2019 July Business Climate
July Sales
In early August, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, patio, and barbecue products, asking them to compare July 2019 sales to July 2018. The accompanying charts and selected comments are from the 206 usable returns.
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Weather Report |
Consumer Confidence |
Stock Watch |
MONTH-TO-MONTHRETAILER SALES – U.S. AND CANADA |
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In July, 55% of Spa retailers were DOWN, while only 18% were UP; compare that to July 2018 when 44% were UP, and only 11% were DOWN – the bottom fell out. |
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13 MONTH YEAR-OVER-YEAR RETAILER SALES |
In July, sales of both Hearth and Barbecue products were up 2%, while sales of Patio products were EVEN with the prior year, and sales of Spas were DOWN 7%.
Retailer Comments
Northeast
Connecticut: (Hearth, BBQ) “Thirty days until Showtime – let the games begin!”
Connecticut: (Hearth) “It seems our season has begun. Don’t understand why it’s starting this early unless world turmoil is scaring people about oil. In any event, we are up almost double from last July and YTD. Bring it on. Only problem is, we are having hard time finding decent and experienced staff to hire. We’re scrambling with current staff to keep up. Ought to be an interesting year.”
New Jersey: (Hearth, Patio, BBQ) “Looking forward to the fall and winter.”
New Jersey: (Hearth) “We have a lot of non-EPA wood and pellet stoves which are selling at 30% and up discounts. This has greatly helped with the increase from last year to this year.”
New York: (Hearth, Patio, BBQ, Spas) “Shame on the hot tub and swim spa blowout, dog and pony shows currently touring an arena near you. Shame on you. No service after the sale, no local support, you have created a black eye on the hot tub industry. You sell unserviceable junk tubs to unsuspecting homeowners, putting a long lasting bad taste in their mouths. It’s unscrupulous, and the rest of us small Mom-and-Pop businesses have to handle the fall out. Take a look at their websites. No phone numbers, no address, no direct contact information whatsoever. That is not cool, friends.”
New York: (Hearth, Patio, BBQ) “Sales of both wood and gas are awesome! We are selling off all wood non-2020 stoves and inserts from our showroom floor and replacing them with new 2020 products. Haven’t had to discount any wood units so far. Only a few left. Service is crazy as we are booked out 60 days now, and that is after we raised prices. Looks like a great year!”
Pennsylvania: (Hearth) “We are in a very good position to begin the fall season. Summer has been busier than the past five years. Looking forward to the fall and hopeful the upswing will continue.”
Pennsylvania: (Hearth) “We are closed for two weeks in July, so 146% is just a large percentage, not a large number! But the plus 22% for the calendar year is a real measure of what is really going on. A great year in the making.”
Pennsylvania: (Hearth, Patio, BBQ) “Maybe we should start selling sump pumps and pipe. The weather has been so uncooperative this season. Last year ended with the most rainfall ever, and this year we are already ahead of this point last year.
“Climate change is for real and it’s not getting any better. Overall sales are on track with last year, but down overall from two years ago. Pellet grills were all the rage last year, and the George Forman grill is now available everywhere and cheap. Have to go, time to fire up the sump pumps.”
Pennsylvania: (Patio, Spas) “The $799 patio sets we used to sell are gone. Now they’re $1,500 plus for a set. The Big Box stores sell for even less. Sure, we have quality, but it comes down to the dollars that a lot of people can afford.”
Pennsylvania: (Patio) “The second half of July was down a lot, perhaps due to the heat.”
Weather Report
For the following weather charts, the numbers for each state reflects the temperature and percipitation rankings for the period since records began in 1895.
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In July, temperatures were Much Above Average from North Carolina to Maine, and in Florida and New Mexico. |
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What a difference a year makes! Last year was the hottest May–July period in 124 years. This year there was Much Above Average temperatures from Florida to New Jersey, but the rest of the country was at Below Average, Near Average, or Above Average temperatures. |
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In July, precipitation in South Dakota was at a Much Above Average level, while Arizona was at a Much Below Average level. The rest of the country was at Below, Near, or Above Average levels. |
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South
Alabama: (Hearth, Patio, BBQ) “I opened my shop in 1978 (so I’ve been around awhile). I’m a pie watcher on my QuickBooks, and it seems there used to be somewhat predictable patterns, but not anymore. It’s all over the place. We might have a record good month bumper-to-bumper with a record bad month. Walk-ins are way down, but when a customer comes into my showroom, he’s not here to ‘kick the tires.’ He’s here to buy. Internet sales are and will continue to be a huge hindrance, but we will continue to do what we do. It’s time to retire but I ain’t ready – damn it!”
Arkansas: (BBQ, Spas) “Another typical slow July for retail sales in hearth. Too hot for folks to think about heating installs, but some encouragement in floor traffic – finally.”
Oklahoma: (Hearth) “Ready for winter.”
Virginia: (Hearth, BBQ) “Very slow month. Lots of customers on vacation, etc.”
Virginia: (Hearth, BBQ) ”Too hot.”
Midwest
Illinois: (Hearth) “We seem to be up a little, but not any earth shaker. Illinois keeps suffering from one new tax after another.”
Illinois: (Hearth, Patio, BBQ) “Finally catching up after a terrible spring!”
Illinois: (Patio) “After a slower June, July kicked back in. Woven and teak again led the way. Some clients are just now getting patios finished after such a wet spring.”
Michigan: (Patio, BBQ) “Wetter weather and cooler temperatures have impeded sales in outdoor living.”
