THE VOICE OF THE HEARTH, BARBECUE AND PATIO INDUSTRIES
DECEMBER 2019
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| CONTENTS | FEATURES The Nicest Guy! 12 The life and times of Perry Ranes, whose soft,
friendly manner has served him well managing Travis Industries’ sales force; he retires on December 31.
Good to Better 20 The new NSPS (Step 2) was, and remains,
a challenge for manufacturers and, to a lesser extent, retailers, but there’s light at the end of the tunnel (May 15, 2020).
60
Nothin’ but Hearth 28 There are still many specialty shops that sell only hearth products; one of them is Custom Fireside Shops in California.
What’s Cooking? 34 What was, what is, and what’s to come in the barbecue category.
Islands in the Southwest 40 BBQ Island is a three-store retail oasis of barbecue
and outdoor living products, backed up by a strong social media and educational element.
Cautious Optimists 46 If it isn’t the weather, it’s the tariffs,
46
or the competition.
The Cool Factor 54 Keep It Casual completely reinvented itself, and that has made all the difference.
Wealth Depends on Health 60 You take good care of your business, but are you taking good care of yourself?
54 4 | DECEMBER 2019 | www.hearthandhome.com
DEPARTMENTS
7
70
Perspective New Products
74 Business Climate 78
Stock Watch
80
Ad Index
82
Parting Shot
81
Who Reads Hearth & Home?
ON THE WEB News Print Books Remain Most Popular Which Occupations Are Dominated by Millennials?
40
Recipes Honey Glazed Smoked Ham by Pit Boss Grills Cranberry Pecan Bread Pudding by Pacific Living
THE VOICE OF THE HEARTH, BARBECUE AND PATIO INDUSTRIES
DECEMBER 2019
®
On the Cover
DECEMBER 2019
A fireplace, a warm room, and a beautiful view – perfect for the holidays!
www.hearthandhome.com COVER PHOTO: ©2019 ZACHARY GROSFIELD. WWW.ZAKARAPHOTOGRAPHY.COM.
www.hearthandhome.com | DECEMBER 2019 | 5
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Hearth & Home, The Outdoor Room and Vesta Awards are registered trademarks of Village West Publishing. Village West Publishing is not associated with, and has no financial interest in, the Hearth, Patio & Barbecue Association. Hearth & Home (USPS 575-210/ISSN 02735695), Vol. XLI, No. 1 is published monthly by Village West Publishing, 25 Country Club Road, Ste. 403, Gilford, NH 03249/P.O. Box 1288, Laconia, NH 03247. Subscription price $36 per year; $60 (USD) in Canada; $120 (USD) overseas (first class, airmail only). Single copy price $15 (includes postage and handling) in U.S. and in Canada. Periodicals postage paid at Laconia, NH and at additional entry office. POSTMASTER: Please send address changes to Village West Publishing, Circulation Department, P.O. Box 1288, Laconia, NH 03247.
| Perspective |
The Past & the Future
T
he main thrust of this issue – as it usually is at this time of year – is to provide you with a glimpse of how your peers view the passing year, as well as the coming year. Read the industry sections carefully and you should be able to sense consensus on some issues facing us in 2020. That should help you in running your business.
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Generally speaking, most people interviewed for these articles tell us that business in 2019 was at least level with the prior year, and for many, it was better. As far as the coming year, there seems to be more than a bit of trepidation. The three retailer profiles we have in this issue are particularly interesting, and illuminating. The first is Custom Fireside Shops, a two-store business based in
California that does nothing but hearth, no patio, no barbecue, no spas, just hearth – all 27 brands of hearth products. Mitch Heller is the president. In the Greater Phoenix area, Mike West has three terrific barbecue stores – one in Tempe (14,000 sq. ft.), one in Scottsdale (6,000 sq. ft.), and the third in Peoria (6,000 sq. ft.) – showing upwards of 42 different brands. In Tupelo, Mississippi, Meredith Tollison moved to a new location within walking distance of the old, and sales went through the roof. The new design was dramatically different, and very upscale – and that made all the difference. The number of brands carried there? Too many to count. Perry Ranes, vice president of sales for Travis Industries, is retiring at the end of December, with plans to travel the country with his wife Peggy, seeing all those interesting sites he passed in a blur as he traveled with his reps. He was just too busy back then. If you’re a rep, you can certainly relate to that. Now, if he only had read the article on “Wellness,” starting on page 60 in this issue, he would have taken the time to smell the roses! Or not. Knowing that the Travis Industries people like to have a little fun, we asked Perry to tell us a few stories. He opened up with Kurt Rumens paying Glen Yoder $100 to slap a cake into Perry’s face right before Perry had to give a speech. He gave the speech anyway, and it was a success. Boys just like to have fun, I guess. If you call that fun. (For more stories from Perry Ranes, read the article that begins on page 12.) Happy Holidays, everyone, from all of us at Village West Publishing!
Click here for a mobile friendly reading | experience www.hearthandhome.com DECEMBER 2019
| 7
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THE TRANSITION TO ELECTRIC FIREPLACES IS SURGING IN CALIFORNIA One hearth distributor’s focus on electrics is driving sales for their dealers.
C
alifornia is leading much of the country in policies addressing carbon emissions and their impact on the environment. For architects, builders and designers looking to comply with regulations placed on fireplaces, there’s a noemission option that has continued to blossom over the years— electric. Electric fireplaces continue to improve and thus the demand continues to increase. One California hearth distributor has adopted the category and has seen great results. We sat down with Gabe Cottle, Sales Manager, from West End Brick N’ Fire to learn why he swears by electric and why you should too. Q: Start by telling us a little bit about West End Brick N’ Fire and your role in the business?
8 | DECEMBER 2019 | www.napoleonfireplaces.com
Gabe: West End Brick N’ Fire has been around for 30+ years. Calling Ontario, California, home, we have earned a strong name for ourselves among hearth and patio dealers alike. My parents started this business out of their garage in 1988 as an installer. One year later, they opened their first warehouse and realized they could not serve two masters—installation and distribution—and became a dedicated distributor. Today, my brother Nick and I are continuing to learn the ropes to one day take over the family business when our parents retire. Our expertise in the category sets us apart, and we provide premium quality products with a high level of service and forward thinking that is highly valued by our dealers.
Q: One of the issues we see dominating the news as of late is climate change. What impact, if any, do you see that having on the hearth industry? Gabe: Well, unfortunately in California we have too many local governments that are having what I would call a knee-jerk reaction to implementing climate change legislation. Things are moving at a more rapid pace here. We are seeing bans on wood fireplaces and an increasing shift away from gas. The focus now towards electric utilities is just one piece of the puzzle. To survive, our industry will need to evolve the value and expertise it delivers to customers. What we are experiencing here in California will rapidly sweep across the entire country. Distributors and dealers need to embrace the change now, just as some manufacturers are.
and designers gain almost three feet of space that would otherwise be consumed by the fireplace. In my market in Southern California, I’d say about 90% of our dealers have electrics on the showroom floor, and sales are booming.
Q: What can other hearth dealers do to take advantage of the electric category?
L to R: Gabriel Cottle and Nick Bechtel
Q: Do you really see electric fireplaces now as a serious alternative to wood and gas units? Gabe: You know it’s funny, being a fireplace junkie, if you would have asked me that question even three years ago, I would have said no. That’s because it was a new segment and the units didn’t look realistic at all. But over the last couple of years the category has grown by leaps and bounds. So, today, yes, it is a viable option because the technology has gotten so much better. The flames are brighter, higher and more realistic. Consumer attitudes are changing too. We’re seeing more and more people willing to invest their money in a quality, realistic electric fireplace than ever before. Electric units also tend to be more cost-effective than gas or woodburning units. They are less expensive to install and take up much less space in the home or showroom floor. Builders
Gabe: Our successful dealers are offering a level of product quality, installation and service that cannot be matched by Big Box stores. Sometimes we start behind the 8-ball because they see something at Costco for $300. But once we educate the consumer, they quickly see the difference and the price objections fade. The quality of the product is crucial, and that’s why we partnered with Napoleon. They are ahead of the curve when it comes to both performance and appearance. Secondly, the quality of the installation is important. It should look just as finished as a gas project. Beautiful surrounds and mantels increase the appeal and profitability of the project. Thirdly, dealers should target multiple rooms in the home. Electrics can be installed anywhere, and today’s homeowners love fireplaces in multiple rooms. Finally, dealers should increase the amount of showroom space dedicated to electric fireplaces. Treat your showroom installs with the attention and quality you would provide to a customer. And of course, educate and reeducate staff on electric and its evolution over the years.
Napoleon is a leading North American manufacturer of wood-burning, gas and electric fireplaces, as well as outdoor living products. Napoleon aims to inspire and enhance the most memorable experiences people enjoy in their homes. To find out more about Napoleon, visit napoleonfireplaces.com.
www.napoleonfireplaces.com | DECEMBER 2019 | 9
The warmth of the season surrounds us... 2800 CRESTWOOD BLVD IRONDALE, AL 35210
WWW. PEAKSEASONINC.NET
1.8 6 6 .6 0 6 . 6 3 3 0
| Exit Interview |
THE
NICEST GUY! Richard Wright
The life and times of Perry Ranes, whose soft, friendly manner has served him well managing Travis Industries’ sales force; he retires on December 31.
12 | DECEMBER 2019 | www.hearthandhome.com
PHOTOS: ©2019 JIM LINNA
“A LITTLE
nonsense now and then,
is relished BY THE WISEST MEN.” – Roald Dahl, British novelist
W
hile Kurt Rumens is the president of Travis Industries, and certainly the creative force behind its success, Perry Ranes has been his righthand man, the person in charge of hiring and running the company’s sales force throughout North America. In short, he’s in charge of sales and bringing in the money.
Ranes: “It was a religious sect and they moved into Antelope, Oregon, and took over the entire town. They had about a 100,000-acre farm that they bought. They had tons of money, and Bhagwan had 11 or 12 Rolls Royces, but he couldn’t drive. They were in the headlines every day. We had a product called Quest, with polybutylene tubing. I got a call from Rajneesh and they were interested in our product because if you needed a 45-degree angle you just bend it, and crimp it. “I got all excited. I thought, ‘Boy, I’m going to go out there and make some money.’ I went to the farm and met with one of the purchasing agents; she somehow got her hands on the price book and beat me up pretty bad on the pricing.
Ranes: (Laughing). “Anyway, a good friend of mine was an independent rep; he carried a lot of different products, and one was Simpson DuraVent. He was selling venting, and he said, ‘How much longer are you going to be selling these toilets? I know a little company called Wood Energy Products in Portland; I know their rep is leaving, and they’re going to be looking for another rep.’ I asked, ‘What do they sell?’ He said, ‘Wood stoves.’ I said, ‘I don’t know that product.’ He said, ‘What’s there to know? The wood goes in and the smoke goes up.’ “I applied, got the job, and started working for Wood Energy Products, a distributor. The owner, her name was Nora Smith, a Lebanese woman, and I just fell in
Hearth & Home: Let’s start with what you were doing prior to meeting Kurt Rumens. You were in the plumbing field, I believe. Perry Ranes: “Yes, I was in it for about 12 years. I started off working in the warehouse, loading trucks. I did that for about a year or so. Then my boss moved me inside to an order desk where I worked for probably a year. One Sunday afternoon he called to tell me to wear Dockers and a nice shirt when I showed up the next day. One of our reps had suddenly decided to take another job and left right away. We were based in Portland, and supplied the mobile home industry in the Pacific Northwest with all its plumbing. “When I showed up they gave me a big briefcase with all of our books in it; one rep took me on my route and stayed with me for two weeks showing me what to do. After two weeks my boss gave me keys to the car and a company credit card and said, ‘Go get ’em, Tiger!’ It took me a while to get it figured out, but it worked; I did that for about 12 years. “Do you remember the Bhagwan Shree Rajneesh?” No.
L to R: Quinn Wilks, Regional Sales Manager; Perry Ranes, Vice President of Sales; John Beiermann, Regional Sales Manager; Christian Hale, Western Canada Sales Manager.
“At some point they tried to kill a federal judge, tried to poison him with salmonella. National Geographic even did an article on them. They had security forces with automatic weapons. The State of Oregon finally raided their compound. It was quite the deal. I used to go out there every three months or so and they would order a semi-load of the Quest tubing. I did that for 11 years.” It was a very smart move for you to back down on your pricing, given all the firepower around that compound.
love with Nora Smith. She treated me like family and she taught me so much about owning a business. Her philosophy always was, ‘Keep a close watch on the dimes and the dollars will take care of themselves.’ “We had Lopi as a product to distribute, and we had a number of other lines such as RSF Fireplaces. I started going through Oregon and northern California; as the company was growing we kept adding staff, so she put me in charge of all the salespeople. We had about seven or eight reps in the field, and we had two tractor-trailers; we were doing our own deliveries. Click here for a mobile friendly reading| experience www.hearthandhome.com DECEMBER 2019
| 13
| Exit Interview | “She was a wonderful person. Then she ended up with cancer. It broke my heart. They offered me a part of the business and I said, ‘No, I really don’t want to do that.’ “I had been with Kurt Rumens, attending a lot of meetings, spending time at the trade shows, and I really liked Kurt. One day at a trade show he said, ‘I’m looking for someone to come up and help, would you be interested?’ I said, ‘Yeah, maybe.’ We talked for a while and I finally said, ‘I would love the opportunity.’ A month later I went up to Seattle and started working with Kurt up there.”
a hard time and struggling, he always steps in and tries to help them. “Initially, I was very involved with the Wood Heating Alliance and also with the Oregon DEQ. In Oregon, they would have to burn all their fields to totally purify them because a big part of what Oregon exports is feeds, and you had to get all the impurities off the buds. The wind would blow across I-5 and the skies were loaded with smoke. I remember the Federal Government saying, if you don’t get this corrected we’re going to withhold your highway taxes, or money for building bridges and roads.
Kurt had told Glen he would give him $100 if he would push a cake into my face. As I’m pacing back and forth, I turned around and he hit my face with a cake. Oh, my God! My glasses were stuck. It was in my ears, on my clothes. “I ran to the bathroom and here comes Glen, just a big teddy bear, and he’s got my glasses and he’s saying, ‘I’m sorry, Perry.’ I said, ‘Get away from me and give me my glasses.’ I had to get up on the stage, and everyone was staring at me and grinning. I got a huge commitment from those in the audience. A lot of people signed a check and
Kurt Rumens standing in front of the 66-ft. DaVinci.
What year was that? Ranes: “I started at Travis Industries in May of 1992, but I had been working with Kurt for 11 years prior to that, and I really liked him. He is full of energy. He was just consumed by everything he was thinking about and trying to design. It was exciting, and that brought me along. He can visualize exactly what he wants to build. Somehow, he can see it and we mere mortals have a hard time keeping up with him. He can tell if something is off by even a little bit. “I’ve never known anybody like him, and Kurt has always treated me so well. He has a huge heart and is a very compassionate person. When he sees people who are down and out, or having
14 | DECEMBER 2019 | www.hearthandhome.com
“So Oregon folded right away and, of course, they came after wood stoves. I think you had to be under 15 gph of emissions. I remember going around to dealers and trying to get them involved, but everyone was too busy. I was telling them the price of wood stoves would now cost more money because they would now have to be redesigned. At the time we were saying that stoves were going to up to $600 and nobody was going to spend that kind of money on a stove. “Do you remember Glen Yoder? I’m getting ready to give a speech to a whole bunch of dealers, asking them all to contribute with $100 to join the Wood Heating Alliance. I’m pacing back and forth. I’ve got my cards and unbeknown to me they brought in a big dessert cart.
joined the association, so I guess it was worth it. Glen and I became very good friends.” That’s all part of what we, and many others, experienced (not the cake part). It was getting to meet an awful lot of very nice people from across the country. Everybody was involved in creating something new. Ranes: “Exactly. Now the industry has changed; it has evolved. But it was all of these Mom-and-Pop businesses that started with little or nothing, and learned on their way. I’ve always loved this industry. So many of the people that I deal with on a daily basis started with little or nothing; they had a dream and worked phenomenal hours. A lot of people had a second job to keep the money coming in.
“I love this industry. I love the people I work with, and the memories I have of some of these dealerships and watching them develop and grow and become very successful. They found a way to make it work.” You went up to Seattle in 1992. Were you still a rep or were you in charge of reps?
Ranes: “Yes. I would find people who worked for other dealerships. I always looked for that person, male or female, who was a real family person, where family was very important to them. Then, technically, are they hands-on? Could they go into a dealership and help them as a problem solver?
