Strategy: Mattress Firm just filed for bankruptcy and is closing hundreds of stores — here's what it's like to shop there

Mattress Firm has come under scrutiny for having too many stores.

Mattress Firm filed for Chapter 11 bankruptcy protection on Friday. As part of its bankruptcy restructuring, it said it could close as many as 700 stores.

  • Mattress Firm filed for Chapter 11 bankruptcy protection on Friday and said it could close as many as 700 stores.
  • It is the largest specialty mattress retailer in the United States, with an estimated 3,272 stores, according to Wedbush analyst Seth Basham.
  • Last October, Mattress Firm filed a lawsuit against two former employees, a broker, and a group of developers, accusing them of conspiring to push the company to aggressively expand.

It has been an eventful few months Mattress Firm.

In the span of a year, the mattress retailer has been accused by internet sleuths of running a money-laundering operation, announced it would be closing almost 200 stores, watched on as its parent company's business practices have been investigated, and battled an ongoing lawsuit against two former employees, a broker, and a group of developers, accusing them of conspiring to push the company to aggressively expand and open stores.

On Friday, it filed for Chapter 11 bankruptcy protection and announced it would be closing as many as 700 stores.

With an estimated 3,272 stores, it is the largest specialty mattress retailer in the US, and it's not uncommon to find many of its stores right across the street from each other. Increasingly, it has come under pressure as new startups like Casper find ways to improve the experience of shopping for this high-ticket item.

We tested the experience of shopping at one of its stores back in April. Here's what it was like:

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We visited a Mattress Firm store in Manhattan's Tribeca neighborhood in April. From the outside of the store, the focus seemed to be on luring shoppers in with deals and financing options.

While our visit to the store was in the mid-morning on a Wednesday — definitely not prime mattress-shopping time — the store was noticeably empty.

In January, a Reddit thread that accused the store of being a front for money laundering went viral. Reddit users claimed that Mattress Firm's stores are often empty, which they claimed could be a sign of something more dubious. Mattress Firm has denied these allegations.

We also visited two other Mattress Firm stores in New York and found that each one was completely empty during the day. It was almost impossible to go unnoticed, and we were instantly approached by a pushy salesperson who asked lots of questions and was reluctant to leave us to browse.

While some shoppers might find this helpful, their persistence was a little off-putting.

Each mattress was laid out on a bed frame for shoppers to test out. The mattresses were color-coded by firmness, which made it easy to shop.

The mattresses were expensive — some cost over $5,000 for a king size — but shoppers were constantly reminded of the financing options available.

Despite the available financing options, these mattresses are considerably more expensive than the options at bed-in-the-box retailer Casper, where a king-sized mattress, for example, can cost from $725 for a standard mattress and go up to $2,250 for a more technical piece.

The salesperson reassured us that there was a large discounted section on the lower floor.

Discounted mattresses were stacked up in piles for customers to buy then and there.

This is because the company offers a 120-day return period for customers to trial its mattresses. Returned items are then offered to other customers, often at a 50% discount.

These mattresses were still expensive, however. Some cost as much as $700.

The store was huge, and there were areas of unused space. In some parts, you could find boxed-up inventory on display.

There was a second desk area for salespeople downstairs, but no one was present.

Dotted around the store were various sleeping accessories, including specialty pillows.

There were pillow shields available for customers to test out the bedding, which was a nice touch.

We were impressed by the cheap bedding. These sheets were being sold for $10.

These mattress covers came with a 10-year warranty.

It's clear that the company is taking its new online competition seriously: there were signs discouraging customers from shopping at bed-in-a-box companies.

Mattress Firm launched its own version of the bed-in-a-box, called Tulo, in October 2017. Costing between $390 for a twin and $900 for a California-king-size mattress, these products are aimed at millennial consumers.

The store was easy to shop and well laid-out, and there were a ton of options to try. Still, the stores we visited were very empty, which was surprising given how many stores the chain has in highly concentrated areas. Even with the sales and discount signs, customers didn't seem to be biting.

Source: Pluse ng

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