Keeping pace with new industry needs and expectations – that’s what will separate the men from the boys in the supply chain ecosphere
If just making a good mattress could suffice, then there would be no need for neat showrooms, tempting shelves and transport services in the supply chain. But there’s more to a great mattress. Being late, being sloppily displayed, being far away – even the smallest gap can ruin the mattress experience for a customer.
That’s true for the mattress industry as well. The whole vehicle runs when all the cogs in the wheel run smoothly. No spoke is worthless, no part without its purpose- and that’s what makes for a great supply chain that powers a great mattress.
Over the last few years, the industry has witnessed, and adapted to, a flurry of changes. There is a lot that is redefining the industry and it is crucial for the stakeholders and partners from logistics, operations and factory-ancillary chains to acknowledge these implications too. There is a lot of room and reason for the supply chain segment to gather pace as the industry accelerates to new frontiers.
Some Compelling Drivers of Change:
- A big variation exists in the formats, price labels and Stock Keeping Units (SKUs) of mattresses – all this spurs a lot of confusion, complexity and transparency issues at the end of the chain.
- Inefficiencies lead to huge-mark-ups
- Most supply-chain parts are opaque and not aligned with market demands and speed-imperatives
- High restocking fees for returns and warranty-related tussles create a rift between the brand’s promises and actual customer-experiences
- Poor or inadequate training of salespeople and support staff
- Issues with long-distance deliveries create access problems for markets with potential but without reach – like rural places or never-tapped cities
- Geographically-dispersed manufacturing facilities
- A preponderance of an unorganised market in India
- A heightened level of awareness and information among customers (India Mattress Market Overview, 2016-2022). Also, a shift in demand from Coir or Foam mattresses to Spring Mattresses. The propensity to buy from international brands is also on the rise
- A change in the market scenario between offline and online channels- Retail sales of mattresses from dealers/distributors and own franchised stores etc. are now also making way for options like Flipkart, Amazon, Snapdeal, FabFurnish, Urban Ladder etc. or a company’s own personalised website
- Growing demand in the residential segment (due to the rise in housing demand and better purchasing power) is also changing the balance between residential and institutional segments of the market
- Differences in the density, block- dimensions, layers, hardness, proportions and sizes – as demanded in various markets – make it expensive and inefficient to ship mattresses and associated products
- The advent of new products that promise a new level of ergonomic quality, recovery and micro-climate sensitivity also necessitates a concomitant change in the supply chain’s ability to cater to these new propositions – like curing and packaging
- The rise of specialist-bedding shops and boutiques indicates an appetite for sophisticated, as well as personalised, offerings and channels
- Quirky marketing and new models as introduced by brands like Purple, Casper, Tuft & Needle etc. are injecting new customer aspirations
- Spike in demand for customisable products and premium-segment mattresses
- The impetus for end-of-life questions of a mattress – increasing awareness and pressure for making the whole chain sustainable and minimising environmental impact.
As we can observe, a number of factors from all sides – manufacturing to transportation to new product formats and changing consumer tastes are forcing supply chains and partners to keep up with these changes. The industry has a long way to go but, thankfully, signs of change are already evident in some ways and pockets.
How is the Chain Gearing up?
- Players like Saatva have introduced a new model to the market – Reverse Logistics. Here, a trial is where the process starts and then the customer can exchange or return the product as per one’s satisfaction score
- Omnichannel retail is picking up fast and is creating a new integration point from the factory to the end-point
- Economies of scale are being pursued by aligning and augmenting supply-chain parts with the overall strategy and end-to-end visibility
- Streamlining, intelligent tracking, planning and agile adjustments are injecting a new level of speed and simplicity across the mattress cycle
- Use of special packaging processes that are tailored for replacement promises: These efforts have also demonstrated that a clever combination of air-and-ship freight distribution channels can help in transporting mattresses produced in one part of the world to the other part and also to e-commerce vendors
- Concepts like ‘Ship In Own Container’ are reducing environmental wastage as well as unnecessary parts of the shipping process
- Optimised logistics is making it easier to experiment with bed-in-a-box formats as well as reduce the shipping-cost, and consequentially, the price tag of a product
The arrival of Ikea and online challengers in the Indian landscape is going to be the last straw of sorts that will push the industry out of conventional systems and adapt to a new set of challenges and customer- needs. The infrastructure and goodwill that the ecosystem commands so far is not trivial and with the right strategic intervention, players can build up on the experience and depth they have enjoyed all these years. But time is surely ticking. We are on the verge of confronting a fresh tide of innovations like intelligent mattresses, personalized products and technology-equipped sleep experiences. This will insist on a new level and speed of support from the supply chains that fuel the industry. A lot will have to be assessed, adapted and even, discarded for the emerging needs that are changing the market in formidable ways. Investments in skills, technology and transformation are going to be determinants of the new supply chain ahead. A chain that adds to a great mattress. As always.