In the past, purchases for mattresses and other beddings would get done in departmental stores. However, this is not the case anymore. From statistics, American mattress stores own more than 50% of the market place. Statistics also estimates that there are more than 10, 000 mattress stores in the US. The fact is that the number is continuously growing daily and will continue to expand. The question many of us are asking is, “why are there so many mattress stores?” In regards to this question, we devote our time to discussing the reasons why the number continues to increase.
- High-Profit Margins
Mattress sales come with high-profit margins. You don’t have to make a lot of sales to earn a reasonable profit. Make a comparison with the grocery stores around your area. These people make a profit margin of approximately 5% to 8% per sale. Here, you’ll have to make many sales to generate reasonable profits.
However, the cost of making a mattress that sells at $3, 000 is approximately $300. That means that you have a profit margin of up to 900% in selling a single mattress. Therefore, a store will need to sell approximately 15 to 25 beds to cover its expenses in a month. Any sales beyond the mark turn into profits. If a store has branches in different parts, it incurs less advertising cost and therefore more likely to make even better profits.
This has been a significant factor in the high clustering of mattress stores in your town. The better the profits margins, the higher the chances are for retailers to open more of that particular business. And this is what happening with mattress stores all over the globe.
- Need for Physical Interaction of the Item with Customers
Most of the mattress customers will prefer purchasing the mattresses from the stores rather than online. These are among the items that customers want to have physical interaction. They want to touch and feel how smooth the mattress is and its firmness. And this is not something that you can check online, and these are factors that determine the quality of your sleep.
To many people, buying a mattress is something that calls for a lot of thoughts and effort. You want to buy something that will last for at least a decade. The fact that most of us will spend much of our time in bed, we feel the need to be wiser in the selection. You want to try a variety of mattresses before you can make a purchase. Such a thing is impossible to do through online stores.
Remember that each of the mattresses will possess a unique design different from other models. As a result, customers don’t want to assume this part by making purchases online. They want to make sure they purchase only that which suits their needs perfectly. The physical interaction between the buyer and products helps you to make informed decisions. And this is among the reasons why there are a lot of mattress stores in your town.
- Less labor required
To manage a mattress store, you need one or two employees. According to getbestmattress.com, The stores have occasional customer visits meaning that very few employees are required to run effectively. Also, the stock is not changing at a constant rate if you can make a comparison to the cloths or grocery stores.
It means that not much labor is necessary to keep your store stocked. If you employ a few employees, you incur a lower cost of operating the business. This translates to two things: you won’t need high capital to start the business and low labor costs meaning that you’ll pocket much of the profits that the company generates.
- Does not need a lot of advertisements
Another reason why mattress stores are booming in your local area is the fact that they need reduced publications. A mattress store is like a furniture store. Customers will easily recognize it from a distance. From the large signboards and lights, they’re easily noticeable by the customers.
Also, the names of the stores easily explain to the customers what the store is all about. The owners, therefore, do not need to do newspaper advertisements for customers to notice their businesses.
- Recessions Increase demand
Between the years 2008 to 2012, cash flow in the US was down. As a result, many people decided that they should continue to sleep on the lumpy mattress to bring food to the table and pay rent. Therefore, there was no cash for use in buying new beddings.
The lack of finances also facilitated to the reduced rates of people getting married in these years. And this decreased the sales of mattresses in the whole of the US. After 2012, things changed and started to have a reliable cash flow. As a result, many people began to get married and also bearing children — such a pent-up increased mattress demands as a result of the recession.
When people get married, they tend to buy new mattresses. And this is the same case with newborn babies. From this reaction, mattress retailers are continuously opening new stores in different parts. From researchers, the recession effects will continue to increase demand and therefore a lot more of the stored are yet to get open.
- Mattress stores Steal Customers from Other stores
Mattress stores operate in a similar style as fast food restaurants. A customer wants to make sure that he buys a mattress that is better than the last purchase. And as a result, the customer has to visit several stores before making a final decision. And this is what retailers use and therefore opens the stores clustered together.
To win customers, they invest in highly-qualified salespeople and also include the lowest price bids in the city. And that’s why retailers will open stores next to the ones already existing.
Mattress stores are increasing in number and will continue to rise continuously. If you’re still wondering “why are there so many mattress stores?” above are the primary reasons.