Love at first sleep
Ranked number one in the Sunday Times’ Profit Track 100, Dreams, the UK’s leading bed specialist, has made sizable investments across the business, as it looks to build on the phenomenal growth it has achieved in recent years
Five years after Dreams was rescued from the daunting prospect of entering administration, life for the British bed and mattresses retailer has turned into a tale of continuous success. Since that watershed moment in 2013, when Dreams’ new owners, private equity firm Sun European Partners, took the helm of the organisation, the company has aimed to reposition itself as an ‘expert in sleep’, focusing on offering quality beds and an unrivalled standard of customer service.Today, Dreams employs over 1900 staff and manages a network of nearly 200 stores all over the UK, with its headquarters aptly renamed ‘Bedquarters’ based in High Wycombe. Boasting a capacity to manufacture over 200,000 mattresses and 160,000 beds per year from its two factories in Oldbury, Dreams has confirmed itself as a trustworthy supplier nationwide, selling approximately 10,000 mattresses, bases, and headboards every week, and being rated the UK’s most recommended bed retailer on Trustpilot.
The figures for 2017 make a pleasant read for everyone working at Dreams.The business reported a solid 7.2 per cent growth in sales, hitting the £300 million mark. In the meantime, eight new stores were opened and further 23 were refurbished.The systematic retrofit of Dreams’ stores is part of the business’ ongoing commitment to be consistent in ensuring the best possible customer journey, be it in-store or online. It also reflects the strategic approach taken a while ago to move to smaller, brighter stores, in order to reduce the company’s rent bill further. Additionally, Dreams took care of its fleet of distribution vehicles last year, investing £2.5 million to support its home delivery service.
If you needed further proof that 2017 was one of the most successful years in the history of Dreams, then how about the news that came in just recently that the company topped the Sunday Times BDO Profit Track 100 table for 2018.The astonishing 166.89 per cent annual profit growth is clear-cut evidence that the business is on the right track and has made the right choices for its development in the past years.
“The recent growth we have experienced, meant that we had to expand.We used to have just one factory in Oldbury, whence we were producing everything, but we have now got a second unit. Having separated the production of the different parts between the two facilities, we have certainly improved the quality of our products. In the first factory, we manufacture the roll mats and the mattresses, while the second one makes the headboards and the bases.We run one production and one dispatch shift, which means that we manufacture the product during the day and send it out at night time,” Dreams’ Director of Production, Michael Hargreaves explains.
“We have invested over £1 million to re-lay the factory and bring in new machinery and technologies in order to make it more efficient,” he continues, insisting that the company considers its meticulous quality check procedures as a significant contributor to its success.“We have our own quality team, situated in the factory, so that we can quality-check every product that leaves it.We have a very rigorous in-line quality inspection process, and the results of it can be seen in the under one per cent returns rate we have achieved. As a point of reference, the standard returns rate across the industry is two per cent,” Michael maintains.“What is more, when a product is returned, we can identify who its supplier was, and we can send it back to them to ensure that they do not repeat the same mistake in the future.”
Having found it challenging to engage qualified employees, Dreams has decided to raise the qualifications of its current workforce, by setting up an in-house training scheme in mid-2017. “Everybody in the factory is given the opportunity to progress and become more skilled at the job they do. Even those who start at a basic level can still climb up the ladder through proper training, and become a more skilled operator.We are one of the very few factories to do that,” Michael remarks.
We often hear that ecommerce has grown into a dominant trend to reckon with, even in markets where traditional, physical shopping would be expected to still have the upper hand. Judging by the focused efforts of Dreams in the digital side of its business, we can assume that online shopping has become a central point of consideration in the industry. Dreams made notable strides in the digital space in 2017, which resulted in an increase in ecommerce sales by 15 per cent. Furthermore, the company has made a strategic £1.8 million investment in a new web platform, in a bid to establish online leadership. The move has since proven to be a sensible one, as Dreams reported 18.2 million website visits after it launched the updates to its digital offering.
The beginning of 2018 brought about a new business partnership for Dreams.The retailer announced that it had been collaborating with the most popular website for parents in the UK – Mumsnet, with a view to produce a range of mattresses designed for parents and parents-to-be.The outcome of this partnership was the launch of two new mattresses (one medium and one firm) that were produced by Dreams in its Oldbury factories, and have been available to customers since April.
The Spirit Mattress combines 2000 individual pocket springs and a luxurious layer of latex for added comfort and pressure relief. In addition, the medium mattress is treated with Fresche technology, so that it is purely anti-allergy, ensuring an irritation-free sleep.The Spirit mattress also possesses naturally breathable and temperature-regulating properties, which contribute to the overall feel of support it provides.
As the firmer version of the two, the Kindred mattress brings together 3000 individual pocket springs and natural cotton and wool layers for breathability and a high degree of moisture control. Similar to the Spirit variant, this model claims to have powerful antibacterial qualities, thanks to the natural alpaca and bamboo layers it has incorporated in itself.
The development of Dreams’ TEMPUR CoolTouch Collection has also been highlighted as a significant recent milestone for the business. The unique TEMPUR material woven into the mattress cover keeps it cool to the touch, while absorbing excess heat during sleep, thus enabling weightless comfort and support for the entire body. As a pressure relieving material, it naturally conforms to the body shape, evenly distributing pressure across the surface.Then, due to its open cell structure, the mattress returns to its original shape once the pressure is removed.
Further diversifying its market proposition, Dreams formed a new brand, called Hyde & Sleep – a ‘bed-in-a-box’ subsidiary, which uses the world’s most advanced materials to make supremely comfortable mattresses that suit different body types. Each mattress is then compressed and rolled to fit in an easily transportable box, which is shipped to customers at no delivery cost.To perfect its business offering, Dreams is planning to roll the mattresses into its stores in early July, as they are currently available only online. Moreover, it will also offer customers the so called 40 Night Comfort exchange option, meaning that if one is unhappy with their mattress, they can exchange it within 40 nights.
Quick to react to changing market conditions and relying on the fruitful business partnerships it has engaged in, Dreams is looking to the future with calm and confidence. If the dynamicity of its activities during the past 18 months is indicative of how busy the company will be kept in the coming years, then we can expect to hear a lot from the bed manufacturer, as it continues to provide its customer base with innovative and comfortable products.
Products: Beds and mattresses