When you own a retail business, you want sales to follow a logical pattern. When they don’t, it becomes impossible to order and to forecast.
In some cases, you may know that sales are going to increase during a specific period. Maybe there’s a major event in your area that will drive traffic to your store.
Usually, those events are predictable. For example, when I ran a very large toy store in Connecticut with a huge model train department, we knew about a year in advance that a major train convention was coming to nearby Hartford.
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That gave us time to arrange extra inventory and special items just for convention attendees.
When you have an unexpected burst in sales, that can be a positive as well, but it can also be a negative. Covid pulled forward a lot of sales in multiple businesses.
Many people needed new laptops because they were working from home. That changed the replacement cycle and made it difficult even for big retailers like Best Buy.
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That chain was hit with a double whammy of people also needing to move up the replacement of appliances.
In theory, a business would see these sales as pulling from future demand and adjust accordingly. That’s really hard to do, as you can’t close three days a week two years from now because you had an unexpectedly good July.
The Covid pandemic ultimately forced a lot of furniture companies into bankruptcy.
Image source: Shutterstock
Furniture stores were hit hard
Furniture companies were hit especially hard by the changing buying patterns forced by the pandemic. A lot of people felt that if they were going to be stuck at home, they might as well be comfortable.
Some people also needed new home office furniture and other pieces because they were spending more time at home. That was good news in the short term for those companies, but ultimately those sales led to very slow periods in the post-pandemic world.
Mattress stores were hit hard by this cycle and American Mattress, which operates stores in the Chicagoland area, Indianapolis, and Fort Wayne, as well as multiple Florida locations, was not exempt.
“American Mattress was founded in 1988. Two co-workers from a local family-owned mattress company became disheartened after the business was sold to a major corporation. The family-owned culture quickly disappeared. Treating customers and employees like family was replaced by big corporate policies,” the company shared on its website.
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The two friends decided to strike out on their own and create a company with a locally owned culture of friendship and treating every customer like family.
“The sleep industry has changed over the past 30 years, but the American Mattress brand has never wavered from its original beginnings and remains a symbol for unmatched customer service and the highest quality product offerings,” the company added.
American Mattress files Chapter 11 bankruptcy
AFM Mattress Company LLC, doing business as American Mattress, a retail mattress company based in Elk Grove Village, Illinois, has filed for Chapter 11 bankruptcy protection in the District of Delaware. The company filed on July 6 and reported both assets and liabilities between $1 million and $10 million.
The company did not share a turnaround plan or list a new source of funding in the Chapter 11 filing.
It did report that AFM Mattress has approximately 100-199 creditors. The petition also indicates that funds will be available for distribution to unsecured creditors.
The company has retained Maria Aprile Sawczuk of Goldstein & McClintock LLLP as bankruptcy counsel.
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American Mattress appears to still be operating, since its stores remain open and you can still place an order on its website.
The company does not mention the filing on its social media feeds, which are currently promoting 4th of July sales.
Existing orders are expected to be filled.