Russell Turner, owner and CEO, 1915 South, Thomasville, Ga.
We have just finished a five-year run of the most aggressive growth and infrastructure retooling in our 107-year history.
PPP was rolled out and totally necessary to keep our team together and at work. We are now dealing with the extra stimulus that the federal government spread throughout the economy. The big push for wage increases to $15 that seemed to be such a stretch then is now a distant memory left in the past.
The Fed is now tasked to slow the inflation to 2{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b}, but labor drives that as the reason it will be tough. We, at 1915 South, don’t see that the effects of the rate increases and the reduction of the Fed’s balance sheet will have much effect in the next six months. The second half of the year we could begin feeling it, and the Fed will always go too long to get to the 2{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b} target. First quarter of 2024, fed rates will probably be coming down again and hopefully this recession is a quick one.
We are looking to perfect our processes in 2023 and increase cash for growth again in 2024.
Stuart Carlitz, president and CEO, Bedding Industries of America
I would suggest that we are already in a recession. While unemployment remains low and gas prices are coming down, we must continue to monitor housing starts because it is always a solid indicator of demand in our industry. We expected 2023 to be soft but anticipate that it picks up in the latter part of the year.
To counter that softness, we will continue to invest in our portfolio of products so we can appeal to every consumer looking for a mattress, especially at more moderate price points. In addition, we will continue to provide great value at premium price points, which supports our core tenet of offering affordable luxury.
Lastly, we will continue to invest in digital commerce to reach consumers who want to purchase online. But we are taking a different approach there. We are working closely with our brick-and-mortar retailers to partner with them, collaborating instead of taking sales from them. Our Harvest program is a good example of this. We built a very dynamic platform which creates economic opportunity for our dealers. We will continue to expand our digital work into other areas as well in the coming year.
Eugene Alletto, CEO, Bedgear
I do believe that there will be a slowdown, relevant to the large increases that many industries had due to COVID and the stimulus money. I don’t believe we will have an all-out traditional recession.
We feel at Bedgear that the trend for innovative and better products is going to continue as well as commodity price points. The mushy middle price points are going to take the biggest hit in volume.
The real concern I personally have and think about is what are middle price points today? It has shifted due to inflation and the inefficiencies of direct-to-consumer model, with such high returns and cost of acquisition, what are customers thinking with respect to quality innovation versus convenience and buying something in a box? What does the consumer really consider differentiated product and price points?
The other trend that we are paying attention to is where the consumer is going to spend their money and where are they going to reduce their spend. There are going to be winners and losers within different sectors of business and then within those sectors, they’ll be variant degrees of winners and losers.
Being in the home furnishings category we think that the baby and kids segment has the opportunity to grow. The sleep category is always important, home office, family rooms and outdoor. This is where the consumers are focused.
Elizabeth Dell’accio, president, Blu Sleep Products
It’s the million-dollar question. The one quote that we enjoyed was: “The U.S. will probably stick a soft-landing next year.” Simply meaning that we will narrowly avoid a recession as inflation fades and unemployment goes up. Economists are hovering around 30{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b} to 40{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b} probability of a recession while Wall Street forecasters are saying 60{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b} to 65{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b}. We would like to stick on the positive side of things.
There are even other economic factors saying that real personal income is springing back, and this translates to an increase in real disposable income, the question here now is when will we see the impact of this increase in the retail market?
The initial reaction of most companies is to tighten the belt during challenging times, but transformative leaders such as Blu Sleep are simply working harder on finding creative ways to drive long-term growth. At a moment when we are seeing competitors pulling back their spend, strategic investments against targeted, high-value audience segments will open opportunities to increase market share or strengthen our already high level of customer loyalty.
We are already getting creative with our media approach to the industry and are positioning ourselves to be more than ready for the market upturn.
Denny Boyd, president, Boyd Sleep
I do believe the likelihood of a recession is greater than 50{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b} over the next six months. We have experienced a number of recessions over that past 46 years in business.
