When the economy gets tough, people cut back on spending, eat out less often, and keep their cars for another year.
People also put off replacing worn-out household items, such as sofas and beds, which have an indeterminate lifespan. It's hard to know the exact time to replace some items because while a couch may be a little worn and a mattress a little worn, they still work.
Related: Bankruptcy Watch: Troubled Retail Brand Ends US Manufacturing
They are not like a washing machine, refrigerator or other appliance that stops working. There's no clear sign that suggests it's time to replace a mattress, so when people are worried about their jobs and the economy, they postpone expenses like buying new furniture.
Additionally, many Americans upgraded their homes during the Covid pandemic. With more and more people spending much (or all) of their time at home, many have invested in new furniture and appliances.
That boosted demand and created an uneven sales cycle for many furniture companies. This dangerous cycle claimed the lives of several well-known actors, including Mitchell Gold + Bob Williams, which was liquidated, and Z Gallerie, which filed for Chapter 11 protection and then sold its assets in May.
Now, another long-standing local chain has filed for Chapter 11 bankruptcy for many of the same reasons that unsettled its peers.
Image source: The street
Regional Mattress Chain fights to survive
Family-owned and operated Factory Mattress has operated mattress stores in Texas since 1977. The chain operates 21 stores serving the Austin and San Antonio markets.
“When you visit any of our Central Texas locations, you'll discover the largest selection of discount name-brand sleep sets, featuring mattresses and foundations from Sealy, Simmons, Tempur-Pedic, iComfort by Serta and Sleep Designs.” the company says on its website. “And it doesn't end there… (From) bed frames and memory foam pillows to mattress protectors and adjustable bases, we have almost all the items needed to create the perfect sleeping environment.”
The company built its business by offering fast deliveries on its own trucks and giving customers a year-long, no-questions-asked return period.
More bankruptcies:
- Popular movie theater owner files for Chapter 7 bankruptcy
- Distressed housing brand files for Chapter 7 bankruptcy and will liquidate
- Popular Restaurant Chain Shares Bad News About Chapter 11 Bankruptcy
It has now filed for Chapter 11 bankruptcy protection with the U.S. Bankruptcy Court for the Western District of Texas.
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Factory Mattress plans to continue
Steve Frey, founder and owner of the chain, cited road construction limiting access to its stores as one of the problems that led to the bankruptcy filing.
“Reorganization is a mandatory step to achieve economic relief. “Our stores will have no interruption in their operations for sales and support to our customers,” he said. Furniture today.
In its bankruptcy filing, Southwest Mattress, the parent company of Factory Mattress, listed estimated assets of between $1 million and $10 million and estimated liabilities totaling between $1 million and $10 million. It is estimated that it has between 50 and 99 creditors. Those are standard ranges that are options on the bankruptcy form.
Among its liabilities, the company shows $434,458.70 owed to Tempur-Pedic, $134,964 to Sealy, $72,755 to Kingsdown, $65,734.96 to MD Mattress, $49,264 to Serta, $41,366 to Nectar and $35,376 to Sleep Designs. Lines of credit and leases make up most of the rest of your top 20 unsecured debts.
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The company has not outlined a financing plan or mentioned how it expects to emerge from bankruptcy. There is no mention of Chapter 11 bankruptcy on their facebook page or website.
