Our Terms & Conditions | Our Privacy Policy
HIGH POINT — The mattress industry has witnessed significant consolidation in recent years, with major players pursuing mergers and acquisitions to enhance their market positions.
While such consolidation can lead to increased efficiencies and expanded market reach, it also raises concerns about reduced competition and potential negative impacts on consumers. With merger and acquisition activity in hyper-overdrive throughout the home furnishings industry, the landscape of the bedding business is shifting.
The industry’s largest deal — Tempur Sealy International’s $5 billion acquisition of Mattress Firm — has been grabbing headlines, but other deals continue to make change the segment’s landscape. The deal, announced in May 2023, closed earlier this month following a seven-month court battle with the Federal Trade Commission.
M&A at a pace
Since 2020, the bedding category has seen about 25 mergers or acquisitions ranging from Purple Innovation’s acquisition of Intellibed, to Corsicana’s acquisition of Symbol Mattress, to Ashley’s buy of Resident Home last year.
More recently, 3Z Brands added a fourth company to its stable through the acquisition of Southerland. The traditional mattress company joins Bear, Nolah, Leesa, Helix and Brooklyn Bedding under the 3Z umbrella.
Ashley acquired Resident Home last year, and Carpenter Co. notched its third acquisition in just over a year with the Casper deal. That move followed the company’s acquisitions of NCFI and Belgium-based Recticel, an engineered foam company, in 2023.
Sleep Country Canada picked up Casper’s Canadian operations in early 2023 before the sleep retailer was acquired by Fairfax Financial and taken private last year.
Also in 2023, Bedding Industries of America merged with Saatva, and since then, the bedding business has continued to consolidate with a variety of deals.
Mergers and acquisitions are in hyper-overdrive, carving out a new landscape with the industry’s largest companies getting larger and smaller companies banding together to remain competitive.
Consolidation ‘inevitable’
Proponents of big mergers and consolidation point to economies of scale, cost savings and enhanced innovation through pooled resources and talent. Opponents say reduced competition leads to higher prices and fewer choices for consumers, as well as job losses as companies move to streamline operations.
Industry consolidation is “inevitable,” according to Frank Hood, president and CEO of Kingsdown. “It makes sense as a means for business development and a way for some of these companies to grow.”
Jeff Hutchings
“Everyone is looking for a dance partner, and that’s not always a positive for the consumer,” said Jeff Hutchings, chief innovation officer with Purple. “The consumer benefits when there’s a lot of competition and choice in the marketplace. Today, consumers have fewer choices.”
When Purple entered the mattress space in 2016, the industry was prime for disruption. Casper had just launched; Avocado was a play in the boxed bed segment; Tuft & Needle was in the category; and Resident came on board in 2017.
“Disruption brings about innovation,” Hutchings said. “In our heart of hearts, we know our technology is different. Innovation happens by lean companies. The larger you get, the less nimble you become. We can still be nimble.”
Brad Rogers
Brad Rogers, senior vice president of bedding for Ashley, views the industry consolidation as a part of the normal flow of business, and as an executive for one of the companies that recently made a big play in the sector with its acquisition of Resident, he sees mergers and acquisitions as a positive for innovation.
“I see a weeding out process. The industry is constantly changing. Consolidation allows for more innovation,” he said, adding that combined resources can enhance product development, creative thinking and more.
David Binke
David Binke, CEO of King Koil, agrees. Last Spring, King Koil’s longtime owner KPS sold the company to AI Dream, a division of Hillhouse Investment Management.
“This is part of the natural business,” he said. “For some companies, it’s good; for others, it’s not. We’re a stable company and not concerned.”
Winning and losing
The ongoing consolidation can offer challenges for other companies to compete in such A business environment.
Nick Bates
“As big companies merge, it makes it more challenging to compete,” said Nick Bates, president and CEO of Spring Air International, adding that his company continues to develop new products, innovate and stay ahead of his competitors.
Richard Fleck, president of Paramount Sleep Co., agrees that the ongoing mergers impact competition negatively.
“Consolidation bodes well for Tempur Sealy, Serta Simmons and 3Z Brands. For everyone else, it makes it more costly and more challenging to compete, and ultimately, gives customers fewer choices,” he said, adding that it could stifle innovation.
Richard Fleck
“As far as innovation is concerned, the majors will be more focused on efficiency than innovation. When you look at all the innovative things that have developed in the industry, they predominantly have come from family-owned businesses or smaller organizations that must compete on innovation and finding new ways to create things,” Fleck said. “Smaller companies don’t win on efficiency and marketing scale. Instead, innovation is at the heart of what they do. We must have a sharper nail.”
He pointed out that Paramount’s licensing model with international manufacturers, such as Hypnos and A.H. Beard, puts them at the forefront of innovation though shared merchandising and marketing philosophies.
Bill Hammer
For Shifman Mattresses, the abundance of consolidation in the bedding category is a benefit, said Bill Hammer, president.
“We benefit in a couple of ways,” he said. “Our product stands out more and more as other brands become more of the same, and we benefit by capturing retailers that are looking to differentiate themselves in the marketplace.”
Mark Quinn
Mark Quinn, senior vice president of sales and marketing for the family-owned brand, jumped in saying that it will fall to retailers to choose with whom they choose to do business.
“Retailers will need to decide what kind of relationship they want from their partners,” he said. “Do they want to deal with companies that are dictatorial in their approach, or deal with a family-owned business that is nimble, hungry and grateful for their partnership?”
For Jon Stowe, managing director of E.S. Kluft & Co., he sees big deals opening paths for smaller, creative thinkers to enter the category and create some noise. He pointed to MD Mattress out of Texas and Sandman Bedding Co. based in Mississippi as two manufacturers that are building strong networks in the business.
Jon Stowe
Generally, Stowe said he sees the ongoing consolidation as a positive for the luxury mattress maker’s business, and that — as with any industry consolidation — winners and losers come out on the other side.
“This (Tempur Sealy/Mattress Firm) deal will be good for me,” he said, adding that his brands are not on Mattress Firm’s floor. “We’re very strategic in our partnerships. The general consensus among retailers that we speak with is that they aren’t happy with this deal.”
Images are for reference only.Images and contents gathered automatic from google or 3rd party sources.All rights on the images and contents are with their legal original owners.
Aggregated From –
Comments are closed.