Our strategy remains the same. We offer innovative quality products, great brands, superior customer service and aggressive pricing to support our customers.
Alex Shuford III, CEO, Century Furniture
Unfortunately, I think we are likely already in a home category recession and likely that a general one will be “called” in the dpring.
We believe that the softening of demand will turn around by the second half of 2023, and until then we are focused on reducing our backlogs and improving our lead times. We are still focused on increasing capacity to improve service levels and will have this same focus through most of the first half of 2023.
Eric Rhea, CEO, Corsicana Mattress
It appears the majority of the U.S. realizes we are already in a recessionary economy. As a result, we shouldn’t be focusing on what we call this but spending our time planning on how we will deliver for our retailers and consumers during this challenging period. We believe that the steps Corsicana has been taking since last year position us well for these new economic realities.
Fortunately, we have been recession-proofing our business for a number of months, making strides daily, weekly and monthly in our journey to improve our business.
We have made new additions in talent and realigned internal responsibilities to support our growth objectives. These changes assure that we are very focused on serving the needs of our customers, offering the necessary breadth across our product line from promotional to premium, and the absolute best value available in both our branded and private-label programs. We are delivering our customers the products they need, when they need them, with a fierce concentration on getting even the smallest details right.
Our national footprint enables us to serve customers from coast to coast very effectively and the feedback we are receiving from our customers is that we are serving them well.
At the same time, we continue to drive efficiency throughout our business. We are simply ensuring every function of our business is operating effectively. We still have work to do but feel very good about our future.
Shaun Pennington, CEO, Diamond Mattress
From our perspective, we’ve been in a recession for the past few months. As a financially stable, 80-year-old company, we have been through tough economic times and see recessions as opportunities for us to grow market share. We’ve already seen some factory closures in our region, and with our demonstrated strengths and ability to help retailers differentiate and capture the margins they need, we see opportunities to help them grow and remain profitable through a downturn.
Also, when retailers partner with Diamond, they can feel more secure knowing they have a stable supply and can maintain quality without having to cut corners on the products as things get lean. We are prepared for a recession and will be here to help our partners every step of the way.
Joe Bright, president, Dunk & Bright, Syracuse, N.Y.
I would put the likelihood of a recession in the next six months as low. All the macro statistics indicate a healthy economy.
We are continuing to grow and invest in our business. The fundamentals of driving traffic and growing sales are important in both a growing- or shrinking-demand environment.
Jon Stowe, managing director, E.S. Kluft & Co.
The U.S. will experience some sort of recession, much like 2009 with recovery to begin in the second half of 2023. Over the past few years, consumers have seen their buying power shrink over the course of 2022 as the cost for gas, travel, groceries and housing has skyrocketed.
The biggest problem facing the economy — high inflation — remains a major challenge. Per the Federal Reserve, inflation is expected to begin declining in 2023, but it does not seem that inflation will return to its target of 2{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b} until 2025. Still, as global supply chains continue to improve and the labor market stays relatively strong, we expect that, by the end of the year, we’ll start to see a return to normalization for our industry.
Although we see the probability of a recession and a challenging 2023 year for the furniture and mattress industry, we are still planning for growth of our business this year.
We have several key strategies in place that we believe will help us weather the uncertainties that lie ahead. We plan to: continue close relationships with our retailers, to support them on their plans and make sure they have everything they need; provide continuous commitment to an exceptional service level that will be enhanced with the opening of our third factory, in Grand Prairie, Texas; continue collaborating very closely with our suppliers, securing our supply chain and sourcing alternative suppliers for key components; and, implement promotional and advertising activities that will remain a key part of our marketing programs in 2023.
Ultimately, we see three key drivers that will help contribute to the growth of our business: strengthening our business and relationships with our current retailers, opening key new accounts in the U.S., Canada and export, and answering the demand for continued consumer interest in high value products.
Anne-Marie Earl, U.S. communications manager, Ethnicraft
If there is a recession coming, Ethnicraft hasn’t felt the effects of it. We have continued to grow year over year as more and more Americans learn about our quality product.
