Summary
Mark and Mike discuss the growing wave of mattress and furniture retail closures from 2018 to 2026 and the strategy it takes to fight through and even thrive in these market conditions.
Key Take-Aways
Retail closures are accelerating. Mike tracked retail chain failures from 2018 on. With big names like Bed Bath & Beyond, Hudson's Bay, and Sleep Number, the slide gets more crowded every year.
Closures are shifting from restructuring to full liquidation. Several 2026 filers, including American Mattress, went from Chapter 11 to shutting everything down within weeks. Sleep Number was the exception, as it was acquired out of bankruptcy.
Moving away from promotional pricing costs retailers customers, not just units. Retailers can't afford to give up low-end mattresses to online stores like Amazon and Wayfair. The real loss is the customer. Someone who buys online today might not come back when they're ready to buy a premium bed — a looming downstream effect.
The “$199 Queen” no longer attracts shoppers into stores. Cheap imports are a Google search away, so a low price no longer creates urgency. Manufacturers are also finding it harder to offer promotional products that retailers can advertise to get people in.
The problem is structural, so waiting it out won't work. This is a long-term secular decline driven by big outside forces, not something to survive until the midterms or a housing recovery.
Retailers need a long-term reason to exist. Committing to strategies like, The Four C's of Retail (curation, customer service, convenience, community) across marketing, staffing, merchandising and/or execution and selling intangibles like sleep, well-being, and in-store experiences can provide tailwinds for retailers.
Survivors may gain share, but the market is still shrinking. Aggressive operators like Mattress Warehouse are opening stores through the downturn and picking up business from closed competitors. Despite this, it’s important to note that this is a shrinking pond, so even winners shouldn't get complacent.
Show Notes
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