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Mattress Firm Details Franchising Strategy, Expands Into Wisconsin

HOUSTON–Mattress Firm has signed a franchise agreement with Chuck Dawson, a former Sealy executive, for multiple stores in the Milwaukee and Madison, Wis., markets.

The new stores, which will open next year, are the latest in a move to expand the retailer’s franchise operations throughout the nation.

Gary Fazio, Mattress Firm’s chief executive officer, said the company developed a turnkey package for franchisees, which it introduced 18 months ago and which covers operations, point of sale, store design, deliveries, warehousing and accounting. The company now has eight franchisees in 18 markets throughout the nation, covering 64 stores in all. Its corporate-owned stores now total 481.

“Our franchise markets are generally under 1 million people, although there are exceptions,” Fazio said. “We want to run the stores in larger markets ourselves. But in smaller markets, it makes more sense to have local businesspeople run those markets. They live there and they know the markets better than we do, and it gives both them and us a better return on our investment.”

Fazio also said Mattress Firm plans to extend the turnkey program to satellite franchises within the direct market areas where there are corporate-owned stores. “There are cities within those markets that we want to franchise in, but we don’t want to manage those stores because they’re too far from our corporate-owned stores,” he said.

The company’s goal is to have another 100 to 150 franchise stores on its roster in the next three years. Eventually, Fazio said, the total number of Mattress Firm franchise stores could reach 350 to 400 in the years ahead. “We think the turnkey model will help us accelerate the franchise total,” he said.

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