The decline in US merchandise sales in the first quarter of 2026, down 8% in units and 3.8% in dollar terms, according to the International Sleep Products Association, has affected the mattress market, as well as the fashion bedding sector, or the soft goods industry.
“While underlying demand remains tight, pricing and product mix continue to provide some relief, as unit prices increase by mid-single digits,” the International Sleep Products Association said in a statement.
A challenging retail market, which has impacted product demand, combined with financial issues involving affiliated companies has forced soft furnishings supplier Simply Interior Homes to file for bankruptcy protection.
Simply Interior Homes, supplier of home furnishings and home decor products to designers, files for Chapter 11 bankruptcy.Shutterstock
Simply Interior Homes files for bankruptcy
Simply Interior Homes LLC, which designs, sources and supplies home textiles and home decor products to major retailers and designers, such as Kate Spade, has filed for Chapter 11 bankruptcy to reorganize its business and seek the sale of its assets.
Rock Hill, SC-based lenders filed their petition on June 8 in the US Bankruptcy Court for the District of Delaware, listing assets of $100 million to $500 million and liabilities of $100 million to $500 million, after financial disagreements with the company’s founder Center Lane Partners and its affiliate, according to the court’s Live Comfort.
The debtor was formed in early 2025 when Center Lane Partners spun off the soft goods business from a subsidiary of Keeco LLC, which had a mortgage facility at the time, created a new organization called Simply Interior Homes, and rebranded Keeco as Live Comfortably.
The debtor blames the parent
The debtor blamed his bankruptcy on a cashless balance sheet from the beginning of the business recording, the failure to make more money, mergers and acquisitions, and financing efforts led by Center Lane Partners, and the refusal of the parent company to provide the necessary funds and financing to Simply Interior Homes before such court cases, failed.
A spokesman for Center Lane Partners could not be reached for comment.
“I have been advised by the SIH management team that due to the adverse change in the financial situation of the opening of the debtors and the failure of the filling rate at Keeco, the newly appointed management of the debtors has had to immediately revise the 2025 receivables income plan from $185 million ultimately down to $86 million,” said the Internal Foreclosure Officer Adam.
“Overall, the debtors began to exist as an insolvent business with a damaged customer base, excess and outdated inventory, no cash, and more debts and payments than expected, which created a fundamental deficit in which the debtors worked for more than a year but could not fully repay,” said Zalev.
A major financial burden on Simply Interior Homes was the transition services agreement it entered into with Live Comfortably in 2024 that provided back office and certain operational functions to Live Comfortably, including information technology, finance and accounting services including accounts receivable, accounts payable, business accounting, financial planning and analysis, tax compliance and finance.
Due to delays in the official name change through the Internal Revenue Service, the debtors’ setup of new merchant accounts with large customers has been delayed, forcing them to rely on Live Comfortably to receive and send customer payments owed between 2025 and 2026, according to court documents.
The debtor claims that the affiliate company has withheld payments
Live Comfortably is accused of delaying repayments to Simply Interior Homes despite the debtor’s repeated requests for timely payment, court documents say. Debt customers sent over 75% of Simply Interior Homes collections to Live Comfortably accounts from January to May 2026, with values ranging from $300,000 to $1.5 million per week.
During the week ending May 31, 2026, Live Comfortably allegedly received $311,000 in payments from the debtor’s customers that were expected to be sent to the debtor in a timely manner, but as of June 7, Live Comfortably had not sent the money to the debtor, court documents said.
The deal resulted in higher costs for the year
The debtor said it is still dependent on the services provided by Live Comfortably and has not completed the transition to a fully independent, independent operation. Under the transition services agreement, the debtor is also responsible for a significant cost burden that includes annual costs of more than $2.7 million.
The debtor and Live Comfortably are said to be involved in a dispute over amounts owed under a transition service agreement, with Live Comfortably threatening to terminate the agreement and terminate services to the debtor, resulting in a Chapter 11 bankruptcy filing.
Related: Mattress giant to sell chain in Chapter 11 bankruptcy
This story was originally published by TheStreet on Jun 13, 2026, where it appeared first in the Marketing category. Add TheStreet as a favorite source by clicking here.
