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Crain's Group Publisher Mary Kramer among Michigan Journalism Hall of Fame inductees Businesses along busy M-59 shopping corridor brace for 2-year road project Pistons, Olympia to split revenue from suite sales at Little Caesars Arena Businesses aim high with literacy program Retailers along busy M-59 shopping corridor brace for 2-year road project Crain's Detroit Business is a metered site. Print and digital subscribers have unlimited access to stories, but registered users are limited to eight stories every 30 days. After viewing three metered stories, you'll be asked to register or log in. After eight more stories in 30 days, you'll be asked to subscribe. U.S. Mattress awakens growth with new brick-and-mortar stores U.S. Mattress is looking to bricks to keep up king-sized growth for its mattress sales.The Brighton-based company hit $50 million in revenue last year, almost entirely from the online sale of mattresses. Now, it is adding new brick-and-mortar stores to capture customers who want to test their beds before they buy.
The company's plan calls for up to 20 stores in the region over the next several years — up from the two it has operated for a decade or more in Plymouth and Commerce Township. An outlet warehouse in Livonia is set to open Nov. 16, the fourth location it's opened over the past year. Between those locations and three more stores planned for the coming year, the company is making a $1 million investment to build out the leased locations, said President and CEO Joe Nashif, who founded the company in 2001. The local expansion will lay the groundwork to begin establishing a physical presence in states across the country, Nashif said. A decade ago, the company was still in its infancy and not in a position to open more physical locations, he said. "Fast forward to where we are now. As a business we are much stronger and more developed and have more resources," Nashif said. U.S. Mattress had $50 million in revenue last year, up about 5 percent from the year before. He projects the company's revenue will increase 5 to 10 percent in the coming year as the new stores open.
"We have built a fairly sizable business online with strong brand, service and product offering," he said. "We're looking to expand that in the retail setting." The mattress business has gotten a firm bounce from the economic recovery. The wholesale value of mattresses sold in the U.S. last year grew 8.7 percent to $6.2 billion, with the number of mattresses sold rising 4 percent to 20.9 million, according to the Alexandria, Va.-based International Sleep Products Association.According to a Furniture Today report, the association's latest industry forecast projects consistent growth the next two years, with the wholesale value of mattresses sold increasing 6.5 percent in 2016 and 2017 and the number of mattresses sold rising 4 percent each year. The trade publication said the ISPA's industry forecast attributes the increases to growth in disposable income and a solid recovery in housing. Last fall, U.S. Mattress added a store in Birmingham, and this summer opened stores in Southfield and Bloomfield Hills.
A 15,500-square-foot warehouse outlet center is also set to open in Livonia on Industrial Road between Wayne and Levan roads Nov. 16, following the closing of one of two warehouses in Brighton. And within the next year, Nashif said, the plan is to open three more stores in leased locations, giving the company nine sites. Those stores will add a projected 10 more jobs, on top of 12 created by the recent store openings, he said, noting the company now employs 90 people. According to industry estimates, 3 percent to 4 percent of mattress buyers purchase them online, Nashif said. "While that's growing, and we are a leader in that niche, the vast majority of mattresses are still purchased in a store. That's the audience we're trying to reach," he said. Brick-and-mortar stores also enable U.S. Mattress to offer brands that are not sold online, he said. In addition, stores increase brand awareness and can drive more people to a retailer's website, said Ken Nisch, chairman of Southfield-based retail consulting firm JGA Inc."
When an online retailer has a local presence, customers feel more comfortable that if they have issues or returns, those will be more easily handled with a physical store," he said. U.S. Mattress' strong online presence means it doesn't need as many stores in the region "because customers have the convenience of shopping online 24-7," Nisch said. The online mattress segment is exploding, driven mainly by strong marketing on the part of Casper, which is largely an online mattress retailer, said David Perry, executive editor of Furniture Today."There's virtually a new online mattress retailer every week popping up," he said. Those include Casper, Tuft & Needle and Leesa Sleep LLC. U.S. Mattress World's brick-and-mortar expansion is a response to others coming into the online category, Perry said. But it's also a smart model to expand the business. "If you can be attracted to the brand online but actually go try the mattress, that can be a significant advantage," he said. Michigan is likely an attractive market for U.S. Mattress because with Art Van Furniture Inc. it has a strong retailer advertising bedding needs and increasing awareness of sleep sets, Perry said.