Basic bedding battling blandness
Marvin Lazaro -- Home Textiles Today, November 18, 2002
The world of basic bedding has become anything but basic as manufacturers and suppliers not only struggle with cautious consumers but with retailers they believe may not fully understand the products they are offering.
The basic bedding segment has progressed far beyond the issue of whether natural fills are better than synthetic. Different types of foam in different densities, coupled with synthetic and natural fill have all entered the picture, as have various down alternatives and advances in synthetics.
All of these developments have jump-started a rapidly growing basic bedding market. However, problems in merchandising and presentation are cropping up as vendors struggle to differentiate themselves from their competition in a swiftly expanding sea of white.
In general, specialty chains earned acclaim from suppliers for presentation of products and breadth of assortment. It's an easy win, noted David Roshberg, national merchandise manager for Louisville Bedding of Louisville, KY. "They just carry more stuff."
CAPTION: United Feather & Down is offering diverse pricing with its licensed Joseph Abboud Home and Chereskin Home lines.
Said Dave Stewart, executive vp for West Long Branch-NJ-based Sleep Innovations, "They seem to be grasping the concept of giving consumers logical choices and communicating those choices. They're making it easier for consumers to make purchasing decisions."
But specialty has competition. Jeff Hollander of Hollander Home Fashions, based in Boca Raton, FL, lauded the discounters.
"I'm seeing streamlined, logical presentations at the mass level," he said, "and too much duplication at department stores and specialties. There's less confusion to the consumer at the discount level."
His comments were echoed by Perfect Fit Industries' vp of sales and marketing, Bill De Piazza, who said discounters' presentations were "focused, with a much clearer picture of who their customers are."
WestPoint Stevens' Alan Kennedy, vp of sales for mass specialty retailers, is in agreement. According to Kennedy, discounters "have refined the mix to maximize dollars per square foot and not confuse the customer."
Conversely, he added, the specialty chains "are over-assorted in the pillow classification, but need in-store merchandising to help their customer understand the natural classification."
Catalogers, some noted, are also doing a commendable job merchandising their assortments. Bob Hickman, vp of sales and marketing for the Des Plaines, IL-based United Feather & Down, said, "They create the perfect picture for presentation and they identify all the key benefits and features."
Said Mike Gannaway, president of the Fort Mill, SC-based Pillowtex, "Catalogs have the advantage of speaking to consumers in the comfort of their own home and can use the space to tell a story with photography and creative copy. Retailers often focus so much on the thread counts and other specs that they lose sight of what the consumer really wants."
CAPTION: Hollander Home Fashions is emphasizing added value with an insert as part of its pillow packaging.
Conversely, department stores topped almost everyone's 'needs most improvement' list. Many noted the lack of sales associates, or lack of associates themselves, who were knowledgeable about the product they were presumably selling as well as the channel's merchandising rigidity, adhering to a corporate directive to follow a 'model' store.
Dan Schecter, vp of the Richmond, VA's Carpenter Co.'s sales and marketing for its Consumer Products Division, felt a lot improvement was necessary across the board, specifically relating to the technology behind the product.
"I don't think any retailer is really optimizing the category," Schecter said, "because it's just a bunch of white squares with pretty packages. Nobody is selling sleep and they're not selling the benefits of the products. I don't think retailers understand the opportunity to make more margin by keying in on what's important to consumers — getting better sleep."
Another issue concerning basic bedding vendors is the number of auctions taking place. Few, if any, had kind words for the process. Most said auction activity had increased in 2002 and would continue to do so. Kennedy said the auction activity for this year was too high as most major retailers conducted at least one. Springs Industries' Ted Matthews, vp of corporate communications, said the company has also seen more auction activity lately than in previous years. "It's a phenomenon we're learning to deal with," he said, adding that auctions pose "challenges" to suppliers "to continue to offer good programs with better value and continue to be able to realize a reasonable return on our programs."
CAPTION: Louisville Bedding is hoping to attract latex foam users with a Talalay foam offering as a result of its agreement with Latex Foam International.
What perhaps disturbed manufacturers most about auctions was the elimination of several factors by retailers such as past performance and working relationships. Factors which would normally play a major role in the ability of a company to place a program are now being rendered "meaningless," many suppliers said.
"It's a damaging, harmful trend to the entire industry because it prioritizes price over quality and partnership and product innovation," Hickman said.
"Unfortunately quality will eventually be compromised because of them. That's my biggest concern," said Hollander's Beth Mack, vp of the basic bedding division. Jeff Hollander said new twists have also been added to the process, such as 'handicapping.' According to him, retailers are building in several factors when they acquiesce to accept a vendor's program. In other words, a pillow which would normally wholesale for $10 is being brought down to $8 in anticipation of potential logistical problems.
