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Mr Sandra Musk

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Ohio Mattress Co.'s takeover of Sealy Inc. last year capped a Decades-long struggle between Ohio Mattress and Sealy and finished one of the most interesting chapters in the bedding business's best futon mattress.

However, for Ohio Mattress, headed by chairman Ernest Wuliger, a radically Different age is just starting. It'll test Ohio Mattress's capacity to manage and inspire the newly acquired Sealy company, which had mostly been a certified team.

And, based on Wuliger, It Is Going to indicate the ending of intrabrand Contest--a plan that formed the bedding business for decades as well as some say, helped propel Sealy into the top in earnings--one of the plants which currently constitute Ohio-Sealy.

"First, We Must see where the company has been Done," explained Wuliger. "We'll be moving the company into the plant closest to this marketplace. We'll be analyzing the capacity of this plant. Sealy plants have spanned into each others' lands for into a marketplace. This has occurred over several decades. We are analyzing where are the sensible change. Now Boston will not be competing with Oakland."

Last June's conclusion by a Chicago jury to award Ohio Mattress that a Startling $77 million in compensation from Sealy Inc. for antitrust offenses given the impetus for seven crucial Sealy licensees to agree to sell their holdings to Wuliger.

Former Sealy president Howard Haas, backed by Chicago financiers Jay and Robert Pritzker, allegedly produced a $250 million proposal for those licensees shortly after the jury conclusion. But, Wuliger's $258 million proposition, coupled with his deal to spare the licensees from paying the compensation, finally swung their conclusion his manner.

In little over a flash, Ohio Mattress had doubled its size. With the buy, it gained 82% of Sealy's inventory and gained control of the licensor, which possessed 16 manufacturing centers and accredited 10 overseas and two staying domestic bedding organizations to generate Sealy-brand solutions.

Fiscal 1986 earnings of just under $300 million have been projected to balloon to between $600 million and $650 million in 1987. Wuliger quotes that his Sealy company "has near a 25 percent market share."

And the company continues to grow In February Ohio-Sealy Announced it would boost its possession of Sealy to 94 percent using its agreement in principle to purchase Sealy Mattress Co. of Michigan Inc., among the two remaining nationally Sealy licensees. Michigan Sealy had Sealy-brand earnings of about $12.5 million in 1986.

"This is a large job incorporating Sealy and the licensees to The company," explained Wuliger, record Ohio Mattress's priorities because "gross profits and prices, employees, and shipping--placing the company at which it belongs. We are determining what type of company we'll have and the best way to put it all together.

"We Will Need to Check out the acquisitions and get them integrated. We will need to move the company into the plant closest to where it is being done. We will need to check at the Chicago office--determine how it fits in, the way the people today match in. We will need to check at the folks in the licensees, find who is going to be the ideal fit."

Wuliger said incorporating the plants may involve consolidation.

"We are searching for ways of streamlining," he explained. "We might find we have more crops than we want. We do not have that pegged out"

Competitors point out the tail possesses the puppy, the Business has a lot to be concerned about. They notice that in decreasing the size of their company Wuliger might have bitten off more than he is going to have the ability to chew for quite some time.

"They have a huge amount to do," stated one executive. "There is certain to be some slippage. We are doing just as far as we can to make the most of this."

The issue for Ohio Mattress is aggravated, they state, because Wuliger is basically a one-man show. "He's light on direction," stated one department store buyer.

In accordance with Wuliger, however, this understanding is totally inaccurate. "I didn't pursue the lawsuit for 15-1/2 decades," he explained. "However, the transaction has tended to believe I conduct this business with a iron hand.

"It is time to tell the narrative of the business," he explained.

That narrative basically includes six branches, All which Report on Ron Trzcinski, 42-year-old president and chief operating officer of Ohio Mattress, who joined the firm as assistant to the president in age 26. Both of the other attorneys from the existing Sealy surgery are Steve Kneeland, president of Ohio-Sealy as 1986, who joined the business as a sales rep in 1968, and Richard Roe, former group vice president beneath the older Sealy, Inc. regime and currently vice president and general director of Realtors together with Ohio Mattress.

Kneeland heads up operations and marketing for All the Sealy plants owned by Ohio Mattress. Roe directs lots of corporate places such as national reports, contract sales, the Sealy spring surgery--that was possessed by the prior Sealy Inc. firm--and present national and overseas licensing operations.

"We are putting together the Sealy company," stated Trzcinski. "We are working out the way to conduct it. People today will need to understand what their fundamental responsibilities will be. If you do not understand, you stagnate."

The other branches under Trzcinski's umbrella are Stearns & Foster Bedding, innerspring maker; Advanced Sleep Products, producer promoted under the brand names Monterey and Wavecrest; Woodstuff, waterbed furniture maker, and Stearns & Foster Upholstery.

In this arrangement, Wuliger's function is to remain near the marketplace. "My function will be largely advertising," he explained.

Competitors notice that maybe among the most Troublesome challenges Ohio Mattress faces is maintaining the plants as eloquent and competitive since they were independent, entrepreneurial businesses. "People work differently if they work for somebody else," said one executive.

Wuliger had little to say on this, noting that "Ohio Mattress includes a benefits program which will be provided to new workers."

Said Trzcinski: "We strive to give plants liberty--a great deal of The freedom they'd as independents. There's a danger in conducting them out of Cleveland. We've got a bonus program. We have had it all together with Ohio-Sealy and Stearns & Foster.

