Just over a month after it filed for bankruptcy (and under the initial 45 to 60 days the retailer had planned for), Mattress Firm announced Friday that it gained court approval to exit Chapter 11, according to court documents.
The retailer expects to emerge from bankruptcy "in the coming days," according to a company press release, with a lighter footprint — down to 2,600 locations after closing approximately 700 in bankruptcy.
The mattress retailer filed for bankruptcy Oct. 5, amid pressure from startups like Casper and Tuft & Needle, with a promise to close stores, pay back all suppliers and exit in a timely fashion.
As far as bankruptcies go, Mattress Firm's seems to have been a quick and orderly process. The retailer came in with a plan to close 700 unprofitable stores, executed on it, and announced it was exiting the process free of the drama that has characterized other retail bankruptcies.
Mattress Firm followed through on right-sizing its store footprint and strengthening its balance sheet in under two months, a short period of time compared to others who have filed this year. Claire's, for example, took over six months to travel through Chapter 11, and even The Walking Company took four months to finish the process.
The speed of the retailer's bankruptcy has allowed the company to "continue with our mission," according to Steve Stagner, executive chairman, president and CEO of Mattress Firm, who said in a statement that Chapter 11 has allowed the retailer to "emerge as a stronger and more competitive company."
"Furthermore, our significantly improved financial and operating position will enable us to strategically expand our business in new as well as existing markets, while continuing to focus on enhancing our omni-channel capabilities and product offerings," he said.
The traditional brick-and-mortar retailer may be on its way to getting out of court, but it isn't quite out of the woods yet. Outside of Chapter 11, a host of young startups with ambitious expansion plans are lying in wait, winning over consumers with lower prices, convenient bed-in-a-box models and a more light-hearted approach to the buying process.
Casper's Chief Marketing Officer Jeff Brooks told Retail Dive in October that he wasn't especially surprised by the Mattress Firm bankruptcy, and hinted that the retailer would have to make changes to keep playing in the competitive space.
"[F]or over a hundred years a few players controlled virtually all the supply and distribution in this category and chose not to innovate or really think about the customer experience," he said.
And it's not just startups like Casper that Mattress Firm will have to compete with. The retailer entered Chapter 11 just after Amazon announced a private label mattress line and is waking up to a new, premium mattress line just a few weeks after the first.