If you’ve driven past a Factory Mattress store in Central Texas recently and noticed “Going Out of Business” signs in the windows, you’re not imagining things. The chain is in the process of closing all of its locations, and shoppers are understandably asking what happened and what it means for them.
This article covers what’s confirmed: the bankruptcy filing, which stores are closing, what to do if you have an open order or warranty, and how to avoid confusing Factory Mattress with other similarly named retailers.
Factory Mattress Has Filed for Chapter 11 Bankruptcy
Factory Mattress, which operates legally under the name Southwest Mattress Sales, Inc., filed for Chapter 11 bankruptcy on June 7 in the Texas Western Bankruptcy Court, Austin Division. The company has been a family-owned Texas business since 1977.
Chapter 11 typically allows a company to reorganize its debts and keep operating. But in this case, there is no reorganization plan on the table and no reported buyer or acquisition in the works. The filing is being used alongside a full liquidation of retail operations.
In plain terms: Factory Mattress is going out of business. The stores are not restructuring or planning to reopen under new ownership. They are winding down, selling remaining inventory, and closing permanently.
Which Stores Are Closing and When
All Factory Mattress locations across Central Texas are affected. Confirmed closing stores include locations in:
- Austin (Northwest, North, Southwest, and Lakeway)
- San Antonio
- Georgetown
- Pflugerville
As of the most recent reporting, closing dates for most stores are listed as TBD. Stores plan to remain open until inventory sells through, which means there is no single fixed end date. The San Antonio locations, for example, are expected to close “whenever inventory runs out.”
Going-out-of-business sales are currently underway across locations, with discounts reported at up to 80% off on select products including mattresses, bed sets, comforters, and sheets. If you’re considering shopping a liquidation sale, it’s worth calling your local store first to confirm it’s still open and to understand the current terms of sale.
Because this situation is still active, closure timelines can shift. Check directly with your local store or follow local news outlets for the most current information on final closing dates.
What Customers With Open Orders, Warranties, or Gift Cards Should Do
This is where things get more urgent. If you’ve already spent money at Factory Mattress, you need to take action now rather than waiting.
Undelivered Orders and Paid Deposits
If you placed an order and paid a deposit but haven’t received your items yet, contact your local Factory Mattress store immediately. Once a retailer enters bankruptcy and ceases operations, unfulfilled orders typically become claims in the bankruptcy proceeding. That means getting your money back is not guaranteed and could take significant time, if it happens at all.
The sooner you make contact and document your situation, the better positioned you’ll be if you need to file a claim with the bankruptcy court.
Gift Cards
Gift card holders face similar risk. Once a retailer closes, unused balances on gift cards may not be honored. If you have a Factory Mattress gift card, try to use it now while stores are still open and accepting purchases.
Mattress Warranties
This is an important distinction that many customers don’t realize: mattress warranties are typically issued by the manufacturer, not the retailer. Factory Mattress sells mattresses from various brands, and each brand carries its own warranty terms directly with the customer.
Think of it this way. If you bought a mattress from Factory Mattress that came with a 10-year manufacturer warranty, that warranty doesn’t disappear just because the store closes. You would contact the mattress manufacturer directly, using your original receipt or purchase documentation as proof of the sale.
So if you have a warranty concern, skip the store and go straight to the brand that made your mattress.
Final Sale Purchases
Items bought during a going-out-of-business liquidation often carry limited or no return rights. Before purchasing anything during a closing sale, confirm the terms clearly. Assume that all sales may be final unless the store states otherwise in writing.
The overall situation is not unlike what happens when a local department store files Chapter 11 and then decides to liquidate. Customers see the big discount signs, but behind the scenes, a court is managing how the company’s remaining assets are distributed to creditors. Shoppers benefit from the discounts, but they take on more risk if something goes wrong with their purchase.
Factory Mattress Is Not the Same as Mattress Factory or The Original Mattress Factory
There is genuine confusion online between several mattress retailers with similar names. It’s worth clearing this up directly, because the situations affecting these businesses are completely different.
Factory Mattress (Texas)
This is the Texas-based chain discussed throughout this article. It operates under Southwest Mattress Sales, Inc., filed for Chapter 11 bankruptcy on June 7, and is in the process of closing all locations across Austin, San Antonio, Georgetown, and Pflugerville. Its closure is the result of financial distress.
Mattress Factory (Pennsylvania and New Jersey)
Mattress Factory is a completely separate company based in the Philadelphia and South Jersey area. It is also closing all of its stores after 26 years in business, but the circumstances are different. According to reporting, the closure is owner-driven, attributed to retirement and increased competition from online mattress brands and national chains. This is a planned exit, not a bankruptcy-driven liquidation.
The two companies share no ownership, no affiliation, and no legal connection. One closing has nothing to do with the other.
The Original Mattress Factory
The Original Mattress Factory is a third, separate business and has publicly stated that it is not going out of business. The company issued an official statement specifically to address the confusion caused by news coverage of the other two chains. It continues to operate normally.
If you’re a customer of The Original Mattress Factory, the closures affecting Factory Mattress and Mattress Factory do not affect you.
Why Mattress Retailers Are Struggling
Factory Mattress’s bankruptcy fits into a broader pattern that has been putting pressure on regional, brick-and-mortar mattress retailers for several years. Online brands—often called “bed-in-a-box” companies—have captured a growing share of the mattress market by offering lower prices, direct shipping, and extended trial periods.
At the same time, national chains with larger marketing budgets and more locations have made it harder for regional stores to compete on price. Add in high retail rents and the fixed costs of running showroom-style locations, and the business model becomes difficult to sustain.
This doesn’t make the closure any less difficult for Factory Mattress employees, customers, and the communities the chain has served since 1977. But it does explain why the news, while sudden for many shoppers, is part of a recognizable industry trend.
For anyone navigating a business closure situation—whether as a consumer or an entrepreneur—StepToBiz offers practical guidance on understanding business decisions and what they mean in the real world.
Final Thoughts
Factory Mattress, the Texas-based chain operating under Southwest Mattress Sales, Inc., is going out of business. The Chapter 11 filing is real, the store closures are confirmed across multiple Central Texas markets, and there is no indication that the brand will restructure or reopen.
If you’re a customer with an open order, gift card, or deposit, act now. Contact your store, gather your documentation, and reach out to mattress manufacturers directly if you have a warranty concern. And if you’re shopping a liquidation sale, understand that final sale terms likely apply.
The situation remains active, so check local news sources and call your nearest location for the most current information on hours and closing dates. What’s confirmed today may change as inventory clears out faster or slower than expected.
Also Read: