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posted by martyb on Tuesday April 03 2018, @08:05AM   Printer-friendly
from the Great-question!-Let-me-sleep-on-it-and-I'll-get-back-to-you. dept.

There's an article up on Curbed which looks into the surprising number of online mattress-in-a-box companies that have been starting up recently:

Since Casper launched its "mattress in a box" concept in 2014, digital-savvy entrepreneurs have been launching new mattress brands online seemingly every week. Each offers a state-of-the-art mattress made with patented new materials or an innovative design, all compressed into a small box for easy shipping right to your doorstep.
...
It's hard to know just how many online mattress-in-a-box companies are floating around, but one such company's CEO said the number could be as high as 150. Another said the number of mattress manufacturers, which are rarely the startups actually marketing the mattresses to consumers, is close to 500.

Ideally, a mattress is something you buy once every eight to 10 years, when an old one wears out or a major life event like getting married creates a new household. One can find a quality mattress for around $1,000. Given this is a relatively affordable, infrequent purchase for most households, why do so many companies see an opportunity in the online mattress space?

The article covers the reason for the explosion in the number of these companies, the economics and supply chain behind them, and the longer term survival prospects.

Originally spotted on Hackernews.


Original Submission

 
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  • (Score: 4, Informative) by driverless on Tuesday April 03 2018, @11:13AM (7 children)

    by driverless (4770) on Tuesday April 03 2018, @11:13AM (#661894)

    My guess is that mattresses have a really high profit margin from materials/labor to sales price.

    You're almost right there. Mattresses have an insanely high profit margin, think $1,000-2,000 or more for a product that costs $50 or less landed. Also, everyone in the supply chain gets to punch the ticket for their share of the revenue, and you can make any outrageous claim you like about your product and no-one will call you on it. What's surprising me is that there are so few mattress companies out there, given the profit margins and the money to be made.

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  • (Score: 1, Interesting) by Anonymous Coward on Tuesday April 03 2018, @02:39PM

    by Anonymous Coward on Tuesday April 03 2018, @02:39PM (#661961)

    What's surprising me is that there are so few mattress companies out there...

    TFA says there are lots of startups trying to shake up the industry with new business models. Time will tell if they are successful.

    ... given the profit margins and the money to be made.

    In the traditional retail-store model, there probably isn't actually a lot of money to be made. As TFA says, most people do not buy very many mattresses during their lives.

    I would not be surprised if a typical mattress storefront has a median daily sales volume of zero.

    This naturally leads to high margins on the product because the cost of the product is not a significant cost of doing business.

  • (Score: 0) by Anonymous Coward on Tuesday April 03 2018, @04:11PM (2 children)

    by Anonymous Coward on Tuesday April 03 2018, @04:11PM (#662019)

    Who pays that much for a mattress? My previous mattress was only about $700 14-ish years ago and is going in my guest bedroom more or less good as new. My new mattress that I'm getting today, was only $550 including shipping and is probably just as good as the previous one was.

    These mattresses probably do have high margins, but they can't possibly be making that much money when most of the mattresses I see are retailing for less than that. If people are paying that much for a mattress, they're getting cheated as a good quality memory foam mattress is just not that expensive to make or buy.

    • (Score: 2) by driverless on Wednesday April 04 2018, @01:37AM (1 child)

      by driverless (4770) on Wednesday April 04 2018, @01:37AM (#662287)

      Who pays that much for a mattress?

      Ask your family, neighbours, non-geek cow-orkers. You spend a third of your life asleep, a good night's sleep is critical to your wellbeing, are you going to skimp on getting the best sleep you can get, you need our patented bio-symbiotic all-natural metamaterial scientifically proven clinically tested megapedic doctor-approved polymaximegalonic mattress, usually $7,500, but yours today only for $6,500 in ten easy instalments, just sign here, here, and initial there.

      You can't make a claim too outrageous or charge a price too high for a set of springs and some ticking.

      • (Score: 1) by anubi on Wednesday April 04 2018, @06:35AM

        by anubi (2828) on Wednesday April 04 2018, @06:35AM (#662378) Journal

        Notice how all the marketers have slightly different product variations so its damn near impossible to price compare an exact item?

        Sure, they all say "Serta" or "Sealy", but its always some custom variant name, and all the salesmen always claim the cheaper one his competitor is selling, is, well ... cheaper made. Race to the Top Price. Or sleep on an "inferior" product. Not much way for me to verify what I am actually getting.

        Like you say, a $50 item, retailing at $1000. Like a HallMark card... gotta "care enough to send the very best". Even if its a scrap of paper. It makes it quite clear to my recipient that I am quite loose with my money...

        --
        "Prove all things; hold fast that which is good." [KJV: I Thessalonians 5:21]
  • (Score: 0) by Anonymous Coward on Wednesday April 04 2018, @02:47AM (2 children)

    by Anonymous Coward on Wednesday April 04 2018, @02:47AM (#662309)

    My kids and I play a game while driving around. We look for Mattress Firm stores. We've found two in the same shopping center. We've found them where you can see the next one from the parking lot of the first. We've found stretches of road with too many Starbucks and even more Mattress Firm stores.

    It got so crazy, we started going in to see what the big deal is. Inside we typically found two employees, twiddling their thumbs waiting for someone to walk in.

    I happen to own a toy store. I understand the realities of retail. They absolutely have to have an insane profit margin to make this work.

    My mattress? I got the Costco foam mattress and added the memory foam topper. Love it. Paid about $600 total. Still feel like I paid too much.

    • (Score: 2) by toddestan on Wednesday April 04 2018, @03:07AM

      by toddestan (4982) on Wednesday April 04 2018, @03:07AM (#662314)

      It seems like when some retail store in a strip mall or stand-alone building goes under in a not-so-desirable location, there's a decent chance a MattressFIRM will pop up in its place. I've always assumed that they survive because they are paying almost nothing for rent.

      I thought it was pretty crazy that there is literally two of those stores within easy walking distance of my house (they are less than a mile apart, and my house is between them). But I guess maybe that's more common that I would think. One of them also has every light on the store on no matter what hour of the night I go by.

    • (Score: 2) by driverless on Wednesday April 04 2018, @04:35AM

      by driverless (4770) on Wednesday April 04 2018, @04:35AM (#662342)

      My kids and I play a game while driving around. We look for Mattress Firm stores

      Are you sure one of them isn't a Mattress Soft? They're visually quite similar.