2014 December Business Climate
December Retail Sales
In early January, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth,barbecue and patio products, asking them to compare December 2014 sales to December 2013. The accompanying charts and selected comments are from the 202 useable returns.
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Weather Report |
Consumer Confidence |
Stock Watch |
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The strong sales year for hearth products continued through December. Sixty-two percent of respondents indicate they had a better December than in 2013. |
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13 MONTH YEAR-OVER-YEAR RETAILER SALES |
Hearth sales have now posted 36 straight months of positive month/year vs. month/year sales. The last negative month was in December 2012.
The last negative month for barbecue sales was in October 2012, 38 months ago, and the last negative month for spas was in November 2012, 37 months ago. Patio sales were down from the prior year in this month – December 2014.
Retailer Comments
Northeast
Connecticut: (Hearth) “BEST YEAR EVER! We ended the year up 10 percent over our biggest year in 2008. Nice surprise considering oil is half the cost of this summer. The long, cold winter last year drove sales for sure. We’re curious as to what 2015 will bring.”
Maine: (Hearth) “Too much discounting!”
Maine: (Hearth) “Surprisingly strong month. The seven days before Christmas were as busy as weeks in September and October.”
Maine: (Hearth, Patio, BBQ) “December sales were steady but down from 2013.”
Maine: (Hearth) “It seems every time I look around someone else is selling heating appliances. It’s a good sideline for a multi-product store, but getting more difficult for a dedicated sales and service heating business.” Massachusetts: (Patio) “Slow!!! However, we’re up 3.55 percent for the year so – Happy New Year!”
New Jersey: (Hearth) “Strong sales through the month, especially in the first two weeks. There was activity right through New Year’s Eve. We expect a good January if weather turns cold.”
New Jersey: (Hearth, Patio) “Great finish to a nice year. Very thankful for our customers and dedicated staff! Happy New Year! We’ll see what affect larger, deeper barrier screens have on our customers as we move forward.”
New York: (Hearth, Patio, BBQ, Spas) “We’re still struggling with wood pellet manufacturers. Not having a steady stream of pellets is hurting walk-in traffic and hurting sales.”
New York: (BBQ, Spas) “Average December activity following an excellent November.”
New York: (Hearth, Patio, BBQ, Spas) “The season leveled off after a great start. Since then it’s been slower, but steady.”
New York: (Hearth, Patio, BBQ) “We feel December sales were down a little because of the drop in our availability of pellets.”
Pennsylvania: (Hearth, Patio, BBQ) “Wow, just wow!”
Pennsylvania: (Hearth, Patio, BBQ) “Low pellet availability and low oil prices equal low pellet stove sales for December.”
Pennsylvania: (Hearth) “Very strong month for pellet sales, but availability of pellets, a mild winter and low oil prices will be a factor next year. The nail in the coffin would be a price increase on the stove.”
Pennsylvania: (Hearth, BBQ) “Having no pellets is starting to hurt sales and getting bad press on local news (TV, radio & print).”
Pennsylvania: (Hearth, Spas) “There’s no fuel to support pellet stove sales.”
Pennsylvania: (Hearth, BBQ) “Pellet availability and costs are worrisome. Customers are beginning to cringe at the retail price. Wood insert customers are back. Sales of inserts of all types continue to be strong. Traffic remained strong through the holidays, a normally slow period for us.”
Pennsylvania: (Hearth) “Gas log inserts and stoves went through the roof. Wood has dropped off by 30 percent and pellet by 48 percent. Gas is still king! Service is off the charts; we’re beginning to say no to units that we don’t sell; overworking our service team is not good for business. Product shortages are now becoming a royal pain in the a-- and pellet fuel suppliers lie like rugs.”
Weather Report
For the following weather charts, the numbers for each state reflect the temperature ranking for the period since records began in 1895.
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This month, the western and eastern ends of the country experienced Much Above Normal temperatures; the rest of the country was Above Normal. Nationwide, December 2014 was the second warmest month since 1895. |
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During the three-month period from October to December, only Illinois experienced Below Normal temperatures. Once again, the far west and New England were Much Above Normal. For the contiguous U.S., it was the 16th warmest October – December in 120 years. |
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The glaring red of California, Nevada and Arizona leaps from the page as those three states just ended their Record Warmest year since reporting began in 1895. Nationwide it was the 34th warmest calendar year. |
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South
Arkansas: (Hearth) “Strong hearth sales finally. Best month of 2014.”
Arkansas: (Hearth) “Rain slowed down building this month. Retail is holding strong. Wood inserts are the key thus far.”
Florida: (Patio) “Year was practically dead-on with 2013.”
Georgia: (Hearth, Patio, BBQ) “Historically, Big Green Eggs are a big part of our December sales. This year it seems as though the market is so over- saturated that sales were way off. Gas logs and glass fireplace doors have done very well this season.” Louisiana: (Hearth) “December was good for individuals building their own homes. Gas log sales were really up because of colder weather. Looking forward to a great 2015.”
Louisiana: (Hearth, Patio, BBQ) “Early cold snap increased hearth product sales but lowered sales in other departments. Luckily we have a wide assortment of gift items for the Christmas shoppers.”
Oklahoma: (Hearth) “$39,096 December 2013. $82,242 December 2014.”
Tennessee: (Hearth, BBQ) “Had a good December. Last year’s was great and November 2014 was great, so made December look a little down. No complaints.”
Virginia: (Hearth, BBQ) “We still consider it a good month. It’s been a good year.”
Midwest
Indianapolis: (Patio, BBQ, Spas) “It seems that, with gas prices dropping, we’re seeing people with extra money in their pockets looking for upgrades to their lifestyle; these are people that we haven’t seen or heard from in a long time. The economy in our area has taken off again for at least now and the spa and pool side of our business is showing signs of life again. The patio and barbecue items might be gone for good except for built-in and custom applications.”
