The new year will look a lot like the old year for the mattress industry.
That's the inference from the most recent bedding forecasts issued by the International Sleep Products Assn., whose statistics committee convenes as a forecast panel twice a year to predict unit and dollar growth in the coming years.
The October forecast sees 2% unit growth in 2014, which would mirror the 2% unit growth it believes the industry will achieve in 2013. (It will take a few months for the final reports on 2013 shipments to be tabulated and published.)
On the dollar side of the equation, the ISPA forecast panel sees a 3.5% increase in the wholesale value of bedding shipments in 2014. That would be a slightly stronger performance than the 2.7% dollar increase the panel forecasts for 2013.
Looking further down the road, the forecast panel sees 2015 as a much stronger year, with units expected to grow by 4% and the dollar value of bedding shipments expected to rise by a healthy 6%.
Jerry Epperson, an analyst with Mann, Armistead & Epperson, is a member of the ISPA panel who pens his "Another Perspective" column for distribution with the ISPA forecasts. He sees encouraging news in housing sales, employment, income, inflation, consumer wealth, migration, corporate profits and consumer attitudes, "all of which are positive, finally. This is a great improvement over the depths of the recession when all of these worked against furniture and mattress sales."
Epperson believes the 2014 and 2015 forecasts are "reasonable and very conservative."
"Given the encouraging news about the economy and assuming some resolution of the gridlock in Washington (he was writing before the government shutdown ended), 2014 ought to be a rewarding year to sell home furnishings," he said. "Auto sales, consumer electronics and appliances and some other sectors have enjoyed handsome gains in 2010-2012, filling some deferred demand for their products."
Is there deferred demand for mattresses?
That's a hotly debated topic in the industry, with strong advocates on both sides of the argument. It is worth noting that even if the ISPA unit forecasts materialize, by 2015 the industry will still be far below the historic unit high reached in 2005.
But the industry is about to surpass the dollar high, reached in 2007, and some bedding analysts like to note that dollars go in the bank, not units.
Looking at industry dynamics, the bedding battlefield is becoming ever more consolidated, with the top four brands now in the hands of two ownership groups.
