Mattresses, not stereos is where the money is


On my way to Macy’s, to buy a bed, which is about 6 blocks from my office, I passed by literally 6 different mattress stores. 3 of them practically on the same block.

The competition is fierce, and it seems almost all of them were selling Tempurpedic and Sealy (which I think are owned by the same company.) They even had at least one paid sign holder with a sign directing you 1 block away to another store.

Think of that. 6 stores selling $500-$4500 goods, in a Los Angeles suburb. They are all paying rent, and staying open.

I know the average retail markup for stereo gear is around 45%. What must the mark up be for mattress stores to stay open with this much competition? 90%?

I still went to Macy’s. :) Two simultaneous discounts + a modular bed system with replaceable coils sang to my geek heart.

By comparison, the nearest high end audio store is about 30 minutes away.
erik_squires

I sold bedding and furniture many years ago.  One of the bedding lines we carried was Simmons. The top model we carried was around $1200.  Simmons offered the sales force that model for $250. I purchased a set for my folks,and a set for myself.  I ended up selling a ton of those mattresses.  Not to mention the $100 spiff they threw at each sale.  There is a TON of mark up. 

Everyone needs to sleep.  Not everyone needs to listen to music on high end systems.  Therefore more mattress stores than audio stores 

i obsessively researched this very topic before buying my new mattress (dreamcloud premier--fantastic). i was informed by those in the biz that the typical profit margin (after delivery costs and overhead but before salesman's commission) for brick-and-mortar retailers is around 40% but  higher on pricier mattresses--there are also manufacturer rebates + alot of high-margin sales of gray market goods. for online retailers, the profit margin is more like 100%. so considerably richer than audio...

I once was told that $2 toothbrushes often cost stores less than 10 cents. That's the business I should be in, setting up discount toothbrush stores at malls.  Have adorable models outside dressed all in black offering to brush your teeth for you, and then charge $30 per toothbrush....

Bottled water. Now, that's markup. $3 a case of 24, sells in the airport for $4.75 per bottle.

I once was told that $2 toothbrushes often cost stores less than 10 cents.