dragged down mattress manufacturers.
On 2017, the mattress company abandoned the supply agreement with Tempur Sealy and signed a five-
Make an annual deal with rival Serta Simmons.
Sales in the first six months of 2018 fell sharply. Between $ 6% and $1.
32 billion, in part, was injured by the contract loss of the mattress company.
Tempur Sealy still gets $9 of $10 from mattress sellers and is now looking to open a new store to sell more products directly to customers.
It\'s been opened about twenty more Tempur-
Pedic stores in the United StatesS.
There are currently about 36 locations.
The plan is 40 to 50 by the end of the year.
Since winning the contract with the mattress company, Serta Simmons has not performed as well as it hoped.
Mattress\'s recent woes prompted S & P Global Ratings to reduce Serta\'s credit rating from B to B. .
The Serta Simmons media representative could not be reached for comment.
\"We are confident that the mattress industry will continue to withstand pricing pressures from foreign imports and online manufacturers,\" S & P Global Ratings said in a report . \".
For the mattress company, the future is shrouded in the financial scandal of Steinhoff, which has more than 40 brands in the fields of household goods, clothing and car dealers.
Steinhoff acknowledged in a public document that the company faced allegations of \"accounting irregularities.
The disclosure triggered a financial crisis that raised questions about the company\'s solvency.
Steinhoff\'s mistakes include exaggerating how much cash it has and improperly calculating the International Monetary Fund.
Owusu of Reorg Research said the company\'s loans hurt the company\'s financial situation.
In many other adjustments, Steinhoff was forced to write on his balance sheet about $1 worth of mattress companies. 9 billion.
This includes about $0. 3 billion in \"heavy lease terms\" related to \"loss shops\"
Made, worn or above
Market rent, according to a document.
Steinhoff andMattress declined to comment.
The PricewaterhouseCoopers auditor is currently conducting a forensic investigation of the company\'s finances, so it is difficult to accurately assess how radiation affects the operation of the mattress company.
While Steinhoff has recently negotiated an agreement with certain creditors to have a few years of breathing room to restructure its business, Owusu reiterated that bankruptcy is still possible.
Follow US reporter Nathan Bomey Twitter @ NathanBomey today.
