Industry members share their collective angst
Editor’s note: BedTimes normally cites its sources, but in this special report, we have allowed mattress industry members to speak anonymously so they were free to be frank about the unprecedented manufacturing challenges they face during the COVID-19 pandemic.
What happens to a manufacturing industry built largely on a just-in-time model when “on time” is out the window? What do mattress makers and their suppliers do when inbound component shipments are unpredictable, but orders are pouring in? Add to that personnel problems with plant workers unable or unwilling to return to work, as well as disease outbreaks at facilities.
BedTimes spoke with a cross section of domestic suppliers and manufacturers around the United States to find out how they are faring in these unprecedented times.
Up until this point, plants with component stockpiles, diverse supply chains and/or vertical manufacturing capabilities were in the best shape when it came to getting product out the door on time. But as one large independent producer who falls into all three categories said, “The turmoil isn’t over when it comes to fulfilling new orders. I’m more worried about what is going to happen over the next 90 days.”
At the start of the pandemic, product demand saw a steep drop. Traditional brick-and-mortar sales took the largest hit, with entire swathes of the country shutdown for weeks at a time.
Channels not dependent on sales through brick-and-mortar locations, such as e-commerce customers, did not see as big a dip in March and April – or if they did, they recovered quickly.
Then, sales jumped in every channel.
One major manufacturer described the rapid sales uptick in brick-and-mortar channels as “a crisis of epic proportions, but we’ve never been closer to our customers and our suppliers because of it. The hope is it will make us stronger on the other side.”
But, make no mistake, at the current time some of these relationships have their challenges.
Geography plays a large role in whose customers are happy and whose aren’t. Disease spread and factory shutdowns vary from locale to locale. One smaller manufacturer said he is careful not to source supplies from companies operating in COVID-19 hot spots.
But, despite careful sourcing, no one is immune to the global shortage of much-needed nonwoven components and the extended lead times from ticking suppliers.
A key issue is labor. Hiring back a full second shift is a struggle in the face of absenteeism, fear, disease outbreaks and the fact that some workers have found jobs elsewhere or are earning more on unemployment due to federal subsidies. Hiring difficulties vary by region and the size of the labor pool. For those companies that regularly run a third shift, the problem is even more severe.
One industry leader used the term “triage” to describe what it’s like managing business “day to day.” Production schedules change throughout the day based on inbound supplies and customer needs. “(We) are working harder than we have in our entire careers to get the job done and service our customers,” he said.
Manufacturing during a pandemic has been a learning experience, industry members said and lament that this may be “the new normal” for the foreseeable future. They said the current crisis has exposed flaws in their systems, shown them what isn’t working and what needs improvement. It has impacted the ability to maintain quality control and generally made everything “three and four times more difficult (while) slowing just about everything down,” one supplier said.
On the brighter side, bedding producers are learning to make use of the latest digital communication platforms to stay connected to customers and remote workers.
Meeting “epic demand”
Most suppliers and manufacturers agree that demand across much of the industry ground to a halt in March and April led by the shutdown of brick-and-mortar retailers. Beginning in May, that changed. They said ordering began rising quickly in May; by June it had exploded. All agree they are busier than ever – with no end in sight to the ordering “bonanza.”
One supplier said he has never seen volume like this. It’s not pent-up consumer demand only, but a new interest among those who are housebound – and haven’t lost their jobs – in spending discretionary income on comfort and the home environment.
“Once consumers got used to being home all the time, they started shopping online,” one manufacturer said. “We had anticipated a 20% to 30% increase in demand. Instead we saw a 200% increase.”
Some manufacturers who service e-commerce channels experienced a pause in ordering at the start of the pandemic. Others said there was an immediate uptick in online business and it has grown exponentially since then.
All interviewees said overnight everyone starting calling. Some suppliers said their phones are “ringing off the wall” with calls from desperate manufacturers they’ve never done business with before.
“The chaotic part is how busy we are,” a manufacturer said. “It’s a great problem to have. And we continue to get busier and busier.”
Industry members describe being so inundated with orders, they must give priority to their existing and most important customers. Depending on the product type, lead times are getting longer and longer.
As one supplier said, “Customer demand has increased so much and you can only make so many units per day.”
Impatient, angry calls from customers – and noncustomers – are an unfortunate daily occurrence, most interviewees said.
Raw materials: “exhausting every avenue”
The rapid rise in retail orders puts enormous pressure on manufacturers and suppliers to reverse shutdowns and get up and running quickly. In May, mattress makers said there were shortages of every component.
One manufacturer mentioned “supply chain destruction.” (Did he misspeak and mean to say “disruption” or not?) Another said, “We talk to our suppliers multiple times a day – these aren’t fun times.”
An executive who is both a supplier and manufacturer said: “No one anticipated how hard it would be to turn everything back on all at once. It’s taking months. I hear a lot of complaining out there. And working from home really doesn’t work in a manufacturing environment. We wonder how companies will launch new products in 2021 with what is happening in 2020.”
