How The Bedding Industry Is Responding To The Global Pandemic

As the efforts to contain the COVID-19 pandemic are ramping up across the country and the globe, people are starting to feel the impact in every aspect of daily life. And the bedding industry is no exception. With stores being ordered to close and people taking the necessary precautions to stay home, bedding companies are preparing for difficulties ahead. With so much uncertainty surrounding this issue, we wanted to take a careful look at the pandemic’s impact—how it has already begun to affect our industry and predictions for how it may continue to play out in the months ahead. While the current outlook may seem bleak, there are still bright spots—from new innovative solutions that will hopefully alleviate some of the disruption to instances of manufacturers stepping up to lend a hand where they are needed. As the crisis continues, we hope to continue to serve as a valuable resource for bedding retailers and manufacturers as they forge ahead and plan for their future. 

The Initial Response

Last week, Nationwide Marketing Group conducted a quick initial survey of its members to get a snapshot of how the independent retail industry was reacting to the crisis—and then today released the findings from a follow-up survey. With more than 460 retailers responding to the first survey and 633 to the second, the group found a somewhat varied range of insights that have evolved over the past week.

Unsurprisingly, in-store retail has been most affected: 52% of survey respondents reported a significant decrease in foot traffic. And yet, more than half of respondents were also reporting that their year-over-year comparable sales had still met or exceeded last year. Many stores have already begun making major operational changes to accommodate government directives and ensure the safety of their customers and employees. This included enhancing the cleaning and sanitization processes in-store and adopting social distancing practices during internal meetings and interactions with customers. Others were working on implementing new precautionary measures around deliveries, including wearing gloves and shoe covers, mandatory hand sanitizer use and calling customers to ensure no one at home is sick.”

As the situation continues to grow more serious and widespread, more of these changes are inevitable. At the time of the first Nationwide survey, two-thirds of respondents planned to maintain normal operating hours and only 5% had completely shut down their stores. The second survey showed that now 42% of respondents have reduced store hours, with 13% voluntarily closing their stores with no government order to do so and another 8% saying they plan to do so soon. Of course, the realities of the pandemic have evolved drastically in the days since this survey was issued—prompting more businesses to close their doors, whether voluntarily or as a result of newly implemented directives.

Is Your Store Essential?

As a number of states have issued “shelter-in-place” rules, there has been some discrepancies as to whether or not mattress stores are classified as an “essential business.” This generated a dispute between one Illinois Mattress Firm location and the local government. Last weekend, the Champaign-Urbana Public Health District issued the retailer a cease-and-desist order after the store remained open despite the new stay-at-home orders going into effect. The confusion came from a discrepancy over what constitutes a “household consumer good,” as businesses that sell those products have been deemed essential and are allowed to remain open.

“The order specifically names businesses that sell household consumer products, as well as products that are essential to the operation of a residence, as essential retail,” said Mattress Firm CEO John Eck. “We feel confident that sleep is an essential function of a home, especially during times of high stress and anxiety.” The local health district administrator Julie Pryde disagreed—saying that the store location was allowed just “one employee in for online orders.”

Eck argued that the low-volume nature of their locations allowed them to more easily sanitize and enforce social distancing rules, but other mattress shops have taken a different viewpoint. Tom Bender, owner of nearby Bender Mattress Factory, has already closed up shop and plans to stay that way for the duration of the stay-at-home order. “People can lay down and leave the virus on the mattress,” he explained. “It’s an intimate thing when you lay down on a mattress and put your head on a pillow.”

While many in our industry see mattresses and bedding a clearly essential household items, the nature of the in-store shopping experience poses clear difficulties in the face of these orders. More retailers should prepare for the reality that their physical stores may have to shutter in the coming weeks.

How This Will Affect Sales

Rather than put employees and customers at risk, many retail stores are closing their doors and hoping that their cash on hand is enough to ride out the duration of this shut-down. Mattress retailers in particular are already anticipating that the crisis is going to negatively impact sales in the coming months. According to Piper Sandler, a financial services company that conducts a nationwide mattress retailer survey each month, mattress retail sales are expected to drop by up to 20% in March. This comes at the heels of a strong February, a month in which survey respondents reported a 13.9% mean increase in total dollar sales.

Bedding retailers are in good company, at least. Over the last week, more than 47,000 chain stores have shut their doors—and that number does not even take into account the number of small retail businesses that have also been closed. Many of these retailers have pledged to stay shuttered for at least two weeks, but it’s possible that this could go on for much longer than that.

The Rent Problem

To weather their sales losses, many retailers are now trying to figure out a way to withhold or pay only reduced rent in April. While many states have issued freezes on mortgage payments, none have yet to address the issue of rent—leaving both retail tenants and landlords in the lurch as they try to figure out how to cover this cost with little to no revenue coming in.

Mattress Firm is one of these chains looking to halt rent payments. After initially asking landlords to cut its rent in exchange for longer leases, the retailer issued a more urgent plea this week and requested a temporary suspension of rent. The decline in revenue and forced store closures across the nation are more drastic, compressed and immediate than we originally anticipated,” the company wrote in a letter to Bloomberg—noting that its “need is now more severe” and categorizing the pandemic as a “force majeure” event that will prevent or prohibit it from paying rent.

According to this Bloomberg article, the “force majeure” declaration may be the answer for many retailers struggling to make rent. This contract clause covers “highly unusual events”—and could also, in turn, be issued by landlords in talks with their insurance companies. But it is still unclear whether or not this is a feasible solution—and experts are predicting an uptick in legal disputes between landlords and tenants if the government doesn’t step in.