Michigan: (Spas) “Damn the retailers who opened up stores on Thanksgiving. Hot tub units were up from 2013, but margins were lower per unit, so we were up and down all in the same month. But we made sales. Lights are on and everyone, including me, got a bonus.”
Minnesota: (Hearth, BBQ) “I don’t know what it’s credited to but wood sales have been stronger this season than in the last couple of years.”
Missouri: (Hearth, BBQ) “Hearth product sales off slightly with the mild weather. Barbecue sales up significantly.”
Missouri: (Hearth, Patio, BBQ, Spas) “We’ve had an incredible 2014. It’s such a relief to see numbers looking like ‘pre-recession.’ Now that we’ve been open 10 years, we’re finally feeling like we’re getting it figured out – little by little.”
Ohio: (Hearth, BBQ) “Our tenth year in business has by far been the best. Direct-vent inserts and fireplaces have been incredibly strong. We will try to capitalize on the growing fireplace re-face market in 2015.”
Ohio: (Hearth) “Saw a definite drop in activity due to warmer weather, holidays and low gas and oil prices. Still finishing up installs from earlier sales.”
Wisconsin: (Hearth) “Strong finish to a terrific year. Strong sales across all categories – wood-gas-pellet-electric.”
Wisconsin: (Hearth, BBQ) “Wonderful end of 2014! At this time there is a significant amount of work booked for 2015.”
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A reading above 90 indicates the economy is on solid footing; above 100 signals strong growth. The Index is based on a probability-design random sample conducted for The Conference Board by The Nielsen Company.
The Index is based on a probability-design random sample conducted for The Conference Board by The Nielsen Company.
West
Alaska: (Hearth) “Our weather has been warm, which slowed sales. We moved to a much better location, which helped sales. We don’t have the type of clients to buy patio stuff in this part of Alaska. We are dependent on the oil industry, which is laying off workers.”
California: (Hearth, Spas) “Down from last year! Traffic is great, getting customers to make a decision is another story. Still lots of fear and questions.”
California: (Hearth) “Sales and installations were pretty easy, no major hiccups, but slightly down over last year. We were surprised to hear that another hearth store will close its doors mid-January.”
California: (Hearth, BBQ, Spas) “Need good cold/wet weather in California to get things back on track. In our area it takes the economy a few extra years to bounce back and we’re still waiting to see the results.” Hawaii: (Patio) “December 2013 was a terrible month. December 2014 was only average, at best.”
Idaho: (Hearth) “Our sales are up to a point of almost being as good as a bad December before this administration.”
Washington: (Hearth) “Closed out a solid, not spectacular, year.”
Washington: (Hearth, Patio, BBQ, Spas) “Warm December.”
Canada
Alberta: (Hearth, Patio, BBQ) “Even though our closing ratio was up we did notice the average consumer’s confidence was down. Reason for this is oil prices being at an incredible low. A lot of our closes were on higher-end products. The higher-end products are always in demand with the consumers that have the cash, especially when they sense a slowdown in the retail sector. This is why it’s always important to stay in tune with the continually changing market and be able to adapt quickly. Realizing that there is always an opportunity out there is how we recognize and capture it!”
British Columbia: (Patio, BBQ) “December is very unpredictable for us; it depends on the weather and mostly on what is new in the tech world. If there is new stuff in the tech world, more customers will go to the new tech toys for Christmas gifts from stores like Best Buy. We had a very good increase in 2013 from 2012 and so the same as 2013 in 2014 is very good for us. We are busy with receiving all the early-buy booking orders and that keeps us very busy in December.”
Manitoba: (Hearth, Patio, BBQ) “The lack of availability of wood chimney has slowed down sales. Good year in barbecue, just not in December.”
New Brunswick: (Hearth, BBQ) “December continues to show high interest in wood stoves. Weather was not as extreme as other years, very little snow fall. Customers still looking for backup heat in power outages.”
Ontario: (Hearth, BBQ) “December sales were reminiscent of the pellet stove boom year. We do 100 percent solid fuel. Could have been even better if manufacturers of venting, in particular, and stoves to a lesser extent, had been ready. I have nine installs of pellet stoves waiting for venting to arrive, sometime in 2015. With one manufacturer it’s lengths, the other fittings. Never thought I would have to resort to three different manufacturers for venting to do a week’s work. However, how can you complain in a year when we sold everything we could install.”
Ontario: (Hearth, Patio, BBQ) “Temperatures below zero, and memories of power failures and bitter cold from previous years drew procrastinators out of the woodwork.”
Stock Watch
| COMPANY – EXCHANGE | SYMBOL | 52 WEEK | Week Ending | % CHANGE | MARKET CAPITALIZATION | ||||
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| High | Low | 28-Nov-14 | 26-Dec-14 | 4 Week | 26 Week | 52 Week | ($000,000) | ||
| HNI Corporation (a) | HNI | 52.90 | 31.00 | 46.94 | 51.53 | 9.8% | 32.3% | 30.9% | $2,240.0 |
| Pool Corporation (b) | POOL | 64.71 | 51.61 | 59.41 | 63.39 | 6.7% | 9.7% | 9.3% | $2,740.0 |
| Restoration Hardware Holdings (a) | RH | 100.66 | 54.61 | 84.47 | 96.00 | 13.6% | 3.9% | 48.5% | $3,770.0 |
| Wayfair, Inc. (a)(c) | W | 39.43 | 16.74 | 24.26 | 20.31 | -16.3% | NA | NA | $1,830.0 |
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(a) = New York Stock Exchange |
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