Our goal for next year is to outsell what we’ve done this year, and I’m confident we will meet that goal as we have for the past five years by wide margins. We will show at High Point Market, HD Expo, NeoCon and BDNY in the U.S., and we are in the process of building a U.S. headquarters with a showroom and expansive warehouse. This more than $20 million investment is indicative of how confident we feel about the U.S. market in both the short and long term.
Alan Hirschhorn, executive vice president, GhostBed
We are, in fact, already in the midst of a mild recession. It will most likely get slightly worse before it gets better, but I think it will get better in the third or fourth quarter of the year. Lower gas prices are one harbinger of a change that we are seeing now, and I suspect we will start to see other costs stabilize in the months to come.
For the mattress industry, there is no question that the focus is going to be value, at all price points. Whether consumers are looking to spend under $1,000 or more than $5,000, they will take a closer look at whether the products they are buying are the best possible value for their dollars. The industry is going to make sure that we meet those expectations.
Through our continued offering of superior products at a wide variety of price points and our commitment of millions of dollars to marketing to support our retailers, we are protecting our business and our retailers’ businesses from economic downturns. This is not something new, rather a core tenet of what GhostBed stands for.
In addition, we are continuing to bring innovative products to retail, like the industry’s first-ever massage bed. We are partnering with Cozzia to present a bed at Las Vegas Market that is not only restorative, but therapeutic. Innovations like this as well as the success of the Venus Williams collection keep us at the forefront of our industry and lay the foundation for a bright 2023.
Robert Naboicheck, president, Gold Bond Mattress
In short, I don’t think we’ll experience a dramatic recession this year. The Fed has increased rates, some would argue too aggressively, and we are already beginning to see signs of a correction. The lower-income consumer may need to pause spending, but that is not the case in the moderate and luxury sectors of the market.
As long as unemployment remains very low, and energy and fuel prices stay low, I have a positive outlook for 2023.
We’ll continue to do what has made Gold Bond successful for nearly 125 years: offer unparalleled quality, handmade products and personalized RSA training along with superior customer service. This positions us well for any challenges in the year ahead. Since our products are designed for durability and longevity, they will continue to resonate with both retailers and customers who are walking away from disposability. We are optimistic about the coming year for our dealers and our company.
Jamie Collins, executive vice president, Homelegance
With the overall furniture industry, it’s obvious there’s a slowdown. We all knew we wouldn’t maintain pandemic levels. We expect business to slow down. But furniture is cyclical. When the economy slows, it tends to affect us significantly. We’ve always been cyclical. We’ve been in a super cycle. No one could have predicted the business boom. A lot of buyers have been taken out the market.
We will focus on what we do best. It’s not that we will do anything differently. We’re going to provide great product at a great price. We will service our customers the best we can with the best products we can. We’ll make sure we’re focused.
Skipper Holliman, CEO, Homestretch Furniture
Based on all available information, we certainly believe at least a mild recession is coming sometime during 2023. We are probably already in one, but it is somewhat disguised because the labor market has remained pretty tight due to the fact that there are still a good many potential workers that have not yet reentered the workforce. That seems to be changing now as we are beginning to see more layoffs and business failures across various industries, which should make labor more available to those companies that need workers.
We are focusing on the fundamentals of being the very best supplier we can be to our customers by providing them with an outstanding quality product and keeping plenty in stock. Our in-stock/quick-ship model allows our customers to place orders each week for what they sell and get the product immediately without having to tie up a lot of working capital in finished goods inventory. In the long run, we believe that model will always succeed, especially as we enter an uncertain business environment in 2023.
Felipe Orozco, vice president of sales, Horizon Home Furniture
The recent heavy inventory situation has most suppliers already in an industry-wide recession. And retailers apparently are struggling to normalize inventory levels. With this process clearly taking longer than most of us expected, the big question is, will consumer demand be there when inventories finally get back to normal?