“I always felt that the product itself was very good. But I wanted my reps to go into the dealership and help them solve problems.”
— Perry Ranes
Ranes: “I came up and was given a territory; I had the middle part of the country. First, I had some unfortunate things to do. I had to get rid of some people and bring in other people, and start developing more of a baseline for reps who represented us. I did a lot of traveling with them, just making the business grow. “I think I did that for four or five years and, close to Christmas time, Kurt called me into his office and said, ‘OK. After January 1, I want you to be in charge of all the reps – of all sales. I want you to be my Sales manager.’ I said, ‘I don’t think I’m interested in that.’ He said, ‘Well, that’s why I hired you, so you better get interested.’ “I didn’t go kicking and screaming. I think part of it was that I had developed such a close relationship with my market, and those dealers. And he said, ‘Well, you will still be dealing with them, but you will be dealing with a lot of other people, too. But I need you to do this.’ That’s how that got started, and I just fumbled my way through it.” Which states were you in charge of initially? Ranes: “Texas, Colorado, all of the Midwest and then over to Florida, Georgia, the Southeast. It was a huge territory.” You were in charge of finding and running reps for that whole area?
“I always felt that the product itself was very good. But I wanted my reps to go into the dealership and help them solve problems. When my rep came in the door, I always wanted the dealer to say, ‘Oh, good, I’m glad you’re here,’ instead of, ‘Oh, great. It must be time to give you an order.’ Those were the two factors I always went with.” I think some people just aren’t technically competent. I remember one of your reps, Paul Birnstihl, really didn’t want to be technically proficient. He felt it was someone else’s job. Ranes: “Right. Yeah. Heart of gold, loved the industry, he did a lot of wonderful things. Kurt was trying to get ahold of Paul, and I said, ‘Well, I’ve got his cell number.’ Kurt ended up dialing his office, and a woman answered the phone. Kurt asked if she had Paul’s license plate number. She asked, ‘Why?’ He said, ‘I’m going to pull a little gag on him.’ “She gave him the license plate number, and he knew the BMW he was driving. He called Paul and said that he was a highway patrolman, and that, ‘We have an officer in the area. You’ve been clocked at 80 miles an hour, and the patrolman is coming up behind you and you need to pull over.’ Paul was saying, ‘I don’t think I was driving that fast.’ ‘Well, sir, we had you at it.’ Honest to God, he got Paul to pull over off the freeway and he was running out of stuff to tell him. ‘Is your blinker on?’ ‘It’s safe
to pull over.’ ‘Turn your engine off,’ and stuff like that. “When caller ID came on, I think it crushed Kurt because he did that to everyone.” Today, how many reps do you have in the U.S.? Ranes: “About 25 in both the U.S. and Canada. Now that’s also counting all the people who work at some of our distributors that are also out on the road.” As I understand it, Canada has been a very good move for you guys. Ranes: “It has been. We’ve got about 80 dealers in Canada. It really is working out. The difference in the dollar makes it difficult, obviously. The Canadian dealers have really embraced us; we give them the market room, give them room to run their ads and advertising and get a nice feedback from the market area they’re in. That has worked out really well for us.” When Kurt and Lopi ran into financial trouble, and Travis Garske was there when needed, were you already with him at that point? Ranes: “No, I was not. I was still in Portland. I think it was maybe just a year later that I came up to the Seattle area. Talk about the best in the world for running a business, Travis Garske is remarkable. He reinvests right back into this company. We don’t have to go to the bank for a dime. He has always done that, even in years when there has been a downturn. We try to hit the numbers that I think we need to have, and sometimes we miss those numbers. He’s always the first guy on the phone calling me and saying, ‘Don’t worry. We’ll get it next year, and we still made some money.’ ” What did he think of your 66-ft. gas fireplace? Ranes: “Oh, it just amazed him. He wasn’t thrilled at all about the DaVinci line. Neither was I. When Kurt was drawing out the DaVinci and explaining it to me, I said, ‘Really? It’s going to be 3-ft. sections that connect?’
www.hearthandhome.com | DECEMBER 2019 | 15
| Exit Interview | “Kurt was very excited about that idea. I said, ‘So how much is it going to cost?’ His answer was, ‘Well, I don’t know. I think it will probably be this much per 3-ft. section.’ I said, ‘You don’t get any heat out of it?’ He said, ‘No.’ I said, ‘We’ll never sell any of those.’ (Laughing). “That was my same response to the Bed & Breakfast. I was looking for a little insert that we really needed. So now I think Kurt runs the Perry test. If I don’t like it, he knows he has a winner on his hands.” (Laughing).
Are you finished testing for 2020?
About what percent are they going up?
Ranes: “Yes. All of our products are done. Everything in our lineup is 2020 approved. The dealers have been fantastic about stepping up and buying our existing product that are not 2020 approved, so we are going to start the new year with a really clean slate.”
The DaVinci has been a very profitable introduction for you guys, hasn’t it?
Ranes: “There are some that still have a lot of inventory and most of the inventory they are carrying is not necessarily ours. But still, they need to clean that out and they are. But there are a couple of dealers that I know of that are working really hard to get rid of the existing stuff.”
Ranes: “I don’t know if I can give you a percent because each model is a little different in the way we had to build it. But there were things we wanted to change and improve upon, so we saw it as an opportunity. We changed the doors, put on bigger viewing areas, different air controls, different fans, some now are coming with legs on as standard. “So it wasn’t just the price of the components, but by adding all these other things to it that was also part of the price increase. So it’s coming standard, but with a lot of stuff that you have to buy as an accessory or add on later. That also was part of the price increase.”
Ranes: “Oh, it has been wonderful. It has absolutely been wonderful. It has opened so many doors for us and allowed us to bring in even more product to the builder network. The dealers have really embraced it. Giving everybody training has been difficult, and now it’s mandatory. You’ve got to come here for training because you really need to understand it; once it clicks it’s very easy.”
Are any of your dealers in trouble with the old product?
Now, in your case, did the whole EPA procedure cause prices on your stoves to go up? Ranes: “Yes.”
So you’re not going to get much pushback from your dealers, is that correct? Ranes: “No. Actually, we haven’t at all. I think most dealers are just excited that we have a full line of product and they can continue to sell product and not worry about it.” Let me change course a bit here. When and how did you meet your lovely wife, Peggy? Ranes: “Well, at a strip club, of course.” That’s where you spend your free time anyway, isn’t it?
Perry and Peggy Ranes.
16 | DECEMBER 2019 | www.hearthandhome.com
Ranes: “Exactly. Actually, Peggy was born and raised in Michigan and a job opportunity brought her out to Vancouver. I met her at a comedy club. She was with some friends of mine, so we were introduced and had an opportunity to sit down and talk. I found out that she really liked to ski, which I did also, and I said, ‘Well, maybe we’ll get together and go skiing.’ She said, ‘Are you any good at it?’ So, of course, I bragged a bit, but I later came to realize that she could ski circles around me. “She wrote her phone number down and I had to leave, so I told her I would call, and we would go skiing together. Of course, I lost her number, but I kept going back to that club and didn’t run into her for quite a while. Then, there she was again, and looking at me like ‘Oh, what a jerk!’ But we did get together and I brought her out to my house. We were going to somebody else’s place for Thanksgiving, and I baked a pumpkin pie.
“Actually I’m a pretty good cook, and I had a small turkey that I cooked because I just like to have one in the refrigerator. I could almost hear her thinking, ‘Oh, OK. Here’s a guy that cooks.’ Both of us grew up around horses and had a passion for it, and our friend had a number of horses. I watched her out there riding through the corral and I thought, ‘Oh, boy. She is kind of a country girl and I like that.’ We started dating, went skiing, and like I said, she skied circles around me. That’s how we met.” Ballpark, because I know your memory isn’t what it should be, when did all this happen? Ranes: “Well, we’ve been married now for 34 years and we dated for two years, three years prior to that so 37 years ago. She had a great sense of humor, thank God, and she still does, so that kind of gets us through the day.” When did she start working at Travis? Ranes: “She worked there for 22 years, and she retired two years ago. So she started in 1996, and she worked for Kurt. Peggy is an incredibly detailed person. She helped Kurt organize functions for trade shows. She would get rooms and assign people to rooms. They would have to tell her what flight they were coming in on. She would keep all that organized, set the functions up, what was going to be for lunch, what was going to be for dinner, and contact different hotels, different venues, and she would put all that together and then she would keep her files. “When I met her she was working up in Vancouver. She was working for PacifiCorp and they had a contract. They were laying fiberoptic cable from New York to England, and then also from San Francisco to Japan, and she was heavily involved with that. “She was the executive secretary; she worked for the CEO of PacifiCorp. She would organize all the meetings and everyone had to be prepared. As I said, she is a very, very detailed person.” What areas of the country are your best in terms of sales? Is it the West, the South, the Midwest, or the Northeast? Ranes: “These territories are so close. The West has for years really out-produced
the rest of the country, but now the East is leading the way by a little bit. Other than that, they are just neck and neck. All my regions are just neck and neck, which is really nice. And here’s where I talk about my managers. Is this a good time to talk about them?” Sure. Ranes: “I don’t know what I would do without these four managers. They are so good. They are so passionate about what we’re doing, and they have developed such close relationships with their customers, but they have always had my back. They kind of rally around me. “As you know, I’m struggling with Parkinson’s, and I just don’t know what I would do without this group. I can’t say enough good things about them. They have been at it for a long time. Everybody has their strong area, but they are just really good and they believe in what we’re doing. They love the company. They just shine.”
“Then, Quinn Wilks started off with Traeger, and he knows pellet stoves insideout and upside-down. Quinn has been with us about 20 years. Again, he’s a real handson guy such as John Beiermann. There is not much he can’t fix or know how it works. Quinn has all of the middle U.S. from Texas to Minnesota. “Then there’s Melodie Kauf. Melodie has been here 31 or 32 years working with Kurt, and she has quite a mind. Let’s say I’m putting together a notice, we’re looking
So you divided the country into four pieces? Ranes: “One is Canada, and then the U.S. is divided into three territories. Each manager is responsible for the particular reps they work with and manage those dealers in those territories. I work with both the managers and the reps, but by and large they do the heavy lifting. The one thing I’ve learned to do is to clear the path for them, but other than that I just get out of their way and let them do their job. They are just that good.” Did a lot of the managers start off as a rep? Ranes: “JB (John Beiermann) worked for Rich’s, I think, for 14 or 15 years, and managed all their stores. He’s an incredible hands-on guy. He works very closely with his reps; he does a lot of training, and a lot of traveling. John’s territory includes Ontario and Quebec, New England, New York, and the Mid-Atlantic, plus Arizona and Southern California, as well as Australia. Ed. Note: Do you get the feeling that Perry was settling scores when he carved up John’s territory?
Melodie Kauf, Regional Sales Manager.
at some marketing things, she can see the flaws in a second. She can read something and pick up on it immediately. Everybody has their strong areas. Her territory includes Alaska, Washington, Oregon, Northern California, as well as Idaho and Montana. Christian Hale has been with us for 13 years. Like the other managers, his background was in retail, but most of it was troubleshooting and installations for a company that sold HVAC products as well as gas logs, in Arizona. He came up to work on our tech line, where dealers call in with problems on installations and our techs help them out.
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| Exit Interview | “Now he manages western Canada, from Manitoba to British Columbia. He also is in charge of putting our booths together for the IBS and HPBExpo. We also send him on installs that nobody else can figure out. He always figures it out. “Then, with Kurt again, the vision that he has is remarkable. We have a dynamic team. I’m going to really miss these people.
I neglected to ask how many dealers you have right now. You gave me Canada, 80, but how many in the states? Ranes: “850.” So you’ve got a nice bunch, close to 1,000 people selling your products. That’s a lot. My guess is that the majority have been with Travis for years.
to the dealers. I really do have a passion for this industry, and what I’m going to miss so much are the people I interact with daily.” After this year ends, you and Peggy will be traveling around the country, seeing sights you never had the time to see when you were helping to build Travis Industries.
The 2013 Dealer Meeting at the Travis factory in Mukilteo, Washington, with the Puget Sound in the background.
“Also, the reps we have chosen, every one of them is hands-on. I know I keep using that term, but I think it’s so important to go into a dealership and actually have answers and be able to fix whatever is wrong, or spot something wrong with one of our fires, and get in there and make it better.” Now, you’re still making tours around the country and calling on dealers on an annual basis, correct? Ranes: “We are, the managers are, absolutely. Every year they usually start in June and go to meetings, traveling, visiting with the customers. Ever since my Parkinson’s it has become more and more difficult for me, so I haven’t traveled for the last two years or so. I haven’t been able to. So these guys are out there carrying the flag.”
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Ranes: “Yeah. Again, I tip my hat to our reps and managers out there for being able to get this many dealers, working with those dealers, and still figuring out what the market area is so they are not stepping on each other.” Is there anything that you would like to talk about right now? I’ve got about three more questions left. Ranes: “I hate to see what’s happening in our industry right now, because we are under siege. It’s a fight trying to work with some of these people who know little or nothing about our industry; they just go on pure emotion and make what I think are bad decisions in different communities. “If I had any kind of regret it would be that I didn’t stay more involved with the HPBA. I wish that I had stayed with that, passing the knowledge I have now
Ranes: “Yes.” The nice thing is that, wherever you go, you will know someone with whom you have most likely talked, or seen at a party. That’s got to be important to you. You could stop every once in a while, and go in and say hi to somebody who is part of the Travis team. Ranes: “Absolutely. In fact, that’s one of the things I’m looking forward to. With many of our dealers, we’ve enjoyed watching each other’s kids grow up, and you get to know them very closely; it’s much more than a business relationship, it’s a friendship.” Dorothy Matthews, whom you know, retired a year ago from her retail shop. She had been a Vesta Awards judge for many years. She asked if she could continue doing so indefinitely because it’s a way to come up and see her friends. So
whenever you need a bit of old friendships, just head for the HPBExpo.
“They need to figure that out before they can sell the whole concept, and they are a long ways from doing that. I would hate to be on the Board right now in some of these communities where they are trying to sell that concept in California that it has to be 100% electric and at the same time you’ve been out of power for four days again. But it’s slowly coming and I do see that as a huge
fireplaces.’ I’m interested in what your view is on electric fireplaces.
As you know, not only is wood being banned, but now we’ve got gas being banned in Vancouver as well as on the West Coast; in some developments it’s forbidden to even lay a pipeline through a development. We’ve been dealing with people banning wood now for a long time, and wood is still around and kicking. But natural gas is a greenhouse gas, and we’re on the wrong side of history; that’s a real problem. Do you see that being the biggest problem we’re facing right now?
threat. All of a sudden, wood is looking more attractive to a lot of these people.”
To me, that is what we want to bring to the dealer network, something that is going to be more expensive. I think electric is going to be the next big thing.”
Ranes: “Oh, I think it’s huge. The different communities and the way they are going about it is being put in the Building Codes. If you’re watching what is going on in California – I’m not talking about the fires, which are horrible – the electric company has to shut everybody down to avoid more fires. They say that’s going to be the new normal, but at the same time, everything in the house is supposed to be electric.
Ranes: “It gets more excitement back in something new, something fresh that people will look at. It doesn’t mean they are going to necessarily buy it, but every one of those introductions just builds excitement. It gets people back in the stores. So, yes, I do see wood starting to grow again.”
Ranes: “Kurt has invited me and Peggy to go to the Builder’s Show (IBS) and to the Expo in New Orleans; we are definitely going to do it. It will be different not going in with a setup crew, but I can go in and just critique the job and see everybody.”
Absolutely. Frankly, I’m pleased to see companies such as Stûv and Spartherm coming in with beautiful wood products. In Canada, Spartherm has joined with Powrmatic for distribution of their product. Stûv has made a major commitment by building its own factory on the outskirts of Montreal.
I remember that Tom Pugh (a rep for ICC/ RSF) said, ‘The future is going to be electric
Ranes: “We’re thinking the same thing. We think that electric fireplaces is a direction we need to get into, and we are not interested at all in going to China to do so. Kurt has some ideas right now that would make it a Travis product. It would make it unique.
