2016 April Business Climate
April Sales
In early May, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, barbecue and patio products, asking them to compare April 2016 sales to April 2015. The accompanying charts and selected comments are from the 219 useable returns.
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Weather Report |
Consumer Confidence |
Stock Watch |
RETAILER SALES – U.S. AND CANADA |
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Only 15 percent of both Patio and Barbecue retailers were Down in the month of April, while 43 percent of Hearth retailers said they were Down. |
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13 MONTH YEAR-OVER-YEAR RETAIL SALES |
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For the sixth month in a row, Patio furnishings in the specialty retail channel were up substantially over the prior year. In April, they were up five percent, but that was minor compared to the 27 percent posted by Spa sales. |
Retailer Comments
Northeast
Connecticut: (Hearth) “Doesn’t look good for another year at least. Can’t imagine anyone in the Northeast having a good year.”
Maine: (Hearth, Patio, BBQ) “An early spring pause has passed, replaced with encouraging demand in the seasonal market.”
Maine: (Hearth) “At least it didn’t get worse than last year. However, both months of April in 2015 and 2016 are lower than in other years. Some questions I have: Is the market saturated? Are the Big Boxes taking over because of lower-priced China products? Is it because of the lower prices of oil, or too many people moving out of the area? Have to wait for fall and see what will happen.”
Maryland: (Hearth, BBQ) “Spring never really sprang this April. It didn’t help that we had reluctant weather and chillier temperatures. The great momentum we experienced in March ebbed away, but we are optimistic about sales coming back once the sun shines again!”
Massachusetts: (Hearth) “The building market has been very steady this year, which has given us a boost this spring. Retail has been slow over the past month, but we still have people walking in and looking at products, more gas than wood or pellet. The little wood and pellet we sold is due to Massachusetts’ stove change-out.”
New Jersey: (Hearth, Patio, BBQ) “A nice surprise for April. Hope to continue this trend in May. Always positive.”
New York: (BBQ, Spas) “Very steady traffic.”
New York: (Hearth, Spas) “Pools have had very good early traffic.”
New York: (Hearth) “Our year-to-date sales of hearth products are down about 25 percent, even though April 2016 vs. April 2015, we are up.”
Pennsylvania: (Hearth, Patio, BBQ) “Total revenue is up almost 40 percent. Some increase is due to several larger than usual jobs, overdue account receivable payments, good weather for seasonal masonry repairs and other anomalies. Overall, it was a good month with a good outlook for remaining spring and into summer.”
Pennsylvania: (Hearth) “GAS is King. Pellet and wood are totally out of favor. Folks are burning pellets but at about half the rate as in 2015. This was our first month of the year. First quarter was down by 15 percent. No winter to speak of and oil and gas prices at 1960 rates. Our time will come again.”
Pennsylvania: (Hearth) “Gas is where it’s at. Can’t understand manufacturers raising prices after a negative year in wood and pellets. It’s like putting another anchor on the Titanic!”
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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With a couple of exceptions (Vermont & New York), April temperatures in the U.S. were Near Normal and Above Normal, with California, Oregon, Washington, Idaho and Montana at Much Above Normal. |
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During the three-month period of February, March and April, the country experienced mainly Much Above Normal temperatures, with Montana posting a Record Warmest period. |
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During the month of April, seven states (Montana, North Dakota, South Dakota, Nebraska, Kansas, Oklahoma and Texas) experienced Much Above Normal precipitation. |
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South
Arkansas: (Hearth) “Not a very good month again. No floor traffic or telephone calls. People are not spending money so far this year. Our year-to-date sales are off over 50 percent so far. Not good news.”
Florida: (Patio) “Fewer customers, larger sales.”
Texas: (Hearth, Patio BBQ) “April showers started the second quarter off a little slower, but traffic was still up from last year.”
Tennessee: (Hearth, BBQ) “April seemed kind of sluggish, but when we added up the numbers, grill sales were up, fireplaces and gas logs were up, and, most importantly, dollar volume was up almost 15 percent over 2015. We will take a lot more months like that!”
Texas: (Hearth, Patio, BBQ) “Pellet grills are out-selling all other grills.”
Virginia: (Hearth, BBQ) “Record month. It was the best April in eight years. Wow!”
Midwest
Indiana: (Patio, BBQ, Spas) “We are definitely seeing an uptick in the economy this spring.”
Indiana: (Hearth, Patio) “Snow, hail, tornado (just one), heavy rain. Not a good month for sales.”
Michigan: (Hearth, Spas) “Gas inserts and freestanding stoves have been strong lately. Pellet and wood stoves are hit miss. Spas up a little. Below average temperatures this spring are helping to extend the stove season. Must be Global Warming!”
Michigan: (Spas) “Politics, cool weather and long spring breaks for schools made April sales flat. If hot, sunny weather ever shows up, prepare to work some 70-hour weeks; there’s so much pent-up demand in the market, we just need Mother Nature to cooperate. Manufacturers need to rethink their position on Internet sales. Look at the chain stores that are closing up shop. Strip malls where mom and pop retail stores were open for years are now vacant. When we get good weather we’ll be fine, but margins are being squeezed by Web sales. Get on the rollercoaster and ride. I’m worried.”
