How much is a good night's sleep worth?
How about $4,500?
Michael Zippelli, chief executive officer of mattress-maker Dormia Inc., is betting on it. He believes people would be willing to pay more for his beds, which are made from viscoelastic memory foam rather than coils or springs, if they gave them a try.
"If you get a good night's sleep, you'll have a good day," he said.
Business is growing at Dormia, a portfolio company of Westport-based private equity firm Main Street Resources, thanks to increasing interest in high-end bedding, whether it be traditional innerspring mattresses or specialty bedding made from foam or latex.
It's a trend that some surprising players are trying to cash in on.
Marriott International Inc., which two years ago invested $190 million to replace 628,000 beds at its 2,400 hotels worldwide, touts its new "Revive" mattress to consumers. Westin Hotels, which started the hotel bed war, also sells its Heavenly Beds - made of 900 individually wrapped coils - for $1,250 for a queen, not including shipping.
And Swedish bed maker Hastens, which boasts custom beds with "hand-flailed" horsehair as a natural alternative to foam, recently opened a store in New York featuring its signature product, the Vividus, which retails for an eye-popping $49,500.
David Perry, executive editor and mattress writer for the Greensboro, N.C.-based trade magazine Furniture Today, said the category is the fastest-growing in the industry, mostly because baby boomers are looking for a panacea for their growing aches and pains, and they have disposable income to spend. Retailers like Dormia are happy to oblige, he said.
"They are very aggressively pushing the benefits of specialty bedding," Perry said. "They are conditioning consumers to ask for it."
Though it's still a small segment of the mattress market, specialty foam bedding is growing at a faster clip than the rest, with sales up 28 percent in 2005 over the year before to $1 billion, according to a survey by the International Sleep Products Association, a trade group based in Alexandria, Va. Innerspring beds accounted for $3.5 billion of total mattress sales of $6.4 billion in 2005, the association said.
Most people equate foam mattresses with Dormia's bigger rival, Tempur-Pedic, whose commercials show a salesman jumping up and down on the bed next to a still-standing glass of wine. The commercial also promotes the technology behind the foam mattress that was developed by NASA for astronauts to help absorb the strong gravitational forces they experience on takeoff and landing.
Perry said Tempur-Pedic has given a boost to other specialty bed manufacturers and retailers, including Dormia.
Still, the market for specialty bedding is fragmented, and Zippelli and other specialty manufacturers believe there is enough business to go around as it expands. Even the "Three S's" - Serta, Sealy and Simmons - that dominate the innerspring mattress market have introduced foam mattresses.
Zippelli, 46, said the industry has changed over the 25 years since he opened a waterbed store. Once a department and furniture store staple, mattresses are now sold online and at stores whose sole line is bedding.
Dormia operates 23 of its own stores, mostly at malls, and plans to open two more this year, hoping customers will feel the difference by squeezing, sitting and stretching out. The company also sells its mattresses through its Web site and 1,000 mattress retailers, with models starting at $1,599.
With annual revenue of more than $50 million, according to Zippelli, Dormia is expanding its manufacturing space in Jessup, Md., by 25 percent, to more than 130,000 square feet, and is looking to hire up to 10 people to join its work force of 100.
Main Street Resources last February invested an undisclosed sum to help finance Dormia's expansion.
Mark Bates, a partner at Main Street, said his firm has confidence in Zippelli's team and strategy.
"It's a very unique industry with a lot of potential for growth," Bates said. "They're innovative guys. They're always coming out with a new, high-quality product."
Main Street is a private investment firm that provides equity capital to small- and middle-market regional companies to fund growth, acquisitions, management buyouts and select turn-arounds.
It typically invests $2 million to $10 million per transaction, taking both majority and minority ownership positions.
The Jessup facility was long known as Classic Sleep Products, which was founded in 1971 and at one point was publicly traded. Zippelli's company, Advanced Comfort, a national mattress distributor he and a partner started in 1991, purchased the assets of Classic in 2000. He bought out his partner in 2004 and changed the company's name to Dormia, a play on the word for sleep in several Romance languages.
Many of the workers have been there for decades, Zippelli said, and they still assemble the mattresses largely by hand and package them in large brown boxes for shipping.
Furniture Today predicts that the slumping housing market will mean mattress sales will essentially be flat in 2007. But Zippelli said he isn't altering his expansion plans.
"Major players are jumping on the bandwagon," he said. "Our goal is for the (Dormia) brand to have meaning to the consumer."
- The Baltimore Sun is a Tribune Publishing newspaper.