Consumer Alert - School Mattress Sales

Buyers Beware of the Mattress Fundraiser

Shop with reputable retailers; donate directly to charities instead

By Christine McCue

It's no secret that public schools are confronted with funding challenges, especially in low-income communities, and that programs like music and athletics are often among the ones hardest hit by budget cuts.

When a need for additional school funds surfaces, it often doesn't take long for fundraising activities to follow, making controversial mattress fundraisers organized by Custom Fundraising Solutions (CFS), an affiliate of the beleaguered Mattress Firm, difficult for some schools to resist.

Companies like CFS, which promise a portion of sales proceeds to schools or charities, are considered "commercial co-venturers" which are highly regulated in some states, including Massachusetts.

Here are the top three concerns about CFS mattress fundraisers:

1. Evidence of lack of compliance with a variety of state business and/or tax laws. Examples:

·       In Massachusetts, only one of the four CFS affiliates currently running mattress sale fundraisers can be found in the online Massachusetts Secretary of State Corporate Database at the time of this writing. At least one unlisted affiliate, CFS-Boston, is currently being scruitinized by the Massachusetts Attorney General Office.

·       Also in Massachusetts, it's virtually impossible for consumers to verify how much money school programs/charities and CFS affiliates independently earn from the fundraising events since mandatory financial filings for CFS-Boston could not be located. In contrast, it didn't take long to find online a North Carolina report in which CFS affiliates document their one-year financials.

·       Massachusetts law specifically regulates solicitations by commercial co-venturers like CFS-Boston, yet based on recent Facebook promotions and sales flyers, one cannot find all of the mandatory disclosures. And based on records received from numerous schools that held CFS-Boston sales over the past year, the name of the charitable partner publicized did not match the entity with whom CFS had actually partnered.

·       In Washington, a CFS entity received an “Assurance of Discontinuation” in 2015 to enforce the Consumer Protection Act.

·       In California, the West LA CFS affiliate was suspended by the Secretary of State/Federal Tax Board in 2015.

·       In Wisconsin, CFS was named in a Wisconsin Patch article as one of the top 20 2017 delinquent taxpayers with more than $58,000 owed to that state.

2. Consumer issues with CFS and mattresses in general. CFS has a C-Better Business Bureau rating and a number of complaints appear on the BBB web site,as well as on various CFS-affiliated Facebook sites. Overall, most complaints are related to lack of response to problems, but also product issues, including the delivery of a yellow-stained mattress in Massachusetts. A 2018 BBB research report also indicates that the mattress industry is among the top 150 out of about 4,000 industries in total based on number of complaints making mattress fundraisers an especially risky venture for schools and other charities. (If you want advice on how to buy a mattress, many credible articles have been published, with this link taking you to one of them.)

3. Long-term consumer risk. Custom Fundraising Solutions is affiliated with the Texas-based Mattress Firm, which has had its own share of controversy. Both companies emerged from bankruptcy less than a year ago, according to court documents. Mattress Firm brought on a new CEO in May, so it's too early to tell if CFS will be negatively impacted by future business decisions like restructuring or severing ties with affiliated companies. On its website, CFS lists its affiliated fundraising sales outfits across the U.S., with the most concentrated in CA, FLA, TN, OH and TX. However, official online business registrations indicate that in those five states alone, many CFS affiliates have ceased operation after only two years or less. In contrast, active mattress fundraisers continue to be held -- seemingly by the same entities that allegedly shut down. Given all of the findings noted here, consumers who make purchases at CFS-associated mattress sales events could discover their customer service point-person has disappeared leaving them (and possibly the charitable partners) to deal with any delivery, payment or product issues that might surface.

Beyond the legal, tax and ethical concerns related to CFS mattress fundraisers, including reports of high-pressure sales pitches to students and parents, the mattress sales events represent an ineffective, short-sighted fundraising model for schools, and especially so for music education.

Across the country, music education advocacy efforts have increasingly focused on ensuring that K-12 public school music classes are treated seriously like any other academic subjects taught during the school day. Yet CFS mattress fundraisers for music programs portray a counterproductive image, complete with uninspiring yellow and black lawn signs, and music students standing on street corners in mattress costumes holding them.

And while a portion of mattress sale fundraising proceeds may be earmarked for specific purposes (such as trip scholarships), it’s not unusual for school staff to tap into funds earned to meet other department needs – including school-owned instruments and facility enhancements -- which should be covered in the school budget instead.

A PTA.org article notes that integrity in fundraising is important, and that schools (and parent groups) should fully evaluate any company with which it considers partnering. The article further states that while companies want to be viewed as "good corporate citizens that support schools, it can be problematic for the school if the company is implicated in a scandal."

In the end, the best fundraising strategy for school groups is to focus on building local relationships that inspire people to donate to education and provide opportunities for students to demonstrate what they are learning (e.g., community performances and spelling bees). It's difficult to see how a “one-and-done” mattress sale affiliated with the controversial, out-of-town Custom Fundraising Solutions meets high-integrity charitable giving and educational objectives.

What's the bottom line? If you need a new mattress, skip the risky mattress fundraiser and shop elsewhere. Despite the "do it for the kids" sales pitch, no one can afford to make a 10-year investment in any product without doing some homework. Competition among mattress retailers is fierce with discount sales abundant (and mark-ups still reportedly high), so chances are strong that you can find product prices equal to or better than what CFS is touting -- especially when costs for delivery and removal of old mattresses are factored in.

And what about the students? If you care about helping to meet their educational and social emotional needs through programs like music and sports, donate directly to the applicable parent groups so that 100 percent of your generosity goes to where it is intended. In addition to money, a donation of volunteer time goes a long way too.

The author has more than 25 years of experience creating award-winning, corporate cause-marketing, volunteer, charitable giving and non-profit fundraising programs and is working on an initiative to provide pro-bono fundraising advice to music programs, especially in low-income communities. She is an associate member of the National Foundation for Music Education (NAfME), and an accredited member/past Boston Chapter president of the Public Relations Society of America.