Select Comfort has got your number. The firm's line of Sleep Number beds, which can carry hefty price tags, use air-chamber technology to allow sleepers to adjust the firmness on each side of the mattress, providing better sleep quality and addressing sleep-related problems, such as lower back pain. Select Comfort also offers foundations, frames, pillows, and a sofa bed. A leading bedding retailer in the US, Select Comfort operates about 385 company-owned stores nationwide and sells its beds through another 150 partner stores, most of which are in Canada. The air-bed maker also sells through a company-operated call center, its own website, and on the QVC shopping channel. Select Comfort was founded in 1987.
While Select Comfort began as a direct marketer of its unique air-filled mattresses, over the years it has evolved into a multi-channel retailer with company-owned stores in about 48 states. (Retail store sales have grown to account for more than 80% of Select Comfort's total sales.) With the US economy on the mend, 2010 sales increased 11% vs. the year earlier period. Same-store sales grew a healthy 21%, while direct and online sales increased by 5%.
With its mattresses starting at about $700 and approaching $4,000 for its premium product, it's not surprising the deep recession and housing crisis in the US took the air out of the air-bed maker's sales. Indeed, sales sank by about 32% between 2007 and 2009. The decline in its business put a halt to Select Comfort's aggressive expansion plans. While the company had hoped to grow to more than 600 company-owned stores throughout the US in coming years, it is instead looking to end 2011 with just 380 company-owned locations, having shuttered more than 110 stores since 2007. Beyond 2011, the company plans to return to expansion mode.
After entering the Canadian market in 2005, Select Comfort in 2007 partnered with two Australian companies to make and distribute Sleep Number beds and accessories in Australia and New Zealand. Additionally, the company's air mattresses are found in luxury motor homes, and in nearly all of Radisson's hotel rooms in the US, Canada, and the Caribbean.
Adage Capital Partners owns about 10% of the shares.
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