why are tempurpedic prices so high
May 5, 2010 6:23 PM
Joined: Apr 12, 2010
Points: 52
why are tempupedic mattresses so high in prices?

What is the profit margin for them? Thanks.

This message was modified May 5, 2010 by firstposter
Re: why are tempurpedic prices so high
Reply #4 May 7, 2010 12:10 PM
Joined: May 7, 2010
Points: 7
firstposter wrote:

why are tempupedic mattresses so high in prices?

What is the profit margin for them? Thanks.


First, Tempur-pedic prices are high because people are willing to pay them.  This probably has to do more with their advertising ("don't be fooled by competitors", "used by astronauts", etc.) than anything else.

However, the funny thing is that Tempur-pedic's selling, general, and administrative expenses are a lot lower than Sealy's.  Tempur-pedic's gross profit margins are higher as well - 47% vs. 40%.  And to top it all off, the company is in much better shape (i.e. less debt) than its closest publicly-traded competitor, which results in a higher net profit to the company.  What does this all mean to you, the consumer?  Probably not much.

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