The Fed rate hikes clearly are not helping the situation as this has a direct impact on housing in general.
When the Fed slows down, or stops raising rates, we should see a turn around on housing sales. This will give the industry a much-needed boost. And may be the beginning of a turnaround in demand.
Right now, Horizon Home is concentrating on our domestic warehouse business. By increasing our in-stock inventory levels many of our customers are ordering just what they need vs. stocking up. Our Arizona and Texas warehouses have seen steady increased volume over the past six months as the direct business has taken a hit and more dealers choose just in time vs. price.
As for Horizon Home, we see a quick turnaround to this chapter and get back to extended stability for all.
David Binke, CEO, King Koil
The United States by all accounts is already in a recession, whether The Fed wants to admit it or not. Consumers are being very cautious in their spending. We are seeing more corporate layoffs, reduced bonuses being paid by financial services firms, and real estate is toggling down. I believe you are going to see these trends continue, probably even getting worse, in the first half of this year. I do think it will level off in the latter part of the year as the economy resets itself to a ‘new normal’ of tightened credit and higher interest rates.
The key for King Koil continues to be in creating superior value products in the affordable and aspirational luxury categories that are unlike anything else in the marketplace today. We are defining that product range by price points between $1,000 and $3,000.
We’re introducing both new products at the Las Vegas Market and remerchandising key collections to bring prices that had shifted due to supply chain issues, back into line. They will also have added features, exceptional feels and well-thought-out stories that are easy to share with consumers. Watch for a new take on our hand-tufted Intimate collection and an expansion of our ground-breaking sustainable denim line ReSpun.
Frank Hood, CEO, Kingsdown
Last month, Bloomberg reported that economists are saying that there is a seven-in-10 likelihood that the U.S. economy will sink into a recession this year. It is further expected that the Fed will not reduce interest rates in 2023 and that GDP growth will average 0.3{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b}.
But I think our industry needs to carefully monitor consumer sentiment, which is clearly getting more cautious. Whether an official recession or consumers slowing their spending, it has the same effect on our industry. I would be less focused on monikers and more on watching consumer spending patterns which are already changing.
Simply put, we intend to out-innovate our competitors. Product innovation manifests itself in many different forms at Kingsdown. It presents itself through new fashions and styles, new component specifications or new pricing strategies. We’re leaning in by reevaluating all the collections to create more dynamic visual appeal and ensure we’re providing choice, value and in some cases keener price points at the Las Vegas Market.
Fortunately, our AUSP is holding and in some cases growing, so we intend to capture more share on every floor and continue to establish more points of distribution in markets where we are under-penetrated.
David Cybulski, CEO, Klaussner Home Furnishings
I support the notion of rolling recessions where certain segments of the economy enter and exit a recessionary period at different times. With respect to the furniture industry, I believe we’ve been in a recession for quite some time, primarily driven by the pandemic and the corresponding economic swings.
As such, Klaussner prepared by continuing to focus on two key areas: (1) profitability by maintaining a lean organization and expense structure, and (2) cash preservation through prudent investments in inventory and capital expenditures.
As we begin 2023, I believe Klaussner will continue to see success by building on our legacy of innovation and customer service while constantly assessing the business horizon, with the agility and willingness to adjust where necessary.
Neill Robinson, CEO, Legacy Classic Modern
I think we’re in a recession now. Maybe a year from now, things will get better. We will have finally gotten through all of the pandemic-related issues of supply and pricing. We can get back to 5{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b} to 10{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b} growth mode. Everyone will get back to a more predictable pace of business.
My experience in the furniture business is by the time we realize we’re in one, we’re already coming out. Business is definitely contracting. The challenges for furniture companies, particularly for case goods businesses, is to get back to outperforming competitors. Whether its design or values. Execute your business model better than your competitors if you want to grow.
We’re focused on three things: Consistent quality, operational performance — so when we get an order we can ship it on time — and market share gain.
