Business in the bedding industry in 2025 is going to continue to evolve at a rapid pace. It will be an eventful and potentially challenging year, with a new president taking over in January, more acquisitions and consolidation expected, including the possible merging of Mattress Firm and Tempur Sealy, and promises of tariffs on various goods from various nations.
Yet going into the new year, the bedding industry as a whole seems to be optimistic about how the year will shape up.
“I believe the change in government will help loosen restrictions on business — whether it’s tax breaks or less government regulation in manufacturing,” says Gerry Borreggine, CEO of Therpedic. “We should look at how we can streamline our operations and keep overhead at a minimum. Because business will get better, nobody can afford to be sloppy. If we keep everything in line, then when business does increase, as we anticipate it’s going to, we’ll be in a position to reap a windfall from that.”
He adds that we may start seeing positive effects as early as the third quarter of 2025 and that he anticipates it to be a strong year for Therapedic, specifically.
David Binke, CEO of King Koil, also expects a positive 2025 for his company, saying it saw a nearly 25% increase in sales in 2024.
“The average unit selling price is increasing, and that helps offset the decrease in actual traffic,” Binke says. “But we have to figure out consistently how to continue to get people into the stores.”
Tariffs could make that a bigger challenge. Though he and his team have a strategy set for next year in preparation for tariffs or other obstacles, he says they are making people nervous — consumers, retailers and manufacturers alike.
“Taking away from people’s disposable income could be an issue with tariffs because often when people hear the word tariff they think the worst is going to happen,” Binke says. “But some of these tariffs could be instituted and equalize some of the tariffs that we can charge from other countries.”
Chris Taheny, senior vice president of Dreamfit, says there might be an uptick in consumer confidence because of the election, but the gains could potentially be lost by the initial concern about what tariffs will do to the economy. However, with the right presentation, retailers can still increase their average tickets.
“The customer is willing to spend $2,500 or more, as long as you give them a good presentation and a good reason,” Taheny says, “I know retailers who don’t have anything on their floor for less than $1,000.”
Going into 2025, Taheny says the industry has an opportunity to change its messaging. “It doesn’t always have to be a big mattress sale or 60 months of 0% financing,” he says. “You could start educating your local population about the importance of sleep from several standpoints, like the dangers of drowsy driving.”
Play devil’s advocate
Whether in business or life in general, I find that in situations where many are optimistic it can be helpful to look at things from the other side. Here are some observations and insights I’ve gathered by talking to industry members, mostly off the record.
Tariffs are coming in some form. And the fact they are being discussed by every media outlet is eroding consumer confidence. Regardless of if they even go through, there’s damage being done now, with many spending big on the holidays before tariffs hit, and others clutching at their wallets in case the worst happens.
That’s going to mean more work on the retailer’s part to make the purchase worth it. And that’s not an impossible goal. As Taheny mentioned above, regardless of the irony of people buying more expensive products when they are spending less, premium products are proving to be a successful sales driver for retailers.
Retailers can get through the negative effects of tariffs with a message about why spending more on a mattress is more important than spending more on another product.
Talking to retailers nationwide, the idea is clear — mattresses refresh and vitalize you; everyone needs to be healthy and refreshed to function at their best. Finding the best way to properly explain the health aspect is critical.
The other looming question in the industry right now is what will happen with the TSI/Mattress Firm deal. TSI and the FTC have been firing lawsuits back and forth, making it hard to know how this will all end. But two things are happening that make the deal seem like it is more likely to go through than not.
First, with Donald Trump as president, he’s likely to fire current FTC head Lina Khan, who’s known for her progressive views on mergers and acquisitions as well as other FTC-related issues. This change in guard could signal good news for TSI, which is what many had speculated back when delays set the planned acquisition date back from mid-2024 to now early 2025.
TSI and Mattress Firm recently filed a request asking a federal judge in Texas for a preliminary injunction to halt their Federal Trade Commission court proceeding. They argued that the later hearing date would give the federal court time to decide whether to issue a preliminary injunction before the administrative hearing begins.
The motion was granted and the hearing will now take place on Feb. 10, 2025. With this as its latest win, things seem to be going right for the success of the acquisition.
If it goes through, it could present obvious challenges to other retailers in the industry, like having to compete with the world’s largest mattress manufacturer backing the world’s largest mattress retailer and the billions of dollars they have at their disposal.
However, what’s becoming clear — especially with the success of premium sales — is that independent retailers still have an important place in the industry. Mattress Firm will always be the generic, entry-level brand that consumers envision. They’ve set their path. This leaves another path — selling better sleep to serious buyers who have the funds to buy a nice mattress — for independent retailers nationwide.
I don’t think it’s time to declare doomsday — whether we’re talking about the big merger, tariffs, low foot traffic or anything else. Everyone still has a chance to win in 2025, and that’s the message the entire industry is getting behind.