Listen, I want to thank you for spending all this time with me (2 hours, 25 minutes, 45 seconds). Ranes: “It’s an honor. I really appreciate you doing this. Like I said, it must be an awfully slow news day. One thing I would ask is if you could mention how much I rely on my managers and my reps, and how fortunate I am to have them. I can’t say enough good things about them; they make my job so easy. They just have my back all the time, and it is really appreciated.” At Perry’s request (again), here are the names of his managers: Melodie Kauf, Quinn Wilks, John Beiermann, Christian Hale.
www.hearthandhome.com | DECEMBER 2019 | 19
| Hearth Sales: Past & Future |
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INTERVIEWEES Nick Bauer – Empire Comfort Systems Marc-Antoine Cantin – Stove Builder International John Crouch – HPBA John Czerwonka – Napoleon Fireplaces Bob Dischner – RH Peterson John Klopstad – Kozy Heat Fireplaces Dave Kuhfahl – Hearthstone Alan Murphy – Blaze King Kirk Newby – Associated Energy Systems Perry Ranes – Travis Industries Glen Spinelli – Regency Fireplaces Bret Watson – Jøtul North America
20 | DECEMBER 2019 | www.hearthandhome.com
R E T T E B O T
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By Bill Sendelback
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espite the confusion and uncertainty of the upcoming May 15, 2020, deadline for manufacturers and dealers to sell non-2020-certified wood-burners, 2019 was a pretty good year for hearth product sales. Manufacturers didn’t report record-breaking sales, but most saw at least single-digit sales increases. With the NSPS Step 2 deadline five and a half months away, manufacturers are looking forward to stronger hearth product sales even if those sales increases are moderate. As might be expected, wood-burner sales were not great in 2019, but most manufacturers were surprised they were not down more as dealers held off purchasing 2020 models until they flushed out their pre-2020 inventory. Gas hearth products continued to gain market share, especially higher-end models. Pellet burner sales, also affected by the 2020 deadline, were reported to be down – when
ILLUSTRATION: ©2019 A.E. BROWN.
manufacturers even bothered to report pellet stove sales. Electric fireplace sales again are up and trending; they continue to grow quickly. Weather is always a major factor for sales of hearth products. The Old Farmer’s Almanac may not always offer the most
25% of U.S. homes now only use electricity, particularly in the Midwest and South. accurate long-term weather forecasts, but it seems to be one of the few sources willing to risk a guess at coming 2020 weather trends. This winter (2019-2020) the Almanac is forecasting below-normal temperatures in the Heartland to the Pacific Northwest and Southwest, with above-normal temperatures elsewhere. Spring 2020 is predicted to be warmer than normal in the eastern twothirds of the U.S., near-normal in the Pacific Northwest, and cooler elsewhere. Summer 2020 temperatures are forecast to be below normal from Florida north through the Southeast, and from Texas and Oklahoma west to California. Fall 2020 temperatures are forecast to be cooler than normal in Texas, Oklahoma, New Mexico, and the Pacific Northwest, with near normal temperatures elsewhere. A la “Although nM urphy minimal solar activity has historically meant cooler average temperatures across the Earth,” the Almanac says, “we believe that recent warming trends will dominate in the eastern and northern parts of the nation this winter (2019-2020), with below normal temperatures limited to the Southwest.” Of course, heating-fuel prices also affect hearth product sales. The “Annual Energy Outlook” from the U.S. Energy
Information Administration (EIA) forecasts that natural-gas prices for residential use will increase 2.7% in 2020, propane prices will rise 6.5%, fuel-oil prices will jump 2.3%, and electricity prices will remain even with 2019 prices. While there is a lot of discussion in some regions about the use of natural gas, the EIA reports that natural-gas consumption in the residential sector has risen 13% since 2017. The EIA says that increasing energy efficiencies “across the end-user sectors” will keep U.S. energy consumption “relatively stable.” A growing number of U.S. homes are now all electric, says the EIA, reporting that 25% of U.S. homes now only use electricity, particularly in the Midwest and South. Eighteen percent of single-family homes are now all electric, with the EIA reporting that new homes are “more likely to be all electric.” Housing starts, too, are all important to the hearth product industry. According to the National Association of Home Builders (NAHB), total housing starts will rise 3.4% in 2020 to 1,286,000. Singlefamily starts will drop 1.8% to 902,000, while multifamily starts will increase 2.6% to 384,000. With some manufacturers concerned about the U.S. economy in 2020, the U.S. gross domestic product (GDP) is expected to be up 1.8% in 2020, down from 2.5% in 2019, according to The
The tariffs on Chinese imports are another factor affecting hearth products in 2020. In October, 2019, the U.S. suspended an additional 10% tariff on $250 billion in Chinese imports after China agreed to purchase $40 billion to $50 billion in U.S. farm products. Still a tentative agreement with nothing signed, the U.S., as of this writing, has not dropped its proposed December 15, 2019, tariffs on $160 billion in Chinese imports. “The partial nature of the deal won’t relieve much of the uncertainty surrounding trade policy that has discouraged many American companies from investing in new equipment and expanding,” according to Gregory Daco, economist with Oxford Economics as reported in the October, 2019, edition of The Economist. Blaze King After 2018, which was one of the best-ever sales years for Blaze King, 2019 has been a “very interesting year,” according to Alan Murphy, president. “We were up 10% early in the year but gave it all away during a slow summer. However, by this fall we were back to 2018 sales levels and hoping the fourth quarter will put us ahead.” Company sales for the year were OK in the U.S., and even though early-buy orders in Canada were up, Canadian sales ended 2019 “off significantly,” particularly on the West Coast. “We did not see brisk sales in the U.S. into the summer because there were
“Sales in the U.S. should be quiet in January and February and pick up after May 15, and Canadian sales should go back to historical norms.” Kiplinger Letter. Inflation will begin 2020 at 2.0%, compared to 1.9% at the end of 2018. Unemployment will be at 3.6% going into 2020. Regarding interest rates, 10-year treasury notes are forecast to remain in the “low 2% range until the trade wars end.” The NAHB expects fixed-rate, home-mortgage rates to go up to 4.49% in 2020, while the prime rate drops to 4.88%.
a lot of non-2020-certified wood-burners still in dealers’ inventories going into the season. “Dealers have been cautious about purchases,” says Murphy. “Ninety-nine percent of our dealers are now in great shape with their inventories, but they are still being very cautious. However, our dealers are in good shape for 2020 and looking forward to getting back to business. So we’re going to build product like crazy.” Click here for a mobile friendly reading |experience www.hearthandhome.com DECEMBER 2019
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| Hearth Sales: Past & Future |
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Empire Comfort Systems This year, 2019, was a “pretty normal” hearth product sales year for Empire Comfort Systems, according to Nick Bauer, president. “Our preseason orders were up, and sales have been steady. Higher-end product sales have been doing very well. Sales of our gas fireplace inserts have been doing pretty well, but they always seem to sell when we have bad weather.” Bauer is “cautiously optimistic” about his 2020 sales. “We expect slower sales in the summer and fall with concerns about tariffs, the economy, and the uncertainty
“With dealers still cautious about purchases, we expect our early-buy orders will be down. But sales of our gas models, especially contemporary models, will continue to grow.” in that we’ve been gaining new dealers because all of our line is 2020-certified.” Blaze King, whose sales are 98% woodburners, refined its product line but “did not have to change much” with its line of catalytic models, a technology it has offered for 40 years. Its King model is 2020-certified at 1.1 gph and 81% efficient, and its Princess model is certified at 0.4 gph and 80% efficient.
consumers will feel the effect. We’ve already had to take our prices up on our grills 10% to 15%, and these new tariffs may take that to a total of 25%. The grill market won’t take a 25% price increase.”
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Yes, prices will increase for 2020, Murphy says. “Because of the Chinese tariffs, we’ve had price increases from all of our suppliers, and labor rates are steadily rising. We anticipated much of these factors, so we slowly increased our prices over the past few years.”
Hearthstone Sales were slow in the summer of 2019 for Hearthstone as “dealers finally got the message” about the 2020 deadline and began selling off non-2020 models before bringing in new 2020-certified models, says Dave Kuhfahl, president. In 2018, Hearthstone saw its average unit dollar sale drop, but now larger wood stoves are selling, and the company’s average sales dollars are up. “In fact, we’ve sold out of large wood stoves this year.” Kuhfahl expects a “good” sales year in 2020. “We expect fewer total 2020-certified models on the market from the industry than were available with Step 1 models, and we’re well positioned, with our whole line Step 2-certified. Our dealers will be out of the non-2020 early in the year, so we expect good early-buy orders. Having our whole line 2020-compliant has brought us a lot of new dealers. But with the recent tariffs and the technology required to meet the 2020 Step 2 standards, wood-burning products next year will be more costly.” Kuhfahl thinks continued use of natural gas in new construction is “in trouble. This will definitely have an impact on our industry,” he says. But he admits that it will have minimal effect on Hearthstone since most of the company’s current sales are from wood-burners. “Nevertheless, we’ve been neglecting our gas offerings. We need to get back to expanding our gas products.”
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Murphy sees his current positive sales trend continuing into 2020. “The Step 1 wood-burners should have been discounted and cleared out by early February,” he says. “Sales in the U.S. should be quiet in January and February and pick up after May 15, and Canadian sales should go back to historical norms. Unfortunately, I will be very surprised if the EPA reconsiders and offers dealers a delayed sell-off period.” Trends in woodburning will be more of the same for 2020, and gas burners will become more furniture than heaters, Murphy predicts. “There has been a general lack of innovation in our industry because of the pressures to develop 2020 wood-burning products, but now it’s back to R&D. Unfortunately, we may see the 2020 deadline reducing the number of wood-burner manufacturers because N ic k Bau of the high costs to develop er these 2020 models. “An example is that the current EPA list of manufacturers offering 2020-certified wood-burners is much fewer than half of those offering former Step 1 models listed. We’ve been fortunate
of the U.S. elections. With all the rhetoric surrounding the election, we just may talk ourselves into a recession.” Bauer admits he is concerned about the recent local and regional efforts to eliminate use of natural gas from new construction. But he is more concerned about the tariffs on Chinese imports scheduled to take effect Dec. 15, 2019. “These will affect everything, and
Jøtul North America “All manufacturers of wood-burners felt pressure this year from the lack of an extended sell-through period for dealers with non-2020 models,” according to Bret Watson, president of Jøtul North America. “Our early-buy orders were down 35% as dealers did a good job of clearing out their non-2020 inventory by placing fewer early-buy orders for 2020
Klopstad thinks 2020 will chin with new-home see a “little decrease” in sales construction down, of wood-burners. “Although but now showroom we’ve been able to hold our traffic is up and prices, consumers will see sales are picking up. price increases because Our U.S. sales have of the high costs of 2020 been up slightly and certification. Because of are now picking up Jo the costs of that certification, because of our new hn C ze consumers will have fewer products and improved r wonka wood-burner options in 2020.” new-home construction.” The biggest trend going into 2020, Czerwonka sees a better according to Klopstad, is that we now have 2020 hearth product sales year. He a more educated consumer who wants expects Canadian sales for Napoleon to be up by single digits as Canada’s economy improves. “We’re more bullish on next year’s U.S. sales,” he says, “expecting a double-digit increase because of increasing “Although we’ve been new-housing starts and improvement in able to hold our prices, remodeling activity. We expect a lot of our consumers will see growth will come from our new products.” With pellet stove sales down and woodprice increases because burner sales on the decline, according to of the high costs of Czerwonka, sales of gas products are Jo “up slightly. Homebuilders have not 2020 certification.” hn K lo done a good job of meeting the needs p st a d of homebuyers when it comes to hearth products. But they are getting smarter, But Watson is concerned about other more features in fireplaces, such as being now preferring direct-vent gas fireplaces wood-burner manufacturers. “Because able to move heat to other rooms. “They rather than cheap wood Builder Boxes. of this 2020-deadline, we may see want clean-faced fireplaces that offer more They are learning that they need to include consolidation or worse of some woodstylish decor,” he says. hearth products that are commensurate burner manufacturers,” he says. Kozy Heat, too, is concerned about with the value of the home.” Watson expects Jøtul’s 2020 unit sales recent efforts to ban natural gas. “We need Outdoor living is growing “well to be flat, especially for wood-burners, to watch this closely and be proactive,” beyond a trend and is here to stay,” says but he expects increased dollar sales as Klopstad adds. Czerwonka. He says that sales of electric larger and more expensive models will be sold. “With dealers still cautious about purchases, we expect our early-buy “We’re selling more orders will be down. But sales of our gas models, especially contemporary models, expensive, vented log sets will continue to grow. This is the fastest with more features, such growing portion of our business.”
Napoleon Fireplaces “For the first eight months of this year our hearth product sales were OK but not record setting,” according to John Czerwonka, vice president of Hearth Sales for Napoleon Fireplaces. “Canadian sales took it on the
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Kozy Heat Fireplaces Sales for 2019 have gone “well” for Kozy Heat Fireplaces, they’re “on pace for another record year,” according to John Klopstad, general manager. “With homebuilding a little softer this year, we saw a softening in sales of direct-vent gas fireplaces,” he says, “but fireplace insert sales were up. Dealers have been scared to bring in new 2020-certified wood-burners, so we’ll see in the next two months just where sales of wood-burners will head.”
as electronic ignition. These larger, higher-end log sets are designed to put out more heat.”
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models. Our total unit sales of woodburners were off slightly, but our total dollar sales were up as consumers bought higher-priced models.” Growing sales of gas models helped Jøtul offset its decline in sales of woodburners. “In 2018, we were 50/50 wood and gas,” Watson says, “but this year 65% of our sales have been gas models.” Jøtul has not felt pressure to flush out non-2020 inventory. “With our ‘just in time’ production, we have not had to dump old merchandise. We can produce what we need on a very timely basis.”
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fireplaces are up “significantly. Electric fireplace sales will continue to grow. Dealers now recognize that they are not going away. We’ve invested heavily in electric models, now with more than 50, and our electric fireplace sales this year
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| Hearth Sales: Past & Future |
“The demand was early this year in Canada as homeowners there seemed to have researched and saw what was coming with the 2020 wood-burners, and bought Step 1 models.”
24 | DECEMBER 2019 | www.hearthandhome.com
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SBI has always had more success with its bigger wood-burners, and that trend continues. So for 2020, SBI is introducing more large models. “Maybe consumers see more value in larger sizes for a few dollars more.” The company also is working on a wood-burning furnace but is holding off pending final NSPS standards for wood furnaces. Product pricing is not a concern for Cantin. “Since we now only make wood-burners, nothing we use is made in China, so tariffs do not affect us. We see some cost increases from the technology we have developed to meet the 2020 standards, but these costs have not been as bad as expected, so we have not increased our prices.” Cantin points out continued difficulty in finding and hiring qualified workers such as welders. “If we have a real sales spike and need to ramp up production, this will make it almost impossible to hire people to meet that demand. For the first time, we’ve had to go offshore to hire workers,” he says. rr y
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RH Peterson With strong orders from 2018 carrying over to 2019, RH Peterson (RHP) has had a “very strong 2019 with a strong sales ar season,” says Bob Dischner, senior cAn vice president of Marketing. “We’re toine Cantin selling more expensive, vented log sets with more features, such as electronic ignition. These larger, higher-end log sets are designed to put out more heat.” the upcoming U.S. election, who knows There has been a “birch frenzy” in what will happen. No matter who wins, gas logs, says Dischner as RHP has seen however, the hearth industry will continue sales of these models increase. “During the to be robust because consumers want and season, consumers burn with the logs that need our products.” came with their set. But in the off-season, Spinelli, a member of the HPBA many are replacing these burned logs with board of directors, is concerned about white birch sets.” recent efforts to ban burning natural Although Dischner describes RHP as a gas. “But I’m happy that the HPBA and “Johnny come lately” with its gas fireplace its government affairs staff have ramped inserts, sales of these models, with their up robust actions to overcome these look of log sets, are steadily growing, he challenges.” says. Sales of RHP’s outdoor fire features are showing “steady growth. We’ve been Stove Builder adding new features such as LED lighting,” International (SBI) he says. Dischner expects 2020 will be “This year has been good and another strong sales year for RHP. will be a record sales year if our sales keep up this pace,” Regency Fireplaces according to Marc-Antoine Regency Fireplaces is having a “phenomenal” Cantin, president of Stove 2019 with sales growing in all fuel categories, Builder International (SBI). according to Glen Spinelli, president. “The “The demand was early this season started early and came on stronger year in Canada as homeowners in the fourth quarter. Dealers are there seemed to have researched buying what very few nonand saw what was coming with 2020 wood-burners we the 2020 wood-burners, and still have and also are bought Step 1 models. Sales now buying our new in the U.S. are starting to 2020 models.” Spinelli move, but have not been says Regency now is as robust, as U.S. dealers offering more EPAhad to get rid of their noncertified wood-burners 2020 models.” than ever. “Our sales of SBI is ready for 2020 G le wood-burners are stable, with its wood-burners and n Sp ine lli and we’re selling more and expects sales to be “robust,” more gas models.” especially in the U.S. “U.S. sales Regency is “conservatively during an election year usually are not optimistic” about 2020, says Spinelli. as good, but dealers will have cleared “Depending on the weather in January out their old non-2020 models early and and February, that will determine the sales will be ready to buy. So we’re optimistic momentum for 2020. The drama with about our Canadian sales in 2020 and very 2020 wood-burners will be over, but with optimistic about our U.S. sales.”