We’ve moved to being a direct container with large American distribution. This allows us to increase market share with smaller and medium retailers. We’re onboarding new accounts and increasing distribution.
Dexter Weber, president, LogicData
We believe it’s very likely that we’ll see a recession within the next six months due to the high inflation rates, decreased consumer/business confidence, changes in consumption and investments, and the geopolitical issues going on.
To address this, LogicData is focusing on flexibility to empower retailers of all sizes with their adjustable base offerings. We offer single-package drop-ship options, a domestic inventory program for pallet orders, and container programs to fit the needs of different retailers and e-tailers.
By offering the domestic inventory program it allows retailers to have less cash tied up into container orders with product shipping over the ocean. It also removes the risk of having too much inventory on hand in the retail stores and warehouses.
For the larger companies that prefer container volume in the U.S., we have opened another production facility in Malaysia to eliminate the impacts of the tariffs on products produced in China.
Billy Curtright, vice president of sales, Magniflex
A number of factors indicate that we are headed toward an economic downturn at the very least. Retail business has slowed, and consumer confidence is down. However, we are seeing positive trends as well, so while the first part of the year may be challenging, we expect 2023 to be a successful year for us, overall.
We are deploying several strategies to meet consumer needs this year. First, we are focused on growing brand awareness in the U.S. In addition, we are fostering relationships with the design community. With higher margins than many manufacturers can support, designers and retailers select Magniflex not only for quality and luxury, but for greater profitability.
We also are expanding our offering in Las Vegas to include a broader range of price points while maintaining luxury features, which will allow our retailers to introduce more of their customers to Magniflex.
An addition to Virtuoso, which will be introduced in Las Vegas, is a great example of this. It has the dual-sided comfort of silk and linen (for summer) and cashmere and wool (for winter) cover and a dual-core designed for couples with different comfort preferences. We’ll continue to bring innovative luxury to the marketplace throughout 2023 and beyond because we feel the consumer at this end of the market will continue to invest in a quality and restorative night’s sleep.
Rit Mathis, chief marketing officer, Mathis Home, Oklahoma City
We are already in a recession. Don’t believe the news if you hear otherwise elsewhere. Yes, it will continue over the first half of next year.
Cycles happen. They are part of it. We do in recessions as we always do: pay attention to details, address changes where they are needed, don’t panic or overreact, just take things one day at a time.
Oscar Miskelly, CEO, Miskelly Furniture, Pearl, Miss.
I think it’s more likely than not that we’re going to experience one. There are still discussions among economists about the likelihood and how severe it will be. Our hope it is it will be a short-term one.
We’re meeting with our leadership team to discuss strategy to address that. No. 1 is to be as efficient as we can be to control what we can control and cope with the things we can’t control and concentrate on what counts, which is taking care of the customer every day.
If we do all of those, we should be able to come out of it in good shape. We need to circle back and tighten up in some areas to make sure we’re here on the backside of whatever we’re facing and however long it lasts.
Glenn Kobylarczyk, executive vice president, Mlily USA
Whether or not the economists determine a recession has or will hit is less important than the decisions the consumer has to make with their paycheck every week. If it’s groceries vs. a new mattress, we know what that decision is going to be. But if it’s groceries vs. sleeping and feeling better, the thought process changes, and now the RSA and consumer can have a conversation.
Our strategy is to help our retail partners make sleep and health key elements of the question so that the mattress is not seen as a commodity. A component of that strategy is our exclusive partnership with the International Chiropractors Assn. to educate retailers and consumers about better sleep and health, and to design and build innovative products to achieve quality sleep.
Mlily has vast experience in building affordable, quality sleep products making us a strong strategic partner through any economy. Recession or not, consumers are always looking for the best value.
Moe Samieian Jr., co-CEO, Moe’s Home Collection
Yes, we think we are already in it and will continue into 2023. We are expecting for things to improve by fall 2023.
We are using this time to continue to bring efficiencies to our organization that can help reduce costs, and also using this time to continue to invest in product development, technologies, and improved processes for the future growth of Moe’s when the economy does start to improve again.