New Solutions For How To Move Forward

Although initially expected to last just a few weeks, it is now looking like the widespread disruption caused by the pandemic could last at least through May. And the ramifications will likely continue well into the future.

The chances of everything simply going back to normal are slim. It is inevitable that the realities of life and business are going to be altered even after the virus is finally contained. While in some ways this is a stressful reality, it’s also highly likely that many will emerge from this crisis more aware of public health issues, perhaps a little scrappier and armed with innovative ideas for doing stronger and more resilient business. Rather than sitting back and hoping that all of this will just eventually go away, now is the time to start envisioning and preparing for a new normal.

Enhanced Virtual Tools

Already, there are companies that are introducing new tools and technologies to help companies adapt to this current moment. With furniture markets being canceled or postponed throughout the country, manufacturers are scrambling to find new ways to showcase their products for retailers—who, regardless of the uncertainties, still need to prepare for the year ahead.

Live Furnish is offering a valuable solution to this issue. Through rapid prototyping, 3D image production technology, the company is able to deliver high-quality, life-like photo renderings of products within a range of dressed room settings. This technology would allow companies to generate images without a physical product or in-person photoshoot. This provides manufacturers with a new way to showcase their products and engage with their clients via digital or printed platforms—which not only helps them safely continue their business efforts during this moment, but may offer continued value in the future as well.

“A digital furniture experience can help support market growth and retention while standard shopping and shipping are challenged, as they are now,” said Live Furnish Co-Founder, Preet Singh. With minimal production time and low cost per image, this technology is an efficient solution for companies who need to tighten their purse strings right now. As we eventually transition back to in-person sales, it could also help retailers introduce more product customization into their showrooms.

Invest In Ecommerce

While much of in-person retail has come to a stand-still, online shopping is still possible. According to the Nationwide Marketing Group survey, 76% of respondents said that their online traffic had either increased or remained steady in recent weeks.

If you are a retailer with a steady online presence, that should be where your energy is focused right now. Many manufacturers are doubling down on their ecommerce efforts and enhancing the digital resources they offer their retail partners.

And if you are a retailer that doesn’t have very robust ecommerce capabilities, now is the time to explore how you can expand into the category. Having an online sales presence, even if it’s a small selection of options, allows you to be nimble in times like these. And while the delivery logistics can make mattress orders difficult right now, smaller accessory items are easier to ship. Thoughtfully diversifying your business is a way to protect yourself from unforeseen difficulties such as this one.

How The Industry Is Switching Gears To Lend A Hand

Of course, in a moment like this, sometimes there are bigger things to think about than sales. It’s been heartening to see a number of industry players step up to offer their services where they are needed. Many bedding companies have the facilities and capabilities to manufacture in-need supplies such as protective face masks, hospital beds and ventilators.

Serta Simmons Bedding just announced that it will be donating 10,000 mattresses to New York City hospitals and medical facilities. Facilitated in partnership with Relief Bed International, the donation hopes to address the significant shortage of hospital beds the city is experiencing in the wake of the pandemic. The company is also pledging additional assistance as needed—noting that its factories and distribution network are capable of producing up to 20,000 beds per day.

Brooklyn Bedding is also offering up its manufacturing capacity to support healthcare facilities. The company has signaled to hospital and government officials that it is prepared to repurpose its innovative bedding technology in order to produce hospital beds. Originally developed for the trucking industry, the mattresses’ proprietary vinyl cover is made with creased corner seals to resist liquid permeability—ensuring the extreme waterproofing features needed by hospitals. Additionally, Brooklyn Bedding’s roll-pack processing allows for easy bed-in-a-box delivery direct to the hospitals and agencies in need, while on-demand production will help alleviate excess inventory.

Other companies are expanding beyond their normal manufacturing output to focus on other in-demand products. TDI Worldwide is spearheading an initiative to help other industry manufacturers to start producing masks as well—with many leading brands already committing to cause. With support and guidance from North Carolina Senator Tom Tillis, the group is currently navigating the approval processes for the US Department of Health and Human Services and the Food and Drug Administration (which require approval on both facilities and materials in order to certify the masks as medical-grade).

Eclipse International has also shifted its production to medical masks. Using some of the very same materials it uses in its mattresses, the company will produce an initial batch of 38,000 masks to provide to health care professionals. Eclipse has also shared the mask pattern, specifications and source information for the elastic with its network of 17 licensees throughout the country.   

What’s Next?

This is an unprecedented moment in our country’s history - and there are many questions that still remain about how this will continue to impact our daily lives. In times like these, it’s important to conserve your energy and focus it on tangible solutions.

Focus on what you can do to help. That includes doing what you can to stop the spread of the disease by washing your hands, closing up shop and staying home as much as possible. That also means looking for ways that you can help others, whether through financial assistance or product donations.

Start thinking about ways to innovate in the future. There is so much that’s still unknown, and even more that is out of our control. This makes it easy to feel helpless or fatalistic. Rather than succumbing to doom and gloom, try to accept that there will be questions with no answers for a while - and use this moment to think boldly about the future. When business as usual is disrupted so drastically, it can open the mind up to new, previously unimaginable opportunities. If you allow yourself to entertain those possibilities now, you just may be able to build towards them in the future.

Read more here, here, here, here, here and here.

This story first appeared in eNews. Click here to get Sleep Retailer eNews delivered straight to your inbox.

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