"Factory" -building where goods are manufactured, a building or complex of buildings where goods are manufactured on a large scale,e.g, an automobile assembly plant."
"Factory Direct" is an extention of the the term factory to designate a factory that sells direct to the ultimate consumer not thru distributers and retail stores. The obvious benefit being the elimination of intermediate markups in price, allowing the consumer to buy at a much lower price.

As of 2006 there were approximately 1800 mattress manufacturers in the United States including the largest producers such as, Sealy, Serta, Spring Air, Simmons, Tempurpedic, and Select Sleep. The remaing manufacturers create their own brands and range from very large multi-millon dollar facilities down to one person operations. One can get into the mattress manufacturing business with two pieces of machinery, a tape edge and a sewing machine, costing under $15,000.

  In the market place it is a common assumption that if the product costs more then it must be better and conversely if it is selling very cheap the product must be of inferior quality. This is not necessarily true when it comes to "factory direct" mattress manufacturers. The "factory direct" competitative advantage over the major mattress manufacturers is cutting out middleman markups, which are added by a retail store in order to cover their operating expenses as well as make a profit.

  A rule of thumb would be as follows. Lets say a major manufacturer such as, Sealy, Simmons, Spring Air, Serta manufacturers a mattress called Cloud 9 and sells it to a retail mattress store (sleep shop) or department store. These are distribution channels which have to make a profit. If our mattress wholesale cost to these distribution channels is $500 these businesses will at least double the price to $1000 in order to cover overhead such as rent for premium locations, advertising, salaries, commissions, and delivery of product to customers. They must at least double the price in order to stay in business.