Mattress stores stay in business through a combination of strategies that allow them to attract customers, manage inventory, and profit from the sale of high-margin products. Here are some key ways they stay afloat:

1. High-Profit Margins

• Mattresses are high-margin products: Unlike many other retail goods, mattresses typically have significant profit margins. A store can buy a mattress at a wholesale price and mark it up considerably, sometimes as much as 50% to 100%.
• Add-ons and accessories: Mattress stores also sell accessories like pillows, mattress protectors, and bed frames, which often have high profit margins as well.

2. Sales and Discounts

• Promotions and discounts: Mattress stores frequently run sales (e.g., holiday sales, clearance events, or seasonal promotions) to draw in customers. While the sale price may seem like a big discount, it often allows the store to clear out older models while still maintaining a healthy margin.
• Price negotiation: Many customers expect to haggle, so stores build that expectation into their pricing models. A mattress might be marked at a high price, but customers will feel good about negotiating it down.

3. Financing Options

• Flexible payment plans: Many mattress stores offer financing plans, allowing customers to pay over time. These plans can include interest or fees that make the sale more profitable for the store.
• Credit partnerships: Mattress stores often partner with financial institutions to offer store-branded credit cards or promotional financing options, which can also increase sales and improve cash flow.

4. Customer Experience and Brand Loyalty

• Product testing and comfort: Mattress stores emphasize the ability for customers to test products in-store. This creates a tactile experience, which helps customers feel more confident in their purchase.
• Brand loyalty: Many customers return to the same store when it’s time to replace their mattress, especially if they’ve had a positive experience. Some mattress stores build brand loyalty through customer service, warranties, and satisfaction guarantees.

5. Direct-to-Consumer Models (Online and Physical)

• Hybrid models: Many mattress retailers are adopting a direct-to-consumer approach through e-commerce (e.g., brands like Purple, Casper, and Tuft & Needle), which allows them to avoid some traditional retail overhead. Some of these companies also have physical stores where customers can try out the products.
• Subscription and trial periods: Companies like Casper and Purple often offer trial periods, where customers can sleep on the mattress for a period (e.g., 100 nights) and return it for a full refund if they are unsatisfied.

6. Low Operating Costs

• Cost-effective stores: Many mattress stores operate out of low-overhead spaces, such as small showrooms or locations in strip malls. They often don’t need large inventories, as mattresses take up a lot of space but sell for higher prices.
• Efficient supply chains: Mattress retailers often have partnerships with manufacturers or use centralized warehouses to keep inventory costs low.

7. Brand Partnerships

• Exclusive partnerships: Some mattress retailers work with well-known brands (e.g., Tempur-Pedic, Sealy, Serta) to sell their products. These brands can help drive foot traffic, as people may be looking for specific models.

8. Convenience and Expertise

• In-store expertise: Many mattress stores offer knowledgeable staff who can guide customers through the selection process, helping them choose a mattress based on factors like firmness, material, and health needs.
• Convenience: The in-store experience provides the benefit of immediate purchase and delivery, which appeals to customers who don’t want to wait for shipping.

9. Advertising and Marketing

• Strong advertising campaigns: Mattress stores spend a lot on marketing, often through TV ads, online campaigns, and local promotions. Familiarity with a brand can drive customer trust.
• Catchy slogans and jingles: Mattress stores often use memorable slogans and jingles, making their brands stick in the minds of consumers (e.g., "Sleep Like a Baby," or "The Mattress Firm").

In essence, mattress stores stay in business by leveraging high-margin products, marketing savvy, flexible payment options, and a strong customer experience, while navigating the competition between brick-and-mortar and online models. The key is balancing inventory management with sales strategies and customer satisfaction.