Right now, manufacturers agreed they’re experiencing the most disruptions in pocket springs, nonwovens and ticking – with none in foam. Nonwovens are a vital component in mattress manufacturing and, aside from pocket springs, are used in the flange, quilt backing, dust cover, some FR barriers and elsewhere. (See sidebar below.)
A common thread among mattress producers was the necessity to source pocketed coils and nonwoven products overseas.
An independent producer said he is largely unaffected by supply shortages because he shops “around the world” for everything and always has. “With a diverse supply chain, our lead times for finished product have gotten back to where they were (pre-pandemic), although at first they were as much as 10 to 20 days,” he said.
A major manufacturer said of the current situation: “You have to go outside the country to get what you need. We’ve always sourced domestically, but so many overseas companies are contacting us now.”
He also called the current sourcing situation “a mess at epic levels. We’re exhausting every conceivable avenue to get components and materials,” he added.
A textile supplier said his global capacity has allowed the company to keep product flowing because different regions of the world have shut down at different times. That said, lead times on new orders (not existing programs) can be six to eight weeks. Previously, they were three weeks.
A large, regional mattress maker said, “Getting what you need comes down to relationships with your suppliers and diversifying your supply chain around the world.” He added that “mattress fabrics are a challenge, all the mills are behind,” with lead times increasing 30% to 40%. To get around the pocket-spring shortage, he is trying to sell and ship more all-foam products, at least temporarily.
Others describe “extreme frustration” at supply chain unpredictability: Your best-laid production plans are foiled when you’re short a single component. How do you schedule production and get orders out the door when supplies are late, short or never arrive? they ask.
Lead times have lengthened across the board. Even trucking companies can’t be relied on for on-time deliveries. Some industry members have sent letters to customers explaining the situation and asking for patience.
Current conditions are a seismic shift for an industry reliant on its supply chain for flawless, just-in-time ordering and 24- to 48-hour product fulfillment to retailers.
Lack of labor
Manufacturers and suppliers said their plants are running at pre-pandemic levels with many seeking to fully staff and run second and third shifts, to keep up with demand.
“We’re running heavy and are staffing up for a second shift, but it’s difficult because people are making more on unemployment,” one major manufacturer said.
Labor shortages are a big problem. Most companies we spoke with said they are struggling to fully staff a second shift and industry suppliers who regularly run a third shift can’t.
Some laid-off workers aren’t returning because they found other jobs or are staying home to take care of children, whose schooling or care is disrupted. Absenteeism also is high.
Across the board, companies have instituted extra health and safety precautions, including mask wearing, frequent hand washing, plant sanitization and social distancing. Multiple, staggered lunch breaks are required to enable social distancing, etc. These measures are making production “slower and harder” and even affecting interpersonal communication and the effectiveness of company meetings.
But these are minor difficulties compared with the numerous plant closures due to large outbreaks of COVID-19.
Illness is exacerbating productivity problems, especially in states where the pandemic is uncontrolled.
Wherever possible, companies continue to allow those who can to work remotely. One manufacturer has found a way to allow sewing staff to work from home.
Salespeople have virtual customer visits and companies hold office meetings with as few people as possible while practicing social distancing.
One company is making the most of its first shift and keeping its plant operating seven days per week. Employees get a bump in salary and work in overlapping rotations, four days on and three days off.
“The pandemic has proven just how valuable your people are,” a manufacturer said. “We knew that before, but it’s ever more obvious now. … Some companies that didn’t value hiring quality people or didn’t train them properly, are really struggling now with those decisions.”
Mattress manufacturers and their suppliers have found themselves competing with the vitally important medical market for the type of nonwoven spunbond polypropylene used to assemble mattresses and wrap around pocket springs. Nonwoven supplies around the world are stressed because there is unprecedented demand for personal protection equipment stemming from the global pandemic. In addition to the medical market, need for nonwovens is soaring in hygiene products, such as wipes.
In the domestic bedding industry, a handful of suppliers source and convert the type of nonwoven spunbond polypropylene used in pocket springs and as dust covers, filler cloth, flange and quilt backing.
The governments of China and India have taken control of some nonwoven producers in their countries to direct nonwoven output to medical applications. In the United States, the federal government has enforced the Defense Production Act to guarantee that critical supplies go to PPE production.
Further tying up domestic supplies of nonwovens, the Berry Amendment requires that products sourced by government entities under the Defense Production Act must be sourced entirely in the United States.
With the United States continuing as a COVID-19 hot spot, the need for PPE is growing, and it will impact mattress makers’ domestic supply chain for the foreseeable future. Bedding manufacturers and converters said they are researching substitutions for different types of nonwovens – such as spunbond polyester and stitchbonds – to make pocket springs and for use elsewhere in the bed. But the characteristics of different nonwovens vary and are not limited to weight, feel, performance, FR characteristics and price.
For an overview of what’s happening with nonwoven production globally, read “Nonwovens Supply Shifts: Investments target needs brought on by Covid-19 nonwoven category“. Read about the different categories of nonwovens in this Wikipedia entry, Nonwoven Fabric.