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are up by double-digits. Dealers should embrace higher-end electric models to truly be full-service dealers.”
Travis Industries Travis Industries’ 2019 sales were up 6% going into the winter, with signs of that percentage increasing in the fourth quarter. “Much of our growth has come from new products, and we have just released so many more new products,” says Perry Ranes, vice president of Sales. (Ranes will be retiring from Travis as of Jan. 1, 2020.)
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| Hearth Sales: Past & Future |
stock, dealers won’t buy until their non-2020 inventory is gone. But it’s interesting that our venting sales are very strong, indicating that there are a lot of wood stoves being sold.”
Ki
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“Even though we have 2020 wood-burners in
“We hope 2020 sales will hit at least 2019 levels, but we’re a little concerned about what may happen to the U.S. economy next year. If the economy holds up, we’re looking for a good sales year.” Ranes was concerned about the amount of non-2020 compliant wood stoves in his dealers’ inventories. “But with our line now 2020-compliant, we’re selling a lot of wood stoves. A large portion of our dealers have sold off their non-2020 models.” Associated Energy Systems Associated Energy Systems (AES), a large, two-step distributor selling hearth products and outdoor living products throughout the U.S. West Coast, Rocky Mountains, and South Central region, had an “awesome” first half of 2019, and, after a summer slowdown, is seeing a strong fourth quarter, according to Kirk Newby, president. “Most of our dealers are on track to have a strong 2019 sales year,” he says. This year Newby has seen the high-end market growing as customers want more full-featured products. “This is helped by a strong stock market, higher wages, and increased home values,” he says. “We’ve not seen personal incomes rise like they are now.” Newby sees 2020 as a “pretty decent” sales year with much of AES’ sales increases to come from new products. “The headwinds that may affect 2020 are the U.S. elections and whether the U.S. economy and stock market continue to grow,” adds Newby. “Even though we have 2020 wood-burners in stock, dealers won’t buy until their non-2020 inventory is gone. But it’s interesting that our venting sales are very strong, indicating that there are a lot of wood stoves being sold.” Newby expects sales of wood-burners to dealers will recover after the May 15, 2020, NSPS deadline.
26 | DECEMBER 2019 | www.hearthandhome.com
All eyes in the hearth product industry have been on the May 15, 2020, deadline to develop wood-burners to the Step 2 NSPS standards and to sell off all non2020 certified models. While, thankfully, this is coming to a head, John Crouch,
when coal and natural gas are used to create electricity
70%
of the energy value disappears before (the) electricity powers the house. Meanwhile, with propane and natural gas, nearly
90% of the fuel gets to the house.
director of Public Affairs for the HPBA, says the biggest news and biggest battle of 2020 will be to save natural gas in newhome construction. “A year ago, nobody predicted just how much discussion would be going on regarding natural gas,” he says. “These discussions may accelerate. Fortunately for now, these are more discussions than adoptions.” If adopted, natural gas would no longer be allowed in new-home construction, forcing more expensive, all electric homes.
The discussions revolve around “concerns” about greenhouse gas emissions in burning natural gas. Discussions and some regulatory proposals to ban natural gas in new construction have occurred in Northern California, Vancouver, Seattle, and Massachusetts. The HPBA is in a coalition of other trade associations, such as the American Gas Association, to respond to these challenges of using natural gas that could affect everything from hearth products to gas cooking. “A big concern is the consumers’ perception of the word ‘ban’ in news headlines, much like with wood stoves years ago. So we are responding very quickly,” Crouch says. Questioning the reasoning of eliminating natural gas and propane in favor of electricity, Jeff Petrash, vice president and general counsel for the National Propane Gas Association, said in the October issue of the Butane-Propane News, “The promotion of electricity as a fuel with zero carbon emissions is very misleading. We are decades and decades away from electricity being renewable, and coal and natural gas are used predominantly to create electricity.” He says that when coal and natural gas are used to create electricity, efficiency is much lower than heating with propane or natural gas directly. “A full 70% of the energy value disappears before the electricity powers the house,” he says. “Meanwhile, with propane and natural gas, nearly 90% of the fuel gets to the house. In these situations, an electric water heater will leave more than double the carbon footprint (of a propane or natural gas water heater).” By most accounts, 2020 should be a strong year for hearth product sales. Everything points that way. But there is an old adage that says, Sales forecasts are only good until the ink dries.
Maybe if you wish REALLY HARD “Santa” will leave a Blaze Grill under your Christmas Tree www.blazegrills.com
| Retailing |
NOTHIN’ BUT
HEARTH There are still many specialty shops that sell only hearth products; one of them is Custom Fireside Shops in California. By Bill Sendelback
H
earth product retailers normally offer much more than just hearth products. Most have taken on grills, or outdoor furniture, or spas and hot tubs, or a dozen other products rather than just selling hearth. But Custom Fireside Shops has been successful for 51 years specializing only in hearth products.
28 | DECEMBER 2019 | www.hearthandhome.com
With two stores in Sacramento and Elk Grove, California, Custom Fireside offers wood- and gas-burning stoves, fireplace inserts, fireplaces, pellet stoves and inserts, electric fireplaces, gas logs, glass doors, fireplace accessories, and fire pits. “We tried our hand at selling quality gas grills, but we found it was hard to compete with Box stores like The Home
Depot,” says Mitch Heller, president and co-owner. “What we are really good at are hearth products, so it made sense for us to make that our focus. That decision has proved to be the right one.” Today 70% of Custom Fireside’s sales are gas hearth products, with woodburners totaling 10%, and electric models at 10% percent and growing. Custom Fireside was created in 1968 by then-owner Weldon Ward in the company’s current Sacramento location. It was a different time for the hearth products With approximately 28 hearth brands on display, there’s much to look at, and buy, at Custom Fireside.
PHOTOS: ©2019 DAVE ADAMS PHOTOGRAPHY. WWW.DAVEADAMSPHOTOGRAPHY.COM.
Honeywell Corporation; he sold heating and air conditioning services as well as building control systems. “When Custom Fireside became available, I had been looking for a company to purchase, but did not want just any old company. There was a very limited selection of available companies that were interesting, and from which you could make a good return on your investment,” says Mitch. “I had been building fires in our old wood stove since I was eight years old, and I had worked off and on with my father in construction. So I enjoyed and understood hearth products, and could really see myself selling them.” Mitch Heller has since earned a master’s degree in business administration. Allan, now mostly retired, comes into the store about once a month.
business, so the company successfully specialized in glass doors, toolsets, and other fireplace accessories; that was back in the day when dressing up wood-burning fireplaces was the way to go. Having decided to retire, in 1994 Weldon sold Custom Fireside to his son, Brad Ward. Then Brad, who had been in hearth product retailing his entire life, wanted to move his life in a different direction. In 2004, Mitch Heller and his father Allan Heller purchased the Custom Fireside store. (Brad Ward did change his life, and rather dramatically; after selling the store he went back to college and became a high school teacher.) Allan Heller was a general contractor, and son Mitch was a salesman with the
“I had been in sales a long time,” Mitch says, “and I knew that I just needed to know a little bit more about my products than my customers did. So I started selling right away, but it did take some time to learn about the many different hearth products that we offered. We inherited great employees, some with 10 to 30 years of hearth product experience. Early on, Dad and I supplied the business acumen, and our employees supplied the industry and product knowledge. “We’ve been successful because we are always investing in our business, and we insist on offering the newest and best products in the industry,” Heller explains. “We don’t do high-pressure selling. We learn what the customer wants and needs, and then provide the products and services to meet those needs.
Allan (at left) and Mitch Heller.
Click here for a mobile friendly reading| experience www.hearthandhome.com DECEMBER 2019
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| Retailing |
At left, a variety of media on display, including logs and colorful stones as mass media.
“We are in it for the long term, so our goal is not just to make a one-time sale, but to make each customer so happy and satisfied that we may end up selling them more products down the road; we may even sell to their neighbors and friends. That strategy has worked for us.”
— Mitch Heller
At left, an upscale, traditional mantel and surround; at right, a peninsula fireplace in a contemporary setting.
30 | DECEMBER 2019 | www.hearthandhome.com
“We are in it for the long term, so our goal is not just to make a one-time sale, but to make each customer so happy and satisfied that we may end up selling them more products down the road; we may even sell to their neighbors and friends. That strategy has worked for us.” The economy in Heller’s markets is “holding steady,” he says. “Sacramento is the state capital, so a lot of our customers work for the state. But now, with the San Francisco Bay area being so crazyexpensive, we’re getting an influx of people selling their homes there and retiring in the Sacramento area.”
Sixty percent of Heller’s business is retail customers, with 40% being contractor sales; that includes custom homes and remodeling. “Remodeling really saved our bacon during the last recession,” he says. “Even though homebuilding was down, remodeling activity grew.” Heller is very involved with the National Association of Remodelers, serving on various committees and boards, and now being president of the local chapter. “The relationships we’ve built with remodelers have been key to our business in newhome construction.”
Any of Heller’s sales staff can work with any homebuilder in the showroom, and he has specific employees who visit the job site before, during, and after the job. “This way our contractors see the same familiar people in the field,” he says. Heller has an installation team dedicated to his contractor business; he subs-out retail installations. “Our retail business naturally scales up and down based on the demand at the time of year or season. When it’s cooler in the winter, we sell a lot of retail products, but not so much when it’s warmer. Subcontracting our retail installations has allowed us to scale our retail installations to the business we’re getting.” Heller’s subcontractors have been doing business with Custom Fireside “for many years. We have a relationship with them,” he says. “We pre-site the work, they install it, and then we do any needed service work. It works seamlessly.” Heller has 14 employees, and each has contributed to the success of the company. The average length of employee service with Custom Fireside is 10 years. “We support our employees with things like full health insurance coverage. We want them to have a good life and share in our success.”
Displays of stoves, inserts, grates and other accessory items.
Ron Franklin is Heller’s general manager, with “decades” of experience in installations. Glenn Strom is lead salesperson, and Rick Barton, lead presite person; they were both with Custom Fireside when the Hellers purchased it. Andrew Vaillencourt has managed the Elk Grove store for 15 years.
Heller does have some strong competition in his markets other than Big Box stores. “We compete with them by offering the best products and the best service,” he says. “We treat people as we want to be treated. We do an excellent job of solving customers’ problems, helping them with their needs, and making
The Hellers know how to use every inch of space in their stores.
www.hearthandhome.com | DECEMBER 2019 | 31
| Retailing | them feel comfortable in a low-pressure environment.” Another way Heller competes in his markets is by “having the best showrooms.” He recently completely remodeled his 4,000 sq. ft. showroom in Sacramento. “This time we hired a designer because we’re experts in hearth products but not in showroom design. It was very beneficial to have an expert pick out details such as wall finishes and designs to showcase various styles so the customer can be inspired and visualize how a product is going to look in their home.” The Elk Grove 3,000 sq. ft. showroom was
remodeled eight years ago after Brad Ward began at that location in 2000. With his large showrooms, Heller is not shy about displaying products. “We have more than 100 products on display at each location,” he says, “including gas, wood, pellet, and electric models, and fireplace accessories. We have dozens of burning models. We display a very broad range of hearth products including super high-end designer and commercial products, so we can show just about any style and any price point to get the customer exactly what he or she wants and needs.”
Store Name: Custom Fireside Shops
% of Gross Sales by Product Category: Hearth: 100%
Locations: 5545 Auburn Blvd. Sacramento, CA 95841 9097 Elk Grove Blvd., Elk Grove, CA 95624 Owners: Allan, and Mitch Heller Year Established: 1968 Website: www.customfireside.com
Email: mitchell@customfireside.com Phone: (916) 331-2438 Fax: (916) 331-8964 Number of Stores: Two Number of Employees: Full-time: 14 Part-time: varies
32 | DECEMBER 2019 | www.hearthandhome.com
Sq. Ft. of Building Space: Showrooms – 4,000 in Sacramento, CA; 3,000 in Elk Grove, CA Warehouse: 6,000 Lines Carried: Avalon, Dimplex, Fireplace Xtrordinair, Harman, Hearthstone, Iron Strike, Kozy Heat, Lopi, Majestic, Stûv, True North, Valor, Vermont Castings, Rais, Astria, Amantii, DaVinci, Flare, Heat & Glo, Mason-Lite, Modern Flames, Montigo, Napoleon, Supreme, Town & Country, Valcourt, Element 4 % of Annual Gross Sales for Advertising: 3% – TV 25%, Digital Media 25%, Print 25%, Special Promotions and Miscellaneous 25%
Heller describes himself as being financially conservative, so he is “judicious” with his marketing. “You can spend an unlimited amount of money on marketing,” he says, “but you don’t want to spend more than you can afford.” Dealers spend their advertising dollars in a variety of ways, and like most, Heller spends his dollars in ways tailored to his markets. “We try to be savvy marketers,” he says. Heller allots about 3% of his gross annual sales to advertising. Much of that is in television spots, and he uses billboards in the areas around his two stores, plus some print ads in local home magazines. “We still have a small presence in local phone books,” he says, “for those folks who have not yet adapted to the new era of finding things online.” Heller also participates in the one big home show in the Sacramento area. “We like this because it brings in a large cross-section of the community,” he says, “people we may not reach with our other forms of advertising.” Like most dealers today, Heller is into social media but found he needed to do more. “I was trying to do it all myself, but I didn’t have the time to do enough postings.” Now, one of his salespeople has the responsibility for Custom Fireside’s social media. “Now we have somebody who knows and loves social media; we’re doing much better and that is helping our sales.” Custom Fireside sits in the hotbed of recent efforts in California to eliminate wood-burning, and now to curb the use of natural gas. “Consumers need to be educated that they still can burn wood and still can install wood or gas appliances even in new homes,” Heller says. “This year we are benefiting from PG&E turning off people’s electric power in the name of ‘wildfire prevention.’ Our products still work and can still heat a home even without electricity.” If Heller were to offer advice to a new dealer, he would say, “work with strong vendors who are going to support you and going to support their products. Keep your market area small enough, geographically, so your installers can get at least a couple of installs done each day. Be sure to treat your employees with respect, and align yourself with people who have strong expertise in our industry.”
Without the need for electricity or a fan, Valor fireplaces fill the holidays with highly efficient radiant warmth and naturally circulated convection.
| Barbecue Sales: Past & Future |
WHAT’S COOKING? INTERVIEWEES Casey Harvey – Ray Murray Inc. Mike Hopsicker – Ray Murray Inc.
What was, what is, and what’s to come in the barbecue category.
Peter Ross – Home & Hearth
By Lisa Readie Mayer
Mike Rutherford – Rutherford Equipment
marketing promotions, and more. The participants also get real about challenges facing the industry, their companies, and their specialty-retail dealer partners. Finally, the panel offers an informed look at what we might expect in 2020. (Spoiler alert: despite some election-year jitters, most are quite optimistic about next year.) The consensus was not as universal on other topics. Indeed, opinions in the barbecue industry are as varied as rib recipes. For instance, some distributors are having success at the luxury end of the market, while for others, mid-priced grills and appliances are performing better. Outdoor kitchens dominate some areas, but have been slower to catch on in others. As distributor Mike Hopsicker, president of Ray Murray, so aptly put it, “What you focus on, you generally succeed at.” Here’s a look back at the world of barbecue in 2019, and a look forward to 2020.
John Tatro – Sierra Select Distributors Robert L. Wilk – Robert L. Wilk Inc.
T
he calendar is coming to an end, which makes it a fitting time to take stock, analyze results, and observe trends from the previous 12 months, and then use that information to chart a course for the coming year. That’s exactly what we asked a selection of barbecue industry wholesale distributors and manufacturer’s reps to do, and we’re sharing the findings with you on the following pages. The group sitting in on this virtual roundtable represents regions all over the country, and weighs in on trends in grill categories, popular price points, the Outdoor Room concept, successful
34 | DECEMBER 2019 | www.hearthandhome.com
Mike Rutherford, President Rutherford Equipment
Alabama, Florida, Georgia, Mississippi, North Carolina, South Carolina, Tennessee, Virginia
For six decades, this family-owned, thirdgeneration wholesale distributor has supplied gas equipment, and hearth and barbecue products, to specialty retailers throughout the Southeast. This year was a good one for the company overall, and particularly so in the grill segment, with sales up “considerably,” according to company president Mike Rutherford. In the outdoor space, Rutherford Equipment distributes Fire Magic, American Outdoor Grills (AOG), Summerset Professional Grills, American Muscle Grills, Memphis Wood Fire Grills, MHP, American Fyre Designs, Stellar Hearth Products, Mason-Lite Fireplaces, and Firegear Outdoors.