Michigan: (Patio, BBQ) “Mother nature sure has not made up her mind as to the season. We have experienced everything from snow to summer weather in the last month. Traffic is fickle, but we have sold much of our leftover stock from 2015 at discounted pricing to make room for 2016 stock.”
Ohio: (Hearth, BBQ) “While we’ve had some nice hearth projects wrap up in April, it has been a slow recovery from a heating season that ended shortly after Thanksgiving. Big Green Eggs have been selling well, but we need warmer weather to get the barbecue season really going.”
Wisconsin: (Hearth, BBQ) “Definite increase in sales. Could have been even more if there had not been some difficulties with deliveries. In our little niche of the industry, we usually do the total installation. Depending on the complexity of the install, the fireplace jobs are spread over many days. With the addition of another employee, jobs are being completed faster.”
Wisconsin: (Hearth, BBQ) “Very normal April in Wisconsin. Not like the last two years (never slowed down). Election years can be strange, but we’re not worried, it will pick up. Gas products are still selling strong, wood is not. Store traffic picked up the last week of April.”
Wisconsin: (Hearth, Patio, BBQ, Spas) “Overall sales were up 14.7 percent. Grills and fire pits made up most of the change. We had our anniversary sale in April that won’t be reflected until our May sales report. Filled up May and part of June.”
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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
California: (Hearth, Patio, BBQ, Spas) “We’re selling demo models, doing (small) early-buys and hoping our four-month up-swing continues.”
Colorado: (Hearth, Patio, BBQ) “April has started the in-between seasons, lots of lookers, ideas for the summer.”
New Mexico: (Hearth) “In 1978 when I entered this business, an old timer told me that in an election year, business is often off significantly. His words have proven true, at least for me. My national suppliers have shared with me that sales in rural America are stagnant, cities fare far better. There seems to be a general malaise in the market I sell to and service.”
Washington: (Hearth, Patio, BBQ, Spas) “Real slow.”
Canada
British Columbia: (Hearth) “April 2015 was big for us. This year we sold off a bunch of our demo models, which brought the overall dollars down, and we had a previous sale returned, which greatly affected our numbers this April.”
British Columbia: (Hearth) “Warmer than normal temperatures mean virtually no interest in hearth.”
New Brunswick: (Hearth, Patio, BBQ) “Started quite slow but finished up even with last year because of barbecue sales.”
Ontario: (Patio, BBQ) “The weather is a bit better than last year. Our currency is trading at .78 so I would expect that we will be working hard to beat last year.”
Ontario: (BBQ) “Our first quarter was terrible, but sales roared back in April. We’re up 140 percent over last April. Good weather equals great sales. We are now ahead of last year’s sales.”
Ontario: (Hearth, Patio, BBQ) “We had a cool, damp April. Still waiting for spring weather. I guess we will miss spring and jump right into summer weather. That’s the pits!”
Ontario: (Patio) “Bit of a slow start. Weather has been cool.”
Ontario: (Hearth, Patio, BBQ) “Barbecue sales suck. We have pulled whatever we could from all the other shops, which was four. We could have sold probably another seven or eight by now, but there’s none to be had! They stopped making the Vermont Castings – my main grill. I’ve had mine now since 2005, use it a lot, just can’t kill it. Too bad the manufacturers didn’t see they had something worthwhile keeping. They weren’t cheap offshore crap that you see in every Big Box store. I truly dislike this disposable era we live in.
“There, I feel better now. LOL. Just had to tell somebody. I’ve done this business 33 years in a specialty shop, selling fireplaces, barbecues, awnings, patio furniture and pool heaters. The offshore crap is killing us slowly.”
Saskatchewan: (Hearth, BBQ) “It’s a totally different marketplace out there this year, with the combination of the economy/oil prices/forest fires. There are still people out there with money to spend, but they are looking for a deal; you have to work a lot harder at making the sale.”
Stock Watch
| COMPANY – EXCHANGE | SYMBOL | 52 WEEK | Week Ending | % CHANGE | MARKET CAPITALIZATION | ||||
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| High | Low | 01-APR-16 | 029-APR-16 | 4 WEEK | 26 WEEK | 52 WEEK | ($000,000) | ||
| HNI Corporation (a) | HNI | 53.75 | 29.84 | 39.73 | 43.72 | 10.0% | 1.8% | -9.1% | $1.910.0 |
| Pool Corporation (b) | POOL | 94.60 | 64.50 | 88.39 | 87.41 | -1.1% | 7.2% | 32.7% | $3,670.0 |
| Rentech (b)(e) | RTK | 12.10 | 1.55 | 3.04 | 3.47 | 14.1% | -40.7% | 194.1% | $77.6 |
| Restoration Hardware Holdings (a) | RH | 106.49 | 35.03 | 43.77 | 43.27 | -1.1% | -58.0% | -50.5% | $1,680.0 |
| Wayfair, Inc. (a) | W | 56.84 | 27.36 | 43.96 | 37.75 | -14.1% | -10.6% | 25.7% | $3,040.0 |
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(a) = New York Stock Exchange |
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