Chris Bradley, executive vice president of consumer products, NCFI
I don’t think there is any question that we are already in a recession. We saw contraction in both Q1 and Q2 followed by an unexpected GDP increase in Q3. More importantly, private goods have contracted for three straight quarters and four out of the past five, and at a much higher rate than the other sectors. In fact, Q3 saw a more than 10{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b} decrease in the private goods sector.
At NCFI we have been preparing since the middle of 2022 in two main ways. First, we are constantly evaluating our cost structure to make sure that our products are delivered in the most cost-effective way possible.
Secondly, we are meeting with all of our customers to see what we can do to give them an advantage in the marketplace. Whether it’s a new product or a new technology, it’s important for us to make sure that our customers are as competitive as possible. Those companies that operate efficiently and keep their customers competitive are the ones that are going to weather this storm the best.
Peter Zolferino, CEO, Omnia Leather
Based on the decline in sales and the rate of inflation over the past several months, we do feel that the recession is already in its initial first stage. Consumers no longer have the confidence in the stability of their investments, nor the disposable income to justify non-essential purchases. Those who can afford luxury spending are now interested in leaving their homes to travel.
The nesting mentality that propelled the home furnishings industry during the pandemic and beyond has obviously cooled considerably. On one hand, that surge could never have continued at such a rapid pace, but now we’ll have to see when we can get back to a “normal” sales volume or if it will it sink below pre-pandemic levels.
We know our retailers are overstocked with primarily import products due to an over-projection in sales. We saw this slowdown in the horizon, so while we are a custom, made-to- order product, we started offering in-stock programs and quick-ship items early this fall.
Giving our retailers the ability to order best-selling American made goods in this fashion alleviates the investment and risk of stocking merchandise. It also saves them non-existent warehouse space. The products are sold and ready to schedule for home delivery the minute it hits their dock.
We will always have a solid inventory of raw materials regardless of the market, but we have adjusted our inventory to the current market trend. We remain cautiously optimistic and will continue to listen to our amazing dealers. They’ve always stood by us because they know we will do whatever we can do to help them survive and succeed during these difficult times.
Jonathan Johnson, CEO, Overstock
With high inflation, rising interest rates, and the current economic situation, I believe the likelihood of a recession within the next six months is significant.
In our 23-year history, we’ve experienced many ups and downs in the economy, including 2008’s great recession. Although we are not immune to economic downturns, unlike others in our industry, our asset-light business model and strong balance sheet position us well to weather a prolonged economic drought.
Overstock’s quality-for-less “smart value” proposition resonates well with customers, especially when they are seeking to stretch their dollars farther. Additionally, we will continue to support our partner suppliers by paying them quickly and being able to sell their products on our site.
Doug Townsend, chief operating officer, Parker House
We are preparing for one. We are very cautious. Between inflation where it is, interest rates and a general uncertainty, we’re not planning for a big improvement. Whether that’s a recession or just a slowdown, who knows. But we don’t think it’ll be anything good.
We’re replacing people but not growing our headcount. We’re expecting the slowdown to continue.
Michael C. Parasmo, CEO, Precision Reclining Chair
We are optimistic because we are always on the ground hunting for new value and new bigger factories with higher efficiency capabilities to handle quick responses of retailers need for urgency to deliver goods, and we continue to outwork ourselves to be more competitive.
We are optimistic, buying raw materials, developing new relationships and having modest growth, and we moved to a new showroom that proved very successful, making the investment and change in a doom-and-gloom period where many were pessimistic.
Retailers are very strong lions that react quickly, and they have to buy to fill their warehouses for the consumers to reboot and spend.
We do not see prices going back to pre-2022 levels but within 15{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b}. We are seeing oil prices coming down to 42{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b} off their high back to December 2021, which is good for all of us. Shanghai freight rates have fallen 77{1668a97e7bfe6d80c144078b89af180f360665b4ea188e6054b2f93f7302966b} off their January high, which is a marvelous plus for merchandising products for margin. We believe these drops will stimulate more growth and positive results for everyone.