ILLUSTRATION: ©2019 A.E. BROWN.
Rutherford attributes some of the growth to a robust new-construction market in Florida and other regions within the company’s territory. “Builders are offering outdoor kitchens as part of their optional packages, and showcasing them in model homes,” he says. “As a result, we’re seeing more demand for built-in grills and outdoor kitchen products.”
Mi
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R u th e r fo r d
After meeting football and baseball legend Bo Jackson – named by ESPN as the greatest athlete of all time – at an HPBA show, Rutherford Equipment partnered with Bo Jackson Signature Foods on a promotion that runs through this year. The deal offers a package of rib-eye steaks and a personal note from Jackson, for each single consumer purchase of grills and outdoor
of picking the ‘wrong’ product, and prevents them from ending up with outdated inventory or a lot of dead stock,” Rutherford explains. “They very much depend on distributors to deliver product in a couple days. It makes things challenging for distributors. We need to have the right mix of inventory to be able to respond quickly.” As for 2020, Rutherford remains cautiously optimistic. “In election years, people tend to be conservative with their purchases,” he says. “They’ll spend on needs more than wants, and that could impact the luxury grill market. We have to be prepared for that possibility, but as long as the economy stays where it is, it should be another good year.”
“Consumers are gravitating to grills at the middle price points, and those mid-range lines are really increasing. These gains outweigh any decreased sales of the premium-priced products.”
According to Rutherford, about 95% of the company’s grill sales are built-in models. Sales of other built-in components also are increasing, as consumers expand the number of elements they’re incorporating in outdoor kitchens. He says dry-storage cabinets are increasing in popularity for outdoor kitchens, as a result of dealers educating consumers about the benefits of the sealed, weatherproof storage units versus traditional, door-and-drawer built-ins. In addition, Rutherford says, Summerset’s new Madera Series of outdoor kitchen elements, combining stainless steel with rich-looking wood panels and handles, is attracting attention. “It offers a unique look in an outdoor kitchen,” he says. He says pellet grills from Memphis Wood Fire Grills have been a bright spot this year. “The pellet category is in its infancy and still growing rapidly,” says Rutherford. “We got the Memphis line about 18 months ago and have seen a lot of growth. It’s been a really good line for us.” Rutherford says gas grills continue to dominate his grill sales, but the company has experienced a noticeable dip in sales of ultra-premium grills at the highest price points. “Consumers are gravitating to grills at the middle price points, and those mid-range lines are really increasing,” he says. “These gains outweigh any decreased sales of the premium-priced products.”
Mike Hopsicker, President and Casey Harvey, Director of Sales, Ray Murray Inc. Midwest, Northeast, Mid-Atlantic, and Southeast States east of the Mississippi River
kitchen products over $5,000 retail. This effective incentive has been used by dealers to help close a sale, or reward a salesperson, according to Rutherford. The distributor is noticing “Spiff” programs becoming more prevalent in the grill industry. According to Rutherford, the trend is modeled after the common applianceindustry practice of paying incentive bonuses
With a territory spanning states east of the Mississippi River, and warehouse facilities in Massachusetts, Pennsylvania, Michigan, and North Carolina, Ray Murray Inc. is one of the nation’s largest two-step hearth and grill distributors. (The company also is a major distributor of
“When we started with outdoor kitchen products, our company, and the grill manufacturers we partnered with, were ahead of the curve. There was a lot less competition.” to retail salespeople for selling a specific product. “Each manufacturer or distributor works their program differently, but I see them as a positive for the industry,” he says. “These added incentives are a way to keep good employees.” Another trend he’s seeing: Very few retailers stock product inventory these days. “For dealers, this lessens the risk
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propane parts and equipment, a segment that accounts for half its business.) “We had a relatively good year in 2019, particularly in high-end grills, which is what we emphasize,” says Mike Hopsicker, company president. He says products from Twin Eagles, Delta Heat, Delsol, Fire Magic, and AOG lines make up the lion’s share of the company’s grill sales. “We’re Click here for a mobile friendly reading| experience www.hearthandhome.com DECEMBER 2019
| 35
| Barbecue Sales: Past & Future |
36 | DECEMBER 2019 | www.hearthandhome.com
Ro ss
market their outdoor kitchen business locally to develop referring relationships and partnerships.” He says successful dealers invite specifiers to lunch-and-learn type events, training sessions, and other programming to position their store and staff as product authorities and essential partners. “The dealers who focus on this business do
te r
seeing more growth at the highest end of the category,” he says. “There is a lot of competition at the mid-price-point level.” Twin Eagles’ new pellet grill exceeded sales expectations. “We sold more than we ever anticipated in its first year out,” according to Hopsicker. He says the company experienced “decent growth” this year in cart grills from Broilmaster, MHP, Phoenix Grills, and Camp Chef, as well as in outdoor hearth products from RH Peterson, Firegear, and Bromic Outdoor Heaters. By contrast, the company’s kamado business – it sells Primo Ceramic Grills – was down this year, according to Hopsicker. “Ceramic kamado cookers are losing a bit of marketshare to pellet grills,” he explains. He believes the recent purchase of Primo Ceramic Grills by Empire Comfort Systems should help the line rebound next year. “Primo is a great product and this move will improve marketing for the brand,” he says. After 10 years of double-digit growth, the company’s sales of outdoor kitchen components “has slowed a little in the last couple years, but remains steady,” according to Hopsicker. “When we started with outdoor kitchen products, our company, and the grill manufacturers we partnered with, were ahead of the curve. There was a lot less competition and we were growing our dealer base by significant numbers every year. Now, it’s a more mature market, with a stable dealer base and stiffer competition.” Hopsicker says, beyond a built-in grill and refrigerator, sinks are gaining in popularity in outdoor kitchens and power burners are outselling sideburners. The latter trend is a particular win-win, according to Hopsicker. “A power burner adds cooking versatility for the consumer, and benefits dealers because it increases the spend,” he says. Hopsicker says outdoor kitchen design preferences remain regional. “In the Midwest, we’re still seeing a lot of stone islands, but modern-looking modular cabinetry is catching on along the East Coast.” According to the company’s director of Sales, Casey Harvey, “Dealers who are successful with outdoor kitchen products align themselves with pool builders, hardscape dealers, landscapers, and other businesses that are already in the backyard. Most hearth shops can’t do a full outdoor build, but they are the product experts. We emphasize that retailers need to actively
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“People are creating outdoor spaces that feel like an extension of the home rather than an extension of the yard.” well,” Harvey says. “The guys who bring it in and expect it to take off on its own, don’t see the same results.” Both Hopsicker and Harvey are optimistic about the coming year, and are expanding sales resources to ensure continued growth. “What you focus on, you generally succeed at,” says Hopsicker. “We think there is room for growth in the barbecue industry.” Peter Ross, President Home & Hearth – Southwest, Prairie States, Hawaii
After years spent building a strong dealer base for hearth products and several grill brands throughout the Southwest, Prairie States, and Hawaii, independent manufacturer’s rep Peter Ross, president of Home & Hearth, has expanded his focus to include outdoor kitchen cabinetry and patio umbrellas. The business shift was an effort to offer more counter-seasonal products to hearth dealers.
The added lines – Danver Stainless Outdoor Kitchens, Brown Jordan Outdoor Kitchens, and Frankford Umbrellas – once small additions to the business, have gained traction, and now equal the company’s hearth product sales, according to Ross. “About 80% to 90% of the outdoor kitchens in the U.S. today are stone or steel-frame islands built onsite,” according to Ross. “But we’re seeing a huge trend – especially in high-end projects – toward modular cabinetry-based systems. They offer more usable space and a more contemporary look.” He says the growing number of companies now offering modular cabinetry systems in either stainless steel, HDPE, or aluminum, is evidence the concept is catching on. Being involved in his dealers’ outdoor projects gives Ross an insider’s perspective on trends in grills, outdoor kitchens, and Outdoor Rooms. “I see their designs, so I know what grills and appliances are specified,” he says. “They tend to be premium products. If someone is putting in a Brown Jordan or Danver outdoor kitchen, they’re putting in high-end grills and appliances from companies such as Twin Eagles, Wolf, Alfresco, Caliber, True, and Summit.” Another trend he’s identified: Homeowners are opting for more elaborate outdoor kitchens. “Ten or 15 years ago, an outdoor kitchen included a counter with a grill, a mini fridge, and maybe a sink,” he says. “Now, outdoor kitchens are like indoor kitchens with much more functional workspace and a greater selection of appliances and elements, like power burners and trash pull-outs. People are creating outdoor spaces that feel like an extension of the home rather than an extension of the yard.” Ross says, “A lot of fun and innovative cooking products are being integrated into outdoor kitchens today.” He is seeing more pellet grills being built in, thanks to the availability of stainless-steel pellet grills from premium manufacturers. Gas pizza ovens also are becoming more popular, he says. Another cooking product on his radar: induction burners installed directly beneath a granite counter surface. “It’s a new product I saw at the kitchen and bath show. You don’t see the burners, just the counter, for a very sleek look,” he says. “It could be done indoors or outdoors. It’s very cool.”
Paralleling indoor kitchen trends, Ross is seeing a greater variety of under-counter appliances and accessories available for outdoor kitchens. “Under-counter outdoor refrigerators, freezers, freezer/fridge combos, and ice makers make the space more functional,” he says. “Consumers can make the outdoor space whatever they want it to be.” According to Ross, premium, cabinetry-based modular outdoor kitchens are gaining traction in affluent markets.
of outdoor kitchen projects, the homeowners are working with a designer, so it’s really important to establish a direct connection with these specifiers. They are the ones recommending product to the end customer.” As a board member for the HPBA Pacific, Ross is closely monitoring the issue of natural-gas legislation in California communities. “It’s not the state, it’s the individual city councils that are making these decisions,” he explains. “They’re all approaching it differently, and often
“We have great brands
Jo
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that continue to innovate and bring products to market that people want. You can only focus on what you have control over.”
“It’s a regional trend,” he says. “We have a lot of business along the coast and in wealthy areas like Scottsdale, Denver, Aspen, and Breckenridge. It’s not as popular in smaller mountain communities where people are more likely to opt for a rock island or even a cart grill. It’s not for every retailer, but those with the right customer base are doing well with it.” Ross says dealers in a variety of channels, including hearth and barbecue retailers, appliance dealers, kitchen and bath design shops, and interior design studios, are having success selling modular outdoor cabinetry. He has also set up dealers with established businesses building masonry outdoor kitchens, who want to branch into cabinetry systems. There are commonalities among dealers who are successful in the outdoor kitchen business, according to Ross. “They put energy into marketing and promoting,” he says. “It’s not enough to have the product on the sales floor; you have to go beyond your doors and reach out to designers, landscapers, architects, and builders. “The simplest and most effective thing a dealer can do is pick up the phone and ask to meet with specifiers in their community to educate them about the product. In a lot
without a lot of study or understanding of the ramifications of these actions. It’s concerning for hearth manufacturers and dealers. They’re not prohibiting propane, so we don’t know yet if or how it will impact the barbecue world.” John Tatro, President Sierra Select Distributor California, Arizona, Nevada
With roots dating back to the late 1950s as a television parts supplier, Sierra Select Distributors has evolved to become a major wholesale distributor with three business divisions – home appliances and outdoor living products; custom home integration; and auto entertainment electronic products – throughout California, Arizona, and Nevada. “Diversity is our strength, but there is also a lot of synergy between these industries,” says company president John Tatro. Technology is the common, unifying thread, he says. “Smart technology is in the car, the home, and even outdoor appliances, and many of these products are app driven. The connected home is not just in the luxury market; it’s widespread in the mainstream today.” A growing segment of the company’s business is to consolidate and integrate
consumers’ many home-system apps into one simple, customized app program that can be used to control multiple things. “For instance, if you’re leaving the house, you would be able to use one app button to close your shades, turn off the lights, change the thermostat, lock the doors, close the garage, and do the other things you need to do when you leave the house, rather than opening each of these product apps individually,” Tatro explains. “Then, when you return home, one button controls everything that needs to happen when you enter the house.” According to Tatro, the trend hit a high gear beginning with the Nest smart thermostat. “It revolutionized the difficult and cumbersome process of programming a thermostat,” he says. “That one product had such simplicity of use that it launched a wave of all types of products that could be easily controlled by apps. Technology allows you to do more from anywhere you happen to be.” He says he’s seeing more and more smart, app-controlled products in the outdoor space. He points to outdoor lighting products, patio shades, fire pits, televisions, speakers, and grills that incorporate smart technology and are controlled by apps today. His company also distributes an app-controlled yard-sprinkler system that can be programmed to monitor the weather report and adapt accordingly when connected through Wi-Fi. “The trend is really expanding outdoors,” he says. An example is the EGG Genius, a smart, interactive temperature controller for the Big Green Egg, that Tatro says was a big seller this year. The accessory product lets users monitor and control the grill temperature and cook time, and track the internal food temperature on a phone, tablet, or computer through an app. “People can control their Egg right from their couch,” he says. He says sales of other Big Green Egg accessories also grew “exponentially” this year. “This is important because it engages consumers and drives them back into dealers’ stores,” he says. Tatro says solid sales of kamado accessories help keep the category “strong and viable.” The distributor added 65 new Big Green Egg dealers in its territory year-to-date and maintained “steady sales” in the line this year. “Our kamado grill sales were flat, but I’ll take that,” he says.
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| Barbecue Sales: Past & Future | “Our challenge is that Big Green Egg is not a culture out here like it is in the Southeast, where it’s a way of life,” he explains. “We do a lot of high-profile events like food and wine festivals, and the Country Music Awards, and we’re involved in several Eggfests that generate high-level exposure, but we’re still trying to increase awareness.” He believes Big Green Egg’s partnership with Ace Hardware will help on that front. “All Big Green Egg dealers get leverage out of Ace featuring the product in advertising,” Tatro says. Another potential benefit for kamado dealers, according to Tatro, is a growing sense of “buyer’s remorse” he has observed
backyards, and see what else they might need,” he explains. “It’s an opportunity to make another sale.” Tatro says sales of built-in gas grills have been steady, but without much growth. The company distributes its own privatelabel line under the Solé Gourmet brand. Its Solé Gourmet-branded wood-fired pizza ovens, imported from Italy, have been “good sellers,” and outdoor refrigerator sales remain strong, according to Tatro. The company distributes outdoor kitchen islands from Challenger Designs. “They have been very popular,” he says. “People like the portability; you can take them with you if you move, or change their
“Sometimes retailers
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question how many outdoor kitchens they can sell and hesitate to put them on the floor. But there are lots of opportunities to make a sale, and every sale is a big sale.”
among some new pellet grill owners. “These are consumers who bought into the hype about pellet grills, but now are frustrated by the nightmare they can be to clean,” he says. “Also, the temperature range is comparatively limited, and if the power goes out, the grill can’t be used.” He says these rumbles of dissatisfaction may signal a rebound trend for kamado sales in the coming years. Tatro says sales of fire tables from The Outdoor GreatRoom Company have been “growing exponentially,” fueled by innovative designs and burner technology. “We are in a good climate where the outdoor space is used year-round, so that helps, too,” he says. Pergola kits from The Outdoor GreatRoom Company also are doing well for the distributor. He says some dealers sell unassembled kits to do-it-yourselfminded customers, while others offer assembly and installation services. “This is another opportunity for our dealers to engage their customers, gain access to their
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location in the backyard. And they have the ‘wife factor’ – they look good, they introduce color to the patio, and the highgrade aluminum holds up in the elements. The barbecue is considered a man’s space, but females have a big say in these spends, particularly in outdoor kitchens.” Tatro says the impact of tariffs is presenting a challenge for his company. “With our gas grills, we’ve been able to pivot manufacturing to some countries outside of China, but the outdoor refrigeration category has been hit hard by a 25% tariff,” he says. “Even if a product is not on the tariff list, tariffs may have hurt the factory where it’s made, so companies have to find other sources.” Another challenge Tatro observes is a growing income gap in his region, a factor that may dampen the market for outdoor living products. “We have a dynamic territory, ranging from some of the wealthiest areas in the world to some of the poorest,” he says. “In California, the cost of living is very high, and a large part
of the middle class is so saddled with debt that it’s choking discretionary dollars. The 1% will always have discretionary dollars, but discretionary dollars are squeezed for the greater portion of the middle class.” In addition, he says issues such as high rents, the drug epidemic, and lack of mentalhealth treatment in the region are combining to create an increasing homeless population in some of his territory. “The situation is causing real problems for some retailers,” he says. “People are living on the street right in front of stores, and these shop owners literally have to hose human feces off the sidewalk every morning. This is a growing problem up and down the entire West Coast – in Seattle, Portland, Sacramento, San Francisco, Los Angeles, and San Diego.” He says the situation scares away shoppers, who opt to buy goods online instead of venturing into the impacted stores. “The lost income to the local economy only compounds these societal problems,” says Tatro. “The homeless crisis is primarily being ignored by people we’ve elected and has been disguised as a housing issue.” As for next year, the distributor is “always optimistic,” despite the trepidation he says historically comes in an election cycle. “People tend to hold onto their money (in an election year), so you never know what to expect,” he says. “But we have great brands that continue to innovate and bring products to market that people want. You can only focus on what you have control over.” Robert L. Wilk, President, Robert L. Wilk Inc. – Indiana,
Kentucky, Michigan, Ohio, West Virginia
Before becoming an independent manufacturer’s rep 10 years ago, Bob Wilk spent more than two decades as the general manager, and barbecue, fireplace, and lawnand-garden products buyer for a retail business with two stores in Michigan. That vantage point lends a distinct advantage when working with dealer partners today, as a representative for multiple lines of outdoor living products. “My customers realize I have been in their shoes,” he says. “They know I have sat on their side of the table and understand what they need. Because of that, they are comfortable asking for advice and sharing information with me.”
