Metal bed vendors may have to raise prices
By Thomas Russell -- Furniture Today, June 23, 2008
HIGH POINT — Rising raw materials costs continue to squeeze metal beds vendors, who say they may have to raise prices of their products by as much as 15% this summer.
Some had already implemented increases earlier this year, but may have to raise prices again to help offset additional cost hikes.
Angle iron used in bed frames and bedding support systems has risen 34% since March, including the latest 8% increase on June 9, manufacturers said. One producer said the prices of North American cold rolled steel — the basis for steel tubing used in metal bed posts — has risen 79.5% since December.
Not every metal beds vendor faces the same increases for raw materials, however, with their costs depending somewhat on how their suppliers fare in the global commodities markets. But the message from importers and domestic metal bed producers alike is that prices are rising on a more frequent basis than in recent memory due largely to global supply and demand.
Pricing pressures caused domestic producer Elliott's Designs to raise prices 10% across the board on June 1, its first increase in at least two years, the company said. A metal bed that sold at $585 wholesale is now about $640.
On July 1, Fashion Bed Group will raise prices 15% on its metal beds and 8% on wood and metal models. The pricing was already factored into goods introduced at the April market, so those items won't increase any further.
Fashion Bed's price increase is its first since last year, said Rob Woods, president of Leggett & Platt's Consumer Products Group, which includes Fashion Bed Group. So far, he said, retailers have understood the need to raise prices.
“There has been very little resistance,” he said.
Domestic producers Corsican and Wesley Allen have raised their prices this year and say they may have to do so again before the end of the year.
“I don't think anybody has an answer about where it's going to go,” said Jim Vacek, Corsican's sales coordinator. Still, he said, vendors have to be careful not to price themselves out of the market. “You have to adjust accordingly,” he said, noting that if you hit someone with too big an increase, “they won't have any use for you. You have to do gradual price increases.”
Wesley Allen raised prices an average of 3.5% on three-quarters of its line on Feb. 1. But the company said costs have continued to rise on steel and other items such as foam used in packaging.
“We don't like to raise prices,” said Wesley Sawan, director of private branding. “We will absorb as much as we can and manage the cost to bring the cost down.”
Canadian metal beds producer Amisco hiked its prices late last year and says it is assessing whether it will have to implement future hikes based on raw materials costs.
To see what metal beds importers and manufacturers are doing to help limit price hikes, visit Tom Russell's blog on our Web site at http://www.furnituretoday.com/blog/510000051.html.