Missouri: (Hearth, BBQ) “Sales of hearth products are steady. The spring business was soft due to excessive rain slowing down the new construction projects. Barbecue sales have been significantly down from 2018. Last year there was a steady flow of buyers. This barbecue season has been very slow with only a few people even looking at grills. The non-stop rain all spring could possibly be an explanation.”
Ohio: (Hearth, BBQ) “The only way I can describe this barbecue season is weird. It was very sporadic. Grills sales would trickle in and then we would sell a flood of high-end, stainless-steel grills. Then a trickle, then a flood again. Just weird. Thankfully hearth has not let up. Direct-vent gas sales are staying steady. We have high hopes for the approaching heating season.”
Wisconsin: (Hearth) “Sales are still steady, strong. Builder market is very strong. Our potential is limited to our ability to find additional competent help in a hyper competitive employment market.”
Wisconsin: (Patio) “Sales dropped off sharply toward the end of July.”
Wisconsin: (Hearth, BBQ) “July is down a bit this year, in part because there was major vandalism to our vehicles. We had to repair and adjust; we lost quite a few days of work. August has quite a bit of work lined up. We are training new promising employees. Our YTD sales are greater than last year. Thankful for the business!”
Wisconsin: (Hearth, Patio, BBQ) “Traffic was steady, but sales are down. Rain slowed some building, but guessing after last winter no one wants to be thinking about heating. No change in advertising. Go figure?”
Wisconsin: (Hearth, Patio, BBQ) “I can’t believe it could possibly have gotten better than last July. But here we go. These are historic times in our industry. Without a doubt, the more expensive the product is, the easier it is to sell. Customers are maintaining price with quality and want the best.”
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A reading above 90 indicates the economy is on solid footing; above 100 signals strong growth. |
West
California: (Hearth, BBQ, Spas) “Weather was so hot that it kept the customers away. We were dealing with employee vacations so our installations were off this month. We have doubled up for the month of August, so we should catch up pretty quickly. We are busy and scheduling into late September. Should be able to make up our July downturn. Adding two new employees this season, hopefully, fingers crossed!”
California: (Hearth) “The rebuilding process since the October 2017 firestorm has affected our bottom line tremendously. All fire survivors receive a 10% plus an additional 10% discount on all purchases. Our chance to give back!”
Colorado: (BBQ) “Traeger and Big Green Eggs are selling like hotcakes!”
Oregon: (Hearth) “July finished out a brutal summer for us. Things have picked up a lot of momentum and are starting to roll now!”
Oregon: (Hearth, BBQ) “Hearth products display is now reaching its first anniversary.”
Washington: (Hearth, Patio, BBQ, Spas) “We’ve doubled last July sales.”
Washington: (Hearth, BBQ, Spas) “Slow start to the first half of the year. It appears to be picking up.”
Canada
British Columbia: (Hearth, BBQ) “Wood stoves and high-efficiency wood fireplaces continue to sell steadily.”
British Columbia: (Hearth) “Lots of ‘tire-kicking’ but most are requesting a quote for late July or August.”
Ontario: (Hearth, Patio, BBQ) “Bad weather, too much rain.”
Ontario: (Hearth, Patio, BBQ) “Had the best July in years, but behold only up 15% YTD. Not enough to make up for this dismal decade – too many dealers, too many deals.”
Ontario: (Hearth, BBQ) “Flat month, but I’m happy as the constant rain in March through June didn’t hurt our sales.”
Ontario: (Hearth, Patio, BBQ) “Residential new construction is booming. Finally nice weather. Slow Big Green Egg sales and Lowes/Rona are selling Kamado Joe’s cheap.”
Ontario: (Hearth, BBQ) “The barbecue and pellet businesses are being bastardized by the manufacturers. Most everyone is selling a cheaper line to the Big Box stores in order to keep the factory going. That in turn is cheapening the brand name, e.g., Napoleon, Louisiana, and Weber, among others.
“Internet sales are also taking a big chunk. Then people complain online about poor products, service, etc. I even get people coming into our shop for parts for the units they bought at Big Box stores. This is why we are no longer giving up floor space for barbecues. We are also in the HVAC business; if not for that we would have closed our doors years ago.”
Stock Watch
| COMPANY – EXCHANGE | SYMBOL | 52 WEEK | Week Ending | % CHANGE | MARKET CAPITALIZATION | ||||||
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| High | Low | 28-Jun-19 | 26-Jul-19 | 4 WEEK | 26 WEEK | 52 WEEK | ($000,000) | ||||
| Standard & Poor’s 500 (a) | S & P | 3,025.86 | 2,351.10 | 2,941.76 | 3,025.86 | 2.9% | 11.8% | 7.3% | |||
| HNI Corporation (b) | HNI | 44.71 | 31.24 | 35.38 | 34.07 | -3.7% | -12.5% | -19.4% | $1,420.00 | ||
| Pool Corporation (c) | POOL | 196.00 | 136.83 | 191.00 | 192.52 | 0.8% | 27.8% | 25.0% | $7.450.00 | ||
| Restoration Hardware (b) | RH | 162.10 | 84.11 | 115.60 | 130.78 | 13.1% | -0.9% | -5.0% | $2,540.00 | ||
| Wayfair, Inc. (b) | W | 173.72 | 76.60 | 146.00 | 138.06 | -5.4% | 35.1% | 19.5% | $11,760.00 | ||
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