"It's just awful. They focus in on price, but here, there's a lot more to it than just that," said Brad Sharpe, senior vp of Foamex International's Consumer Products Group. He, too, felt that inferior products would be the unavoidable result.
"Auctions are forcing vendors to dissolve margins," summed up Lonnie Scheps, vp of sales and marketing for Hudson Industries of Richmond, VA. "It's the power play of fewer retailers having greater muscle."
Just like its fashion bedding counterparts, basic bedding is undergoing major changes due to global sourcing. Depending on the manufacturer, everything from the fill to the cover is now coming from overseas.
"It's the future," said Andy Payne, vp of sales for the Loveland, OH-based Down Lite International. Down Lite "is sourcing more from overseas than ever before, both raw materials as well as finished products."
What may be driving manufacturers to go to such countries as China, India and Pakistan more often is not only lower labor costs and better quality but the ability to find certain products there that are no longer available in the United States such as down-proof fabric. Hickman said global sourcing had benefited United Feather significantly since it gives the company the opportunity to view competitive situations and fabric opportunities from around the world and to get a global sense of the technology used by international manufacturers.
De Piazza said the need for higher fabrications, thanks to the upswing of demand on the fashion side, has made manufacturers look elsewhere in order to remain competitive. "The addition of the California Feather business is only pushing us more down that road because of the nature of that business," he said.
Even the major mills are not immune to the appeal of generally higher quality, lower-priced goods from overseas.
CAPTION: Adding fashion is part of Down Lite International's strategy with its licensed Croscill line.
According to Gannaway, Pillowtex has been taking advantage of overseas suppliers for 25 years, so the recent surge was not unexpected. Kennedy said an increasing number of shells are made overseas and imported to be filled due to inventory control issues and the ever-present quotas.
"I'd love to buy domestically, but it's a lot cheaper going to China," said Sharpe.
While foam manufacturers may not be getting their foam from overseas suppliers yet, they are getting their covers and ticking from there. But eventually, Stewart and Sharpe said, an increasing amount of foam is going to come from offshore as a result of advances in technology.
While the effect of global sourcing is generally seen to be positive, Schecter issued a warning.
"It's buyer beware out there. The cheaper you buy, the cheaper you get," he said.
Another factor driving basic bedding manufacturers is innovation. Unlike fashion bedding, which centers mainly upon how good a product looks, basic bedding is driven by comfort. Hence, applying science and know-how is no small measure in pursuit of the hot-selling item that every consumer has to have.
According to Roshberg, Louisville, which divides its assortment into four segments — luxury, basic, solutions and promotional — is focusing its efforts and growth on the luxury and solutions-based areas.
Generally speaking, some suppliers contend that the innovations in basic bedding would center upon improvements to existing products, i.e., higher thread count covers and ticking, while others cite the relatively recent rise in the fashion element of the business, as well as the movement toward therapeutically-shaped items. Schecter said California's new fire retardancy laws should spark the next wave of innovation as companies scramble to develop products that comply.
CAPTION: Sleep Innovations is touting its Novaform Gel line as the latest in basic bedding.
Jeff Hollander said manufacturers must listen to what consumers want before taking on development costs because "you can introduce the greatest product in the world in your mind and not be successful because it's not what consumers think they want."
Hickman brought it back to product development. "Innovation is our salvation. It's the future. It's our job to analyze the marketplace and assess consumers' needs and deliver a fairly priced, high quality product to them."
Another issue affecting basic bedding suppliers is the amount of promotional activity conducted by retailers. Using bargain prices to drive traffic may ring cash registers in the short term, but in the long-term suppliers believe the practice may be undervaluing their products.
"Retailers need to go back and re-look at their assortments. They have a lot of products that are undervalued," Roshberg said. "There are other ways to grow business than by pulling the price trigger. Price is not always the first thing consumers are looking for."
Said Payne, "If you convey quality and value in a product, then price isn't a selling strategy."
Price may not be a selling strategy but 'magic' price points continue to be a major part of the business. More than one manufacturer noted, however, that some of the higher price points items are selling better than those products on the lower end of the scale. The magic point for synthetic pillows, despite advancements in fill and generally better construction, remains at roughly $9.99. A down and feather pillow is thought to be between $25 and $30, while the average for higher-end foam constructions fell around $25. Mattress pads follow the same trend.
"Within each classification there is a top and a bottom end," Scheps said. "But we are finding that higher-end products are selling better and the cheaper are not."
Said Kennedy, "We have done a decent job of convincing the retailer and consumer that more is better and there is a price value equation."
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