We are projecting our business model with powerhouse brand Kathy Ireland home motion products to see a very healthy April market spending cycle for retailers due to retailers cleaning out their over inventoried warehouses and making “New Playbooks” to win market share and steady growth.
Toby Konetzny, CEO, South Bay International
I think this could be the most anticipated recession on record, but yes, I believe we will be in a general recession mid-2023 and in the home category we will see it sooner. The home category is coming off a pandemic fueled economy for the past two years, so any pull back will be more pronounced, and those companies that over extended themselves based on that growth may have some larger challenges ahead, and those who were already challenged prior to the pandemic bounce will be experiencing those challenges once again.
Our strategy remains largely unchanged by providing a quality product at a value to the end user. We implemented many long-term strategies in 2022 for sales growth and product R&D, and we will continue with those strategies through 2023.
Our main focus is to be hyper-focused on the data from our customer demand and product flow. With our mix of customers, we are able to gather data from multiple sources to get a good reading of where we are heading.
Nick Bates, president, Spring Air International
I believe we are already in a recession, and it will continue until we start to see inflation under better control. The economy is already moving in that direction, which is indeed a good sign. That said, I don’t believe in wasting time debating with economists because it makes more sense for us to focus on how our industry pivots to handle the challenges that are coming in 2023.
Our strategy is unchanged, and that is to continue to help our retailers drive door clicks and close sales on their retail floors. Our approach to accomplish this is very comprehensive.
We’re benefiting from the fact that we now have national licensee coverage coast-to-coast. Those licensees are also finding greater value in our brand and are transitioning business that was either private label or another brand, over to Spring Air.
We are also gaining significant super regional and national account business over the past few years, and that is only accelerating with our extended licensee base. More retailers than ever before are giving us opportunities to grow within their walls, especially as other manufacturing facilities and licenses close or lose market share.
For us, this year will be about fine-tuning our manufacturing processes and continuously building on how our licensees work together as a force to be reckoned with. Our product development meetings, where we bring what I consider to be the best minds in the bedding business together to examine what the market needs and when, continue.
We have two collections as a result of this strengthened collaboration launching at the winter market: Last Mattress by Spring Air and Back Supporter Hybrid Plus, both of which are evidence of how well that business model is working.
We also will continue to launch products throughout the year as we identify opportunities in the marketplace. Indeed, one of the things that really sets Spring Air apart is that we are no longer tethered to the traditional market cycles. It’s an outdated business model that we just don’t think makes sense any longer for the health and well-being of our industry.
Tom Murray, chief market officer, Tempur Sealy International
During our third quarter earnings call, we shared that we continue to see an impact on the U.S. consumers’ behavior from macroeconomic pressures, particularly from strong inflation and a sense of near-term economic uncertainty. We’re watching the macro developments closely and adjusting to the market conditions, while staying aggressive and on-strategy.
This approach has driven Tempur Sealy to outperform the broader market through the third quarter. Our ongoing investments in developing and marketing premium products position us well in the current macro environment, as the premium segment has remained resilient despite the current economic uncertainty.
Combined with our continued commitment to our Retail Edge consultative-selling approach and toolkit, we believe that our 2023 product and marketing plans — particularly for Tempur-Pedic and our recently launched lineup of Stearns & Foster premium-innerspring mattresses — will continue to enable us, and our retail partners, to make the most of the category opportunity in the coming year.
Luis Ruesga, CEO, Zuo Modern
I will not call this a recession; it is more of an adjustment of the amount of furniture that the consumer bought in 2021. Now we will experience a slow down on the residential side, but we will see an increase on the hospitality side when we see all the small restaurants re-open with a new concept and a new design.
In addition, the small boutique hotels are getting ready to upgrade or change their concepts.
The decrease in business will come if you don’t look for the business, but it is out there. Just a matter of finding it.