"The energy of a large company is programs and plans," he said. "A large business may be the best of both worlds"

Rumors indicate that a Significant shake-up from the Chicago office is Underway, and Wuliger would just say no decision has been made about going Sealy headquarters to Cleveland.

In the plant level, Trzcinski said very little will change as a Result of this Ohio Mattress takeover. "With the exclusion of these owners walking apart, the companies have been intact," he explained. "There will not be much of a shakeup. The crops which ran quite well will proceed along as they've been. There will be lots of changing in how they conduct their company concerning distinct reports, things like this. Some people could leave, they will not enjoy how we do matters. But that always happens."

"Most of these owners have been gone," said Kneeland. "The men and women who reported report to us"

Competitors and merchants are all waiting to see how Ohio Mattress Will handle pricing for Sealy merchandise.

The business started directly competing with additional Sealy licensees within their niches for Sealy-brand earnings around 1970, when Sealy Inc. started working out its right of first refusal and purchasing a few Sealy licensees, preventing Ohio Mattress from growing by obtaining those plants.

To contend, other Sealy licensees started using the exact same strategy. Sealy licensees were proven to undercut every other regularly in a variety of markets on cost. Many retailers were reported to have no fewer than four distinct Sealy cost lists from four distinct Sealy plants.

This intrabrand competition among Sealy licensees was imputed With pushing down costs across the business. Many also think, nevertheless, it assisted Sealy grow into the most popular area in bedding earnings by spurring fresh, competitive marketing and advertising campaigns.

"Sealy climbed through the span of intrabrand Contest," explained Wuliger. "Was it due to it regardless of it? We are not ready to answer this."

Competitors and merchants were happy, then, when the Ohio Mattress Acquisition was announced--mostly, they explained, as it would stabilize business pricing. "We expect him increasing Posturepedic cost points into some higher degree," stated one big merchant. "Everybody's waiting for him to do this. They will go in any way he belongs."

"It is not that promoted retail price factors are shifting, But different product has been offered for all those price points," said one competitor. "It is healthy to not have ridiculously low rates for premium"

1 manufacturer asserted the ending of intrabrand competition will Give different manufacturers the chance to undercut Sealy pricing, something that they could not do efficiently when Sealy crops were undercutting one another so harshly. "In the past, other producers have appeared less than competitive," he explained. "Now we will look more competitive"

However, other producers surfaced. "Our focus Isn't to Compete at the promotional end of this premium company," one stated.

Ohio Mattress should now determine the level where Sealy pricing Decisions ought to be made along with the cost changes which will happen with present Sealy products. Wuliger explained no decisions are made on pricing. "We must figure out that," he explained. "We intend to own Sealy a very aggressive competition"

"We have not addressed the pricing problem," stated Kneeland. "We must be aggressive in the market, do what is good for both parties."

Trzcinski noted that "historically, we have put pricing Guidelines and allow the plants pick. Plants do not all take the very same products anyhow--that the Northeast, by way of instance, conveys very company products. I have always felt we had been decentralized. We've got ten commandments--the principles they need to live "

With nearly All the Sealy company under his management, Wuliger currently has two national brands--Sealy and Stearns & Foster--to place. Sealy's wide supply in a plethora of channels for example unconventional retailers as warehouse clubs--a supply so broad that merchants have complained they must dismiss costs, which cuts in their margins--has abandoned any competitions to speculate Wuliger will place Stearns & Foster over Sealy from the market.

"Stearns is regarded as an upscale lineup," stated Wuliger. "top department stores see it as a upscale line. It's less supply compared to Sealy."

He explained, however, "They are different selling organizations, Completely different. They compete with one another like another competitor. I believe retailers are making great margins with Sealy. Our task will be to make it appealing, whatever it takes."

Wuliger said he will continue to show up on Stearns & Foster Advertisements, and consequently won't perform Sealy advertisements.

While the play of this Sealy takeover Might Be over, difficulties may Continue to linger for a while. Litigation continues, but this time with Ohio Mattress because the suspect. Ohio Mattress had suggested the minority shareholders of Sealy get an aggregate of about $10.5 million, according to exactly the exact same per share amount paid in relation to the acquisition of management of Sealy in December.

Back in February, Sealy Mattress Co. of New Jersey, Inc., that could Become the only independent Sealy licensee following the purchase of Sealy Michigan, sued Ohio Mattress, seeking to enjoin the merger that would lead to Sealy Inc. getting a wholly-owned indirect subsidiary of Ohio Mattress. Ohio Mattress known as the suit without virtue, and stated it would aggressively defend it.

Looking forward, Wuliger confessed that "the debt from the Sealy acquisition will drain Ohio Mattress gains," but added, "It is premature to attempt and select a figure for 1987. We anticipate the very best year ever. We are going to try to do everything better. Our priority today is using the plants"

PHOTO : ERNEST M. WULIGER,; Chairman and CEO,; Ohio Mattress

PHOTO : "We must determine where the business has been done . We'll be moving the company into the plant nearest to this marketplace ... Boston will not be competing with Oakville."

PHOTO : "We strive to give plants liberty. There's a risk in Running them out of Cleveland."

PHOTO : Steve Kneeland, president Ohio-Sealy, heads up Plant; marketing and operations to get; Ohio Mattress' Sealy; business.

PHOTO : Richard Roe, vice president and overall manager of; Licensed Realtors, headsup a; bunch of corporate purposes; such as nationwide Accounts; such as the innerspring bedding; brands, spring surgeries,; and futon mattress queen.