In an effort to clean up its balance sheets and shrink its store footprint, Mattress Firm filed for Chapter 11 in October. The retailer plans to close 700 stores by the end of the year. Although the retailer was plagued by accounting scandals, many of its problems were focused on not paying attention to shifting consumer desires.
While many of Mattress Firm’s competitors amped up efforts online with a direct-to-consumer model—which included bed-in-a-box products shipped directly to customers at no additional cost—the retailer beefed up its investment in brick-and-mortar. The company purchased Sleepy’s, a Brooklyn, N.Y.-based company with 1,000 stores that had a strong customer base in the Northeast. By acquiring Sleepy’s, Mattress Firm intended to boost its reach from coast to coast through a total of 3,000 retail stores. Unfortunately, the plan backfired.