Wilk says grill sales were “off a little bit” in the Midwest this year, due to wet spring conditions that didn’t improve until late in the season. Fortunately, pleasant weather with temperatures in the 80s and 90s extended into the fall and delivered a strong sales resurgence that helped mitigate early-season losses. “We were surprised to see grills still moving well in September and October,” he says. According to Wilk, mid-priced grills sell best in his region. “Consumers are looking for value,” he says. His grill sales break out 60% built-ins, 40% on carts. “We’re starting to see more and more outdoor kitchens,” he says. “It’s definitely happening in areas along Lake Michigan where there are a lot of multimillion-dollar homes. These homeowners want a showy outdoor kitchen setup.” The outdoor-living trend is even moving beyond the backyard, according to Wilk. He has seen a growing number of outdoor kitchens being built into RV parks near
in his territory. “Customers are moving into second-generation pellet grills now,” he says. “People are ready to trade up to higher-priced pellet models.” He says his sales of TEC infrared grills have been steady. Wilk points out that, although cooking on an infrared grill requires a little more training, once consumers master it, they are very satisfied. “TEC has the advantage of a wider temperature range compared to other infrared grills. You can turn the heat down 75% to 80% to cook at lower temperatures,” he says. “It’s a high-quality line without a lot of frills, which is exactly what people are looking for. They want value, and the fact that it’s made in the USA is a big selling point.” Wilk says accessories are trending. “They are a strong part of the barbecue business today,” he says. “Accessories like wood-chip holders, pizza racks, and other gear, keep people coming back to see what’s new. People will spend money on them.”
“Your website is the first introduction to your business. You need to keep it up-todate, make it easy to navigate, and hook people with photos and videos that will attract their attention.” — Bob Wilk
Lake Michigan. “People own their RV spot and go back year after year, so they want to add an outdoor kitchen for their personal use,” he explains. “They pull their $200,000 RV into the spot and they have their outdoor kitchen setup right there so they can enjoy the lifestyle. “Sometimes retailers question how many outdoor kitchens they can sell and hesitate to put them on the floor,” Wilk continues. “But there are lots of opportunities to make a sale, and every sale is a big sale. The thing is, you have to show the product on your sales floor and on your website to inspire the dream for your customers.” His dealers have indicated that kamado grill sales have been softer this year, but the category is helped by ongoing sales of charcoal and accessories. Wilk also has seen a “growing influx” of pellet grills
He says consumables are another important part of the product mix. “Customers want good charcoal and keep returning to buy it,” he says. “Or they see 10 varieties of cooking-wood pellets and come back to try the alder pellets and the cherry wood pellets, and all the other different types. It’s important for dealers to stock these kinds of items, so customers don’t need to go anywhere else for them.” According to Wilk, fire tables remain a “very strong” category. “Fire tables of all different heights are – pardon the pun – hot,” he says. “The category is very easy to sell. Likewise for deep-seating outdoor living room sets.” He says his most successful dealers pay attention to marketing and promotion, and try to tie in with community events. “One dealer drives traffic by participating
in a local classic car show,” Wilk says. “He demonstrates a variety of grills to introduce people to all the different options. He has good signage and does a giveaway item, like a grill brush, in a nice bag with the store’s logo. As retailers, we often get too busy and forget about promoting outside the store, but these community events are effective.” He says cross-promoting with other local businesses also works. “One dealer partnered with a high-end meat market and gave customers a $50 gift certificate to spend on meat with the purchase of a grill. The dealer split the cost of the gift certificate with the butcher, which made the promotion very cost-effective.” Wilk adds that having a good website is critical. “Today, everyone starts the shopping process online and checks out your website before coming into the store,” he says. “Your website is the first introduction to your business. You need to keep it up-to-date, make it easy to navigate, and hook people with photos and videos that will attract their attention. “OW Lee has fantastic videos of fire tables with flickering flames and glasses of wine set on top. It paints a picture and creates a dream for the customer.” Wilk also suggests creating a photo gallery, both in the store and on the website, to showcase completed projects. “It helps people see what’s possible in their backyard,” he says. Wilk says finding good employees to fill sales, installation, and delivery positions is the “biggest obstacle” facing his dealers today. “It’s been a tough go for many of them,” he says. “With unemployment so low, it’s hard to find people with the skills to do these jobs, or who necessarily even want to do these jobs. Sometimes a dealer will bring someone in and the person will only last a day or two. It’s difficult.” Wilk says the challenge of online competition has “calmed down a bit,” thanks to “manufacturers having good MAP policies in place.” In addition, he believes new laws requiring online sellers to collect state taxes are further helping to level the playing field for brick-and-mortar retailers. “Retailers don’t seem to be as upset about Internet competition recently,” he says. Wilk is “cautiously optimistic” about 2020. “It’s an election year and that always comes into play,” he says. “But I’m expecting a good year.”
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| Retailing |
ISLANDS IN THE
SOUTHWEST BBQ Island is a three-store retail oasis of barbecue and outdoor living products, backed up by a strong social media and educational element.
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By Lisa Readie Mayer
W
ere you to find yourself marooned on a desert island, you couldn’t find a better one than BBQ Island. The Arizona retailer, with locations in Scottsdale, Tempe, and Peoria, is a well-stocked oasis for outdoor cooking and entertaining enthusiasts. It carries more than 30 brands of barbecue grills, as well as a huge selection of outdoor kitchen components, barbecue accessories, sauces, rubs, charcoal and pellet fuels, fire pits, outdoor televisions, and every other conceivable product for creating a backyard paradise.
But opening a one-stop-shop for outdoor culinary pursuits was not on CEO Mike West’s radar when he moved to Arizona after college and took a job with timber-products company Weyerhaeuser. As a sales rep, West sold fiber-cement board to several businesses that manufactured outdoor kitchens in his Southwest territory. “I never saw outdoor kitchens in Oregon where I was from,” he recalls. “I thought they were fantastic.” So inspired was West that he approached one client about the possibility of opening a franchise business to sell prefab outdoor kitchens. “The owner didn’t give me the time of day,” he says. Instead, West found
PHOTOS COURTESY: ©2019 BLUR LIFESTYLE BRANDING. WWW.BLURLIFESTYLE.COM.
Mike West
Upper Right: Mike West, CEO, with at least 30 brands of barbecue grills.
a more-amenable manufacturer and he and a friend partnered up to sell the islands as a side gig to their day jobs. About the same time, another of West’s sales accounts had hit a rough patch and was looking to unload a large quantity of stainless-steel, built-in doors and drawers. West used his annual bonus to buy the lot, and sold the components on eBay out of his garage. The side hustles took off, so much so that West quit his day job, and he and his now former partner founded their own outdoor kitchen company. They opened BBQ Island in 2002 in an industrial warehouse with enough space for a showroom and manufacturing operations for their prefabricated islands.
“We opened within a few months of (the terrorist attacks on) 9-11, which some people thought was crazy,” says West. But he persisted, peddling the islands at local home shows, and the business grew. “Fortunately, our area has always had a strong housing market, so that helped. We’ve had double-digit gains every year since we started the company.” A Change in Direction That growth trajectory was challenged in 2008, when the country hit an economic downturn. “We were making very highquality islands at a time when people were foreclosing on their homes, and even those who weren’t, didn’t want to spend a lot on non-essential purchases,” West says.
The situation, coupled with manufacturing uncertainties due to fluctuating material and delivery costs, sparked a strategic change for the company, as well as, arguably, more crazy moves. “At the height of the recession in 2008, we bought the building, opened a brick-and-mortar retail store, and stopped manufacturing the islands,” West says. In addition to its retail focus, BBQ Island created a wholesale division to sell grills and outdoor kitchen components to contractors, pool builders, landscapers, and others who were designing and building outdoor living spaces in the area. The company also sold online through its website and third-party marketplaces such as Amazon. Click here for a mobile friendly reading |experience www.hearthandhome.com DECEMBER 2019
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| Retailing |
West supports brands that offer exclusive lines for brick-and-mortar specialty retailers, and tries to avoid lines found in warehouse clubs and Big Box stores. This is a class with Pitmaster Moe Cason. Moe was a contestant, judge, and star on Destination America’s “BBQ Pitmasters” and “BBQ Pit Wars.”
This is a class with Pitmaster Jess Pryles. She is an author, TV personality, and creator of Hardcore Carnivore sauces and rubs, as well as the grill line Pitts & Spitts.
It proved to be a smart move. By 2010, BBQ Island had outgrown its original Tempe location and acquired the building next door to create a 14,000 sq. ft. hub that combines retail space, corporate offices, and warehouse facilities. In 2013, the company added a 6,000 sq. ft. second location in Scottsdale, and in 2016, opened a third location in the Arrowhead section of Peoria. The company’s total annual sales are between, ballpark, $15 million and $20 million. Thirty percent of BBQ Island’s sales today are online, through its website and thirdparty sites such as Amazon. But West believes that share will shrink now that online sites have to collect sales tax. “Our online sales are already down due to it,” he says. “The
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situation is very difficult – it’s a huge mess, actually. The tax percentage is different in every state, and the tax originates from where the consumer is located. It’s a lot of administrative work to deal with sales tax and monitor MAP pricing for our online sales. It’s a huge pain in the butt.” The upside has been double-digit gains in BBQ Island’s brick-and-mortar stores. “It was the best year since we’ve been open,” West says. “A lot of people come in with quotes they get online, and between tax and MAP pricing, a lot of times the stuff costs less to buy in the store. We want to be able to help the customer and keep the sale local, so we’ll work with people.”
Island Provisions The business offers one of the largest selections of barbecue and outdoor living products in the Southwest, if not the country. It carries a wide variety of gas grills, smokers, kamados, and pellet grills in a range of price points from more than 30 manufacturers, including Twin Eagles, Napoleon, Bull, DCS, Fire Magic, Hestan, Lynx, Alfresco, Portable Kitchens, Big Green Egg, Kamado Joe, Primo, Memphis Wood Fire Grills, Green Mountain Grills, and Traeger, as well as its own BBQ Island private-label brand. The stores also carry a broad assortment of barbecue tools and accessories, as well as an extensive selection of charcoal, pellets, wood fuels, sauces, spice rubs, marinades, and other consumables. West says he mostly supports brands that offer exclusive lines for brick-andmortar specialty retailers, and tries to avoid lines found in warehouse clubs and Big Box stores, because they typically have slim margins. West says high-end premium-priced gas grills have been “a mixed bag” of late, with sales of some brands such as Twin Eagles up, while other luxury lines are down. Midpriced units from domestic manufacturers are selling best, according to West, with Delta Heat from Twin Eagles and Sedona by Lynx his gas-grill standouts this year. “People are finding value in domestic mid-line grills,” he says. “Imports are struggling with tariffs and have raised prices, so people figure, why not spend a little more
and get a higher-quality ‘fit and finish,’ and better features. Due to tariff-related price increases, we’ve seen a decline in sales of brands that source overseas. Even our own BBQ Island’s brand of imported grills was hit hard. We’ve absorbed some of the price increases without passing them along to the consumer – as have other manufacturers and distributors – but I guess, in the long run it may bring some manufacturing back to the U.S.” West says pellet grills have been “very popular.” The Prime Grill from Green Mountain Grills was BBQ Island’s hottest seller this year, according to West. The business also carries pellet grills from Traeger, Memphis Wood Fire Grills, Fast Eddy’s by Cookshack, Pitts & Spitts, and Louisiana Grills Estate Series. Big Green Egg is the only kamado brand displayed in-store, but BBQ Island also sells Kamado Joe and Primo online. West says that, while sales of Big Green Egg were down, his Kamado Joe sales were up more than 100% over last year. “The brand is very innovative, and being part of the Masterbuilt supply chain helps,” he says. While West says pizza oven sales have been “hit or miss,” he credits Alfa Ovens with driving traffic into his stores. “They are doing a good job of marketing. People are coming in asking for Alfa Ovens specifically,” he says. West says the bulk of his grill sales are built-ins for outdoor kitchens; cart grills account for less than 5% of his grill business. BBQ Island does not offer outdoor kitchen design-build services, but rather supplies grills and equipment for projects by landscapers, builders, designers, and other referral partners. “Half the time customers are referred to us and come in with plans and already know what they want,” says West. “When they come in it’s beneficial for us, because consumers often don’t know what’s possible or available for Outdoor Rooms, so we try to educate them. They’ll often upgrade.” The stores also host after-hours demo events for specifiers to educate them and develop referring relationships. West just signed on as a dealer for Urban Bonfire modular outdoor kitchen cabinetry, and is adding displays to each of the stores. He believes the line’s sleek design will fill a need for “people who
are looking for something different than a stucco island with a tile top.” As with masonry outdoor kitchens, BBQ Island will assemble and deliver the grills and cabinetry, but let landscapers and other partners handle the installation. “You never know what you’re going to find in the backyard,” he says. For similar reasons he refers warranty issues, service calls, and island retrofits and replacements to an independent third party to handle. “He’s actually one of our customers,” says West. “He takes care of all the grills in our stores and does a really great job. This situation works better than us having service people on staff. Our service partner has less overhead, so he can charge less, and he’s skilled working with gas. We don’t have to take on that liability.” Creating Excitement and Driving Traffic West says BBQ Island’s outdoor cooking classes have been an excellent way to create in-store experiences, build excitement, strengthen customer relationships, and grow business. Each store typically hosts a couple classes a month, year-round, and West says they often see a lot of “snowbirds” who return to the area every winter and take classes. Class topics rotate frequently and include everything from
grilling holiday meals to grilled appetizers to barbecue classics. A recent “Steak 6 Ways Masterclass” ($75 per person), covered fire management, steak selection, and cooking techniques for ribeye steaks, tomahawks, and prime rib, on multiple types of grills and smokers. “Date Night” classes ($99 per couple) are very popular, according to West. “Guests enjoy a multi-course meal, have the entertainment of the class, and they can bring a bottle of wine,” he says. “It’s a great deal that costs less than a restaurant dinner out. It’s all about the experience.” Classes are taught by a changing roster of professional pit masters made up of local chefs, caterers, and store employees (some of whom are competition cooks). Manufacturer partners also sponsor classes and provide their culinary spokespeople to teach, such as the recent Traeger Pellet Grill’s Shop Class with TV-celebrity barbecuer Diva Q. “You need to have the right person teaching the class – they have to have marketing savvy,” West explains. “We ask the instructors what products they’ll be using in class, so we can stock them. We’ll create a display of the instructor’s cookbooks to sell, as well as the sauces, rubs, tools, accessories, charcoal, and wood chips they use in the class – even right down to the butcher paper they use.
This is a class with Pitmasters Malcom Reed of “How to BBQ Right,” and Heath Riles. They are YouTube sensations and some of the best on the competition circuit.
www.hearthandhome.com | DECEMBER 2019 | 43
| Retailing | “Classes are a great vehicle to bring new customers into the store, and people almost always buy something. Sometimes they’ll spend hundreds of dollars after a class.” A few months ago, BBQ Island launched a series of free, live classes on Instagram,
airing every Wednesday at 7:15pm. Hosted by BBQ Island’s employees, the threeminute segments cover tips, techniques, and recipes for preparing a different dish each week. According to West, viewership has been growing steadily with each segment.
Tempe location. Store Name: BBQ Island Locations: 1715 W. Ruby Drive, #105, Tempe, AZ 15815 N. Frank Lloyd Wright Blvd., Scottsdale, AZ 8155 W. Bell Road, #111, Peoria, AZ Owner: Mike West - CEO Key Executives: Adam Ebert, CFO Year Established: 2002 Website: www.bbqislandinc.com Email: mwest@bbqisland.com Phone: (877) 474-5669 (Tempe Location) Number of Stores: 3 Number of Employees: 22 Gross Annual Sales: $15 million - $20 million
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Sq. Ft. of Building Space: 14,000 including retail, office, and warehouse space, Tempe
6,000 sq. ft. retail, Scottsdale
6,000 sq. ft. retail, Peoria
Lines Carried: Alfa Ovens, Alfresco, American Outdoor Grill, BBQ Island, Beefeater, Big Green Egg, Blaze, Bull, Cajun Grill, Caliber Range Corporation, Cookshack, Coyote Outdoor Living, DCS, Delsol, Delta Heat, Everdure by Heston Blumenthal, EVO, Firegear Outdoors, Fire Magic, Forno de Pizza, Green Mountain Grills, Hestan Outdoor, Kamado Joe, La Caja China, Louisiana Grills, Lynx, Meadow Creek, Memphis Wood Fire Grills, Napoleon, The Outdoor GreatRoom Company, Pit Barrel Cooker, Portable Kitchens, Primo Grills, Saber, Solaire, Solé, Summerset, The Good-One Smokers, Twin Eagles, Traeger, Urban Bonfire, Weber, and many more.
Though the retailer doesn’t necessarily expect to see the same kind of immediate returns as with the in-person cooking classes, the goal of the social media classes is to engage and entertain current and prospective customers, and teach them how to use and enjoy their grills. “Whether they’re just starting out with burgers or want to try competition barbecuing, we want to get people interested in all types of outdoor cooking,” says West. “We want to teach someone how to fully use their grill and all its features, rather than just sell them a pricy grill they might not use. “The more they use it, the more they’ll come back. The goal is to get them to be long-term customers. Instead of a one-time grill and outdoor kitchen components sale, we believe ongoing instruction and coaching keeps giving people a reason to return for fuels, sauces, rubs, and even more classes.” A robust social media marketing program also aids in that effort. The retailer has 11,600 followers on Facebook; 2,500 on Instagram; 2,700 on Twitter; and 500 each on YouTube and Pinterest. Posts offer tips, recipes, and other educational content, as well as promoting upcoming classes and events. West says the stores’ key customer demographic is in the 35 to 55 age range, with incomes over $75,000. Though shoppers skew 75% male, West understands that women are the decisionmakers, particularly on large spends. “That’s why it’s so important to get women in our stores for cooking classes, so they can see all the outdoor living products we offer,” he says. West credits his employees’ passion and enthusiasm for outdoor cooking for strengthening customer relationships and contributing to the success of the business. “We have 22 employees, and most everyone we’ve hired has been either a customer or a referral,” he says. “The camaraderie among employees and the customers is very cool.” This secret to success will be instrumental in West’s plan to open a fourth BBQ Island store in the coming year. “Every rep who comes in says they’ve never seen anything like our stores,” he says. “We think we have created something special.” You might say it’s a BBQ Island unto itself.
| Patio Sales: Past & Future |
CAUTIOUS OPTIMISTS INTERVIEWEES
Brian Blakeney – Kingsley Bate Mark Bottemiller – Ebel Zac Bryant – Lane Venture Kate Carret – Seaside Casual Jerry Epperson – Mann, Armistead & Epperson Mike Gaylord – Agio Bill Herren – Woodard Kathy Juckett – Telescope Casual Gary McCray – Klaussner Outdoor Gene Moriarty – Brown Jordan International Tom Murray – NorthCape Terri Lee Rogers – OW Lee Jessica Salisbury – Village Green Doug Sanicola – Outdoor Elegance David Schweig – Sunnyland Outdoor Living Debbie Stegman – Elegant Outdoor Living Bew White — Summer Classics
46 | DECEMBER 2019 | www.hearthandhome.com
If it isn’t the weather, it’s the tariffs, or the competition. By Tom Lassiter
Q. W hat does the casual furniture industry have in common with the stock market? A. Neither one deals well with uncertainty.
U
ncertainty gripped the casual furniture industry throughout much of 2019. The usual worries about bad weather during the crucial spring season were validated by lousy conditions
throughout much of the United States; outdoor furniture sales in the early months of this year took a big dive. The imposition of tariffs on products imported from China added another layer of concern that grew worse as time passed. The usual buying patterns were disrupted as retailers held back, waiting for prices to clarify and settle. The tariff spat with China has led to at least one manufacturer making drastic changes in its Asian manufacturing partners.
ILLUSTRATION: ©2019 A.E. BROWN.
Finally, factor in the ongoing evolution in how furniture is marketed and sold to consumers through an ever-expanding array of channels. That process continues to challenge furniture makers, as well as the surviving brick-and-mortar specialty store retailers who initially presented higher-quality patio furniture to the public. Result: uncertainty. That Pepto-Bismol panic, when you’re not sure what’s going to happen next. The effects rippled through every strata of the industry, from retail storeowners all the way up to furniture company executives. The impact was especially troubling for a seasonal industry whose financial health is dependent on accurately predicting future sales and, in turn,
Weather Woes Much of the nation experienced cold, wet weather during the early spring when homeowners plan their Outdoor Rooms and custom order furniture, expecting delivery in time to enjoy summer to the fullest. The effect on retailers and manufacturers was immediate. “The spring didn’t do us any favors,” said Mark Bottemiller, National Sales manager for Ebel Inc.
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The soggy spring in the Northeast and Midwest and even Southern California stymied retailers’ sales. “They have had two years of absolutely abysmal springs,” says Mike Gaylord, Agio’s vice president of Sales. “It’s been ruthless.” Only the Southeast had decent spring weather, he said. Brian Blakeney, vice president of Sales and Marketing for Kingsley Bate, exaggerated only a little when he described spring 2019 as “the rainiest s Je in U.S. recorded history.” Rain washes out casual furniture sales. “The first quarter was pretty horrendous,” said Gene Moriarty, CEO of Brown Jordan International. Moriarty had predicted sales to be flat or about the same as 2018. “We had a terrible April and a terrible May,” Salisbury said. Rain in normally arid Southern California lasted six to eight weeks, said Doug Sanicola, owner of Outdoor Elegance in La Verne. When the rains finally abated, they were followed in many places by instant summer and searing heat, which also can keep people out of retail stores and smother sales. Sluggish spring sales caused a ripple effect that resonated back through the sales and production channels, all the way to factory floors. Retailers didn’t sell through stock on hand as anticipated, and special orders didn’t ramp up until fair weather returned. This one-two punch delayed container reorders, leading to lost time in Asian factories. Special orders not placed until midsummer or later still take six or eight weeks to arrive, meaning the homeowner in northern climes may not get much use from the new furniture until the following year. Retailers risk having orders cancelled when sharing this fact. si
planning and scheduling production. That exercise is difficult enough for goods made on U.S. soil; it is compounded exponentially for goods made in Asia and that must be shipped across the Pacific. Uncertainty made 2019 the most challenging year since the Great Recession for many in the casual industry. Jessica Salisbury is CEO and creative director at Village Green in Rockford, Illinois. Her summation of the year in casual was echoed by many of those interviewed by Hearth & Home. “We ended up being up,” she said about the company’s sales volume. “But I was worried.” Her outlook for the election year of 2020 also touched on a common theme. “I don’t trust the economics next year,” she said. “I don’t have a good feeling.” Then, reconsidering, she modified her stance. “I’m feeling OK,” she concluded. The uncertainty in Rockford continues. Hers is an outlook shared by most of those interviewed. A handful were bullish in their projections for the year ahead; a minority expect sales to decline in 2020. But most expect business to settle down and be OK, perhaps even good. And that, after a year that was unsettling for many, is a welcome prospect.
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| Patio Sales: Past & Future |
The Catherine Collection by Kingsley Bate.
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Most manufacturers interviewed confirmed that the uptick in summertime sales rolled into autumn. Woodard’s furniture sales during the season were slightly ahead of 2018’s numbers. “We’re still seeing some good things,” said Bill Herren, Woodard’s creative director. (For purposes of this story, we’re looking at calendar year 2019 while acknowledging that manufacturers generally think of mid-summer and the Preview Show as the launch of a sales year. Complicating matters is how each company defines its fiscal year. Woodard’s fiscal year, for instance, runs from March through February.) Kate Carret, CEO of Za cB ryant Seaside Casual, said sales exceeded 2018 levels by a “lower single-digit number.” However, she was happy with what she described as a slim improvement. She attributed the slight decline in sales in the Northeast to the weather. Ka t
Fortunately, the season’s unpredictability began to favor many retailers and sales toward mid-summer. Casual furniture shoppers continued to visit stores and make purchases in greater numbers than usual, even after the July 4 holiday and approach of August. “Once the season started, it was a different story,” Moriarty said. “We saw strong seasonal demand, and we saw it extend later in the year.” “July, August and September’s numbers were all record breakers,” Salisbury said. That sales were up with uncomfortably high temperatures was especially unusual. Telescope Casual Furniture saw sales improve by double digits in residential as well as contract, said CEO Kathy Juckett. After two years of meager growth, the healthy increase was especially welcome. “Telescope had an excellent year,” she said. “We beat expectations.” Lane Venture had “an outstanding year,” said president Zac Bryant. The company, purchased two years ago by Bassett Furniture, is still rebuilding and “getting our legs back under us,” he said. Sales this year were up by double digits.
Ebel’s sales will probably wind up “maybe a skosh over last year,” Bottemiller said. “It certainly hasn’t been a barnburner.” Specialty retailer Debbie Stegman, with three Elegant Outdoor Living stores on Florida’s Gulf Coast, reported “a fabulous season.” February’s sales were off, perhaps because of “red tide” conditions that tend to discourage tourism. Once the water cleared, sales resumed at a brisk pace. “We were real clean when we went to Market,” Stegman said. “I have no complaints whatsoever.” Stegman noted that the economy in her market is strong and that “people are just spending.” No one interviewed, in fact, had any complaints about the state of the economy as it relates to sales. Unemployment continues at record lows, leading to grumbles from retailers as well as manufacturers that jobs making and selling casual furniture are hard to fill. The fiscal year at Sunnyland Outdoor Living in Dallas ends September 30, said David Schweig, president. The past year was “a decent year” that began poorly in the fall of 2018. “We played catch-up the whole year,” he said. The economy’s continuing resilience is a concern for some. “We’ve gone through three difficult years on the political front, and yet the economy continues to hang in there,” said Gary McCray, president of Klaussner Outdoor. “How much longer is the American consumer going to carry the economy?” That’s a particular worry, McCray said, because casual furniture is “a product that you want, but you don’t absolutely need.” Tariff Impact The Trump administration’s imposition of tariffs on a long list of goods manufactured in China and imported to the United States caused much of the uncertainty that affected the casual furniture industry in 2019. Manufacturers had lots of warning about the initial 10% tariff that went into effect January 1. Many were able to absorb the additional cost without passing it along to retailers. Others figured out how to make adjustments that minimized the impact at retail.
The Cyprus Collection by NorthCape.
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But now that the tariff has stabilized at Another factor mitigating the impact of 25%, things are looking up for NorthCape. the tariffs is NorthCape’s reliance on U.S. Early-buy orders for 2020 were up sources for its cushions. Cushions are a almost 300% over last year, he major expense, and the impact of the tariff said. The downside of “a big spike is reduced significantly when cushions are in revenue” from early-buys is removed from the import equation. “Not the challenge of making and every manufacturer that I compete with can shipping huge quantities of do that,” Murray said. product on time. The changing manufacturing environNorthCape has taken ment in China, not necessarily tariffs, led steps to reduce the impact Summer Classics to begin shifting much of tariffs by shifting of its manufacturing business from China production of high-volume to Indonesia. President Bew White said orders on popular woven the company is “slowly ramping down” products from China to Vietnam. production in China, and that about half The company began to explore making of its goods will come out of Indonesia products in Vietnam five years ago, Murray in 2020. said. The original plan was to shift about The first containers of Indonesian30% of its production to Vietnam, with made Summer Classics products shipped the balance remaining in China in October. and Indonesia. He now thinks White said its existing that as much as 50% of partner that manufactures production may come from teak products, and a Vietnam. second factory that Initially, Murray said, produces goods for the company opted the Gabby brand, will to seek alternatives to take over production Chinese manufacturing previously sourced in because, “China was China. The factories, he Br ian getting more expensive. said, “have agreed to spend B lak eney Labor shortages were millions of dollars putting in a happening. We never planned on finishing system to our specifications, patio furniture and the woven category and hiring workers to do what we need. It’s being a big target in a trade war.” doable. It just takes time.” Te rri Le e
Uncertainty about the imposition of additional tariffs increased as the year progressed. Not knowing when and if tariffs might rise (or be removed) made pricing goods for the 2019 sales year extremely difficult. The contract market was quite wary of the impact of tariffs, which “created uncertainty throughout the entire year,” Moriarty said. Brown Jordan companies, he said, absorbed as much of the additional cost as possible “and tried to figure out how to offset it.” Agio’s strategy was to deliver as much product as possible before January 1 of this year. That was possible because of the company’s strong dependence on early-buy programs and because Agio does not deal in special orders. OW Lee traditionally sets its prices for the coming year on October 1. The threatened three-stage tariff on Chinesemade goods, to phase in at different times throughout 2019, made the usual exercise in pricing extra difficult. “That trickled down to retailers not knowing what to do,” said Terri Lee Rogers, president of OW Lee. “Usually, price increases are easy to deal with,” she said. Not so this year. Tariffs had no direct impact on Kingsley Bate, which manufactures no products in China, Blakeney said. The company’s sales were on par with 2018’s, “which was our best year on record,” he said. “The 2019 season was terrible” for NorthCape, said CEO Tom Murray. “We expected it to be terrible,” he said, because of uncertainty about the impact of looming tariffs. “People were hesitant because they didn’t know what they were going to pay, and they didn’t want to be the sucker.” Murray described the last 18 months as “the hardest in 20 years.” Once the tariff rose to 25%, in-season container orders dried up, he said. The bright spot in 2019 was that a lot of dealers sold through inventory on hand, and NorthCape drew down much of its inventory in its U.S. warehouses.
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| Patio Sales: Past & Future |
The Remy Collection from Ebel.
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The Brown Jordan family of companies is concerned a little bit about delivery” with expecting sales of residential products to be the shift of so much production to Vietnam. strong in 2020. “We’re going into next year Bottemiller said retailer early-buy feeling pretty confident,” Moriarty says. orders are not coming in at Retailer Debbie Stegman is the pace he would like. “feeling really good about 2020.” “We’re fighting for She bases much of her optimism every order we can on the strength of her late-year get,” he said. “Just business, which is the start of about everybody her season in Florida. is being real slow. When she operated There’s some real stores in Ohio before apprehension moving to Florida, about 2020.” To she said she could Ebel’s strategy to mM urray always predict the take the sting out of tariffs health of the coming was to tighten its belt and year by monitoring fall adjust prices downward for next year. sales in Florida. A good “We took a pretty significant price fall in Florida meant a reduction,” Bottemiller said, which should good year ahead in Ohio. place the company in a good “That’s the way it position if the weather and ar G was every year,” economy cooperate. she said. “Everybody’s on pins Schweig expects 2020 and needles, waiting to be strong, based on to see how that’s sales trends he observed going to play out,” this fall during the start he said. of Sunnyland’s new fiscal Gaylord, at Agio, year. October sales doubled shares that appreMi those of 2018. Special orders hension. Sales were ke Gayl are “the strongest in many years. good in 2019, he said, and ord We are feeling good,” Schweig said. played out as anticipated. Murray, at NorthCape, said he is He’s learned, however, that some “very upbeat” about 2020 but added, “I’m retailers didn’t fare as well and have unsold inventory on hand. For that reason, and because of the tariff, he’s expecting 2020’s sales to decline by as much as 15%. Large early-buys surprised Rogers at OW Lee. They have arrived earlier than usual, she said, “which helps us to have the supplies ready to go.” She’s noticed an up-tick in orders from East Coast retailers, where “people seem to be stepping up a little more and ordering larger stocking orders.” Those larger orders are important, she said, to make up for the business lost as specialty retailers continue to close their doors. Equally important is developing new channels, such as placing OW Lee products in higher-end interior furnishings stores. “I hope our specialty guys realize that we are actively trying to replace the business we lose,” Rogers said. “If we don’t, we won’t be around for the specialty guys to buy from us.” y
Looking Ahead Now that the tariffs on Chinese-made goods have topped out at 25%, the open question is how long they will remain. Herren, of Woodard, thinks the tariffs will be removed to enhance the president’s reelection chances in 2020. What’s important for the casual industry is that the tariff situation seems to have stabilized, and some degree of certainty has returned, making planning with confidence much easier. Generally, the casual industry is strong and becoming more diverse. “Everybody’s bullish on the industry,” said McCray. The casual category continues to “show stronger growth than the industry as a whole,” said Jerry Epperson, a principal with Mann, Armistead & Epperson, an investment banking and corporate advisory firm. He’s considered to be one of the few financial analysts with widely respected expertise in the furniture industry. Epperson notes that the strength of the outdoor category has compelled interior furniture makers, such as Ashley and Bernhardt, to enter the category. The confidence level in 2020’s prospects, however, varies from person to person and company to company.
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| Hearth Sales: Past & Future | The strength of the economy gives Rogers confidence going into next year. “I’m pretty optimistic,” she said. Good weather next year, “would be like a cherry on top.” Lane Venture’s Bryant expressed optimism about 2020. He said the recent purchase of Crimson Casual “will give us a huge entrée into the domestically-made aluminum category.” The addition of aluminum to Lane Venture’s core line of high-end synthetic wicker will allow the company to strengthen its position with retailers and designers, as well as with the contract market. Telescope anticipates “a very good year,” Juckett said. “We expect the economy to stay strong.” Sales of Telescope’s maintenance-free Marine Grade Polymer (MGP) resin furniture fuel much of the company’s current success. MGP products, which command high-end prices, now account for between 30% to 40% of revenues.
White of Summer Classics emphasized Dallas in late October devastated an exa similar thought: Specialty retailers tremely wealthy neighborhood. As those must “decide who they are,” he homeowners rebuild and replace said, and commit to serving lost furnishings, he expects the higher-end market if Sunnyland to capture some they are to survive (and of that business. thrive) in competition Strategically, Schweig with a growing number said, “We have a better of channels. It’s no grip on tariffs and how longer possible for a small to price things. We’re business to compete on carrying less on the floor, price for lower-end and but carrying more depth.” B ill mid-range outdoor furniture. In California, Sanicola Herren Even though manufacturers of expects 2020 sales to top this higher-end goods have been stressing year’s, which were slightly off. Bigthat message for years, and retailers such as ticket sales, in the $20,000 to $50,000 range, Stegman and Sanicola have proven that the performed well and as expected this year. But strategy works, there are still non-believers. sales to “the everyday customer” declined. “I’m seeing a lot of retailers going “We bought a lot for next year,” he said, down-market because they see it as easier,” noting that he expects to move more product Bottemiller said. “Instead of making through Outdoor Elegance’s new online $1,000 on a sale, they’re making $100. store that will launch after January 1. That’s just a road to ruin, isn’t it?” “Because I’m a stocking dealer, I’m able to offer better online pricing than Wayfair and Hayneedle,” he said. Sanicola also plans more events to bring designers into his store and educate them about his products. “I’m going to be teaching them about outdoor,” he said. A major proponent of events, he hosted his fourth ThanksGrilling extravaganza at the store in early November. The event brings in more than 500 people to see equipment and cooking demos, and get a chance to win a Big Green Egg, a Memphis pellet grill, or a Treasure Garden umbrella. The event is free, but Sanicola captures all the contact information for every attendee. McCray of Klaussner Outdoor says he is “cautiously optimistic” about the prospects for 2020. That optimism is fed by the ongoing entry of newcomers to the category and the introduction of fresh ideas and products. “The manufacturers The Charleston Sling Collection from Telescope Casual. are continuing to do some really exciting things,” he said. “Everybody is trying to do everything they can to get their share.” Juckett pointed out that Telescope’s Woodard’s Herren shares confidence In spite of rampant uncertainty in success with MGP is dependent upon in 2020, speculating that, “We should be 2019, the energy and creativity in outdoor retailers who understand the product better than last year. I’m feeling pretty lifestyle products keep this industry and are proud to offer it to customers. good about it.” “pretty much fun at this point in the “They know who they are, and they have Schweig, who opened a second game,” according to McCray. confidence in the product line,” Juckett Sunnyland Outdoor Living store in Frisco, That’s a word not heard too much said. “They’re saying, ‘We’re not ashamed north of Dallas, says he’s expecting 2020 this season, but one worth remembering, to put out this group for $4,000 or $6,000, to fare well because of the strong Texas Herren said. After all, he noted, “It’s patio because we know it’s the best.’” economy. The tornado that tore through furniture. It should be fun.”
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| Retailing |
THE COOL FACTOR Keep It Casual completely reinvented itself, and that has made all the difference. By Tom Lassiter
N
ot many casual stores keep a piano in the showroom, but perhaps they should. Live music makes those evening social events at Keep It Casual so much more appealing. Most casual furniture storeowners probably don’t keep up with the start of hunting season. The folks at Keep It Casual track hunting season like a bird dog on point. When hunters take to the field, it’s a good time to invite their spouses to come see what’s new in casual furniture, accessories, and gifts.
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Minding details such as these are part of Keep It Casual’s turn-around. Three years ago, the casual retailer in Tupelo, Mississippi, was just another runof-the-mill outdoor furniture store. Sure, it offered top brands such as Summer Classics and Lloyd Flanders, but its rented quarters in a strip mall were run down and lacked pizzazz. The atmosphere just didn’t jibe with elegant merchandise and high-touch customer service. Store owner Meredith Tollison, who grew up in the casual furniture business and who
had run the shop since it opened in 2002, knew that Keep It Casual had to change to survive. A dowdy retail environment for top-flight outdoor furniture can no longer compete in this age of e-commerce, eye-candy marketing, and ever-expanding channels for look-alike goods at cutthroat prices. Plus, Tollison was tired of the sameold same-old. Especially after surviving the Great Recession and the stressful years that followed. “There were certain moments where I said, ‘I’m going to walk out that door tonight and I’m just not coming back In what used to be a jewelry store, the Keep It Casual team treats its product lines in a similar manner; the result is an attractive and interesting display of merchandise.
PHOTOS: ©2019 AARON ADAMS. ICON SPD. WWW.ICONSPD.COM.
and clothing, he was ready for something new. “I think I’d like to give this a shot,” he recalls telling Tollison. The chance meeting of old friends was the tipping point. “Everything fell into place all at once,” Tollison recalls. She resolved “to get serious about this reinvention.” Tollison, a Georgetown graduate who spent a number of years in Boston before returning to her hometown, started searching for a smaller building that would lend itself to a more design-oriented business. As luck would have it, she didn’t have to look far. An iconic building, former home to a well-known jewelry store, came on the market. The 4,000 sq. ft., fortress-like building, with concrete walls 12 inches thick, was located within walking distance of Keep It Casual. “It’s a building I’ve always loved,” she says. Its mansard roof gave it character in a funky, 1970s way. Furthermore, it had stories to tell. There’s the hole where the bulletproof glass took a round but didn’t shatter. There’s a walk-in vault, in which the jewelry store secured its merchandise after hours. “We just needed a different environment to continue to work our magic,” Tollison says. In the former Diamond Brokers building, she found it. tomorrow.’” She pauses. “I just wasn’t having fun anymore.” Tollison could have closed shop and devoted herself to her other responsibilities, running the family’s commercial real estate holdings. She was contemplating her options one Friday afternoon when Bill Warren, an old family friend, stopped by. A long-time retail sales pro, wellconnected throughout the community, Warren mentioned that he was thinking of taking a job with another Tupelo store. Tollison’s next words surprised her and Warren. “Why don’t you come manage my store?” she asked. An awkward pause followed. The friends decided to talk again after the weekend. Warren returned to announce his decision. Sales is sales, he said. Even though his background was in giftware
(L to R) Bill Warren, Meredith Tollison, and Eric Wright.
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| Retailing | A Space Transformed
Rob Robinson, the Summer Classics sales representative for Keep It Casual, watched as the store downsized, refocused, and honed its edge. The relocated store, “totally transformed,” opened in spring 2017. The shop had to close for only a week while making the move. “The way it’s merchandised is one of the best I’ve seen in the industry,” Robinson says. “It looks like one of the Summer Classics stores, but even better.” Generous use of throw pillows creates the ambiance of a boutiquey, upscale, interior furnishings store. Glass showcase counters, a holdover from the building’s days as a diamond store, appropriately display arty giftware. Big mirrors, mounted on the wall at an angle, another holdover from the past, reflect light and color to jazz up the environment. The drop ceiling was removed before the overhead structure was sprayed with a matte black finish. Underfoot, the “lovely malachite and burnt orange carpet” was pulled up to expose the concrete slab floor. Tollison had the gunk sanded off and left the imperfections before applying sealer for a “casual, industrial feel.” Guests walk into an entrance foyer with
Proof, if it’s needed, of the store’s success is that it now draws from a radius of 150 miles.
a trickling fountain and burning candles. “All your senses are touched,” Tollison says. Summer Classics seating with pink flamingo cushions provided the initial “wow” factor on a hot fall afternoon. Elsewhere guests see deep seating cushions with a bold, contrasting welt. Keep It Casual presents its fashion-forward products confidently and by design.
“For so long,” Tollison says, “we felt like we just had to be safe. We stocked brown frames with beige cushions and fabulous throw pillows. And that worked. But something as simple as a wacky, contrast welt makes a statement. “Sometimes people feel like they need permission to do something different like that. They need some sort of validation that it’s OK to step outside of that beige and brown and gray box.” All the casual furniture is displayed in vignettes, but you’ll not find any vignette restricted to a single collection or manufacturer. The presentation is eclectic, with each item selected because it pairs well with its neighbors. It’s a curated, designerlike approach. The mix-and-match strategy is to generate special orders, and it works. Tollison estimates that special orders account for about 70% of sales. Tupelo has responded well to the reimagined Keep It Casual. “Their numbers are going through the roof,” Robinson says. “From a sales perspective, they are on fire.” Broad Reach
Everywhere the eye goes, there’s something unique, something colorful, something interesting.
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Tupelo, in addition to being the hometown of Elvis Presley, is known as a furnituremanufacturing center and for its regional furniture market. The population, however, is less than 40,000 – meaning that Keep It Casual must look to a broader base.
The shop has developed that market by strong word-of-mouth references, and advertising in high-end regional and statewide magazines. “We have customers that come a long way,” Tollison says. “I’d say we easily draw from a 150-mile radius.” Within that market, which ranges from deep into Alabama in the east to Memphis and the Mississippi Delta in the west, she says, “We have a lot of folks who have the available income to get what they want.” Keep It Casual does tons of repeat business. A customer’s first purchase may be for a primary residence. Then they come back to furnish the Outdoor Room at their 5,000 sq. ft. lakefront cottage or condo on the sparkling beaches of Florida’s Panhandle. Keep It Casual also has outfitted more than a few football condos in Oxford, home of Ole Miss. Another reason for the shop’s success: The staff of Keep It Casual never miss an opportunity to reach out, embrace, and honor Tupelo. Warren calls it “maintaining a presence.” Between himself, Tollison, and longtime right-hand sales colleague Eric Wright, he says, “I think one of us is in every club in town.” They go to arts events and Chamber of Commerce meetings, and never miss an opportunity to “keep a finger on the pulse and be the first one to slide a card in someone’s hand at Rotary.” Example: Warren met a woman at a garden club event who had him make a pre-sale design visit to her home in Oxford, some 40 miles away. That led to a chance meeting with a neighbor, who became a customer. When that sale was delivered, the scenario repeated itself. “So we got three addresses, on the same street, just by schmoozing,” Warren says. Warren occasionally adds an extra piece or two of furniture onto the truck when making a delivery. The point, he explains, is to “just throw it out there” so the customer can see how it works. “A lot of times,” he says, “they don’t know they need it. I do.” Tollison’s makeover vision for Keep It Casual was to position it as a warm, welcoming place for locals to drop by and socialize. They do. “We have a good time here,” Warren says. “We cut up.” On Saturday mornings, the store’s small service
There’s really a good amount of casual furniture in the store, but it has been blended beautifully with lanterns, pillows, rugs, statues, dried flowers, mirrors, trays, and much more.
kitchen always has coffee and pastries and juice. Jazz plays on the sound system. “We have people that just come to see us,” Warren says. “But I always find a way to get something in their bag before they leave.” The shop has regular evening events, “little get-togethers,” Warren says, with hors d’oeuvres and punch, especially as the Christmas shopping season approaches. Other stores in the neighborhood also take part. The evening gatherings are “highly anticipated,” Warren says. “A lot of people come and do their Christmas shopping. We’ve got boutique lines of candles, lighting, lots of quirky gifts. So far, we’ve been really successful.” The staff at Keep It Casual know their customers’ purchase history as well as they know the individuals. When Warren and Tollison attend Casual Market Chicago, they’ve been known to see a new product and instantly think of someone who might like it. Warren might even take a photo and send it. “That goes a long way,” he says, “letting someone know you’re thinking about them.” When the team at Keep It Casual can’t remember exactly what a customer purchased, the shop’s computer system can.
“Our system keeps up with the collections you buy, and your fabrics and finishes,” Wright says. “If you need a spring replacement or a foot cap, I can look up all the way from the very beginning of when we opened and get replacement parts.” The Keep It Casual team understands that customers who purchase its highquality outdoor furniture won’t need to replace it anytime soon. To keep them coming back, the shop keeps things fresh and exciting with accessories, much as an interior furnishings store might. Warren ticks off the possibilities like an auctioneer. “There’s always going to be accessories,” he explains. Outdoor clocks. Outdoor TVs, which require outdoor consoles. Lighting. Tables. Fire pits. Even diffusers that spritz essential oils to repel mosquitos with non-toxic vapors. “We sell it over and over and over again, by the case,” he says. The reinvention of Keep It Casual, Tollison says, is a never-ending process. She had a vision of “what I wanted the business to be like … a feel, even more so than a look … and then translating that into something my employees could understand and maintain.” Some of the ideas she had simply didn’t work. She thought the store’s walls would
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| Retailing | be good to hang colorful outdoor art. But driving nails into the concrete walls to hang the art wasn’t so practical, nixing that idea. Tollison initially thought she’d remove the store’s angled mirrors, only to find out she would have to destroy them to move them. “And,” she notes, “I’m entirely too superstitious to take a sledge hammer to mirrors. So we left them. Some things we decided to live with, and ended up loving.” A Good Move
Tollison depends on part-timers (usually college students) to handle receiving and deliveries, which allows Warren and Wright to concentrate on taking care of customers.
Store Name: Keep It Casual Address: 106 South Industrial Rd. Tupelo, MS 38801 Owner: Meredith Deas Tollison Year Established: 2002 Website: www.KeepItCasual.com Email: customerservice@keepitcasual.com Phone: (662) 840-6145 Number of Stores: One Number of Employees: Full-time: 2 Part-time: 4
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Warren also drives the shop’s social media efforts, primarily on Facebook and Instagram. He understands the best times of day to make a post to fit the rhythms of people’s lives. He’s been known to post a photo that only shows a portion of an item, challenging viewers to guess what it might be. He understands the power of a tease. “It’s a good way to cast one stone and make a lot of ripples,” he says. “If you’ll stay excited and convey that to your customer, they’ll get excited.” Keep It Casual naturally staged a big grand opening event at its new location. Representatives of the Chamber of Commerce came, along with elected
Sq. Ft. of Building Space: Showroom – 4,200 Offsite Storage – 1,000 Lines Carried: Patio – Summer Classics, Lloyd Flanders, OW Lee, Hanamint, Woodard, Lane Venture, Homecrest, Kingsley Bate, KNF-Neille Olson, Oxford Garden, Seaside Casual, Breezesta, Watermark Living, Three Birds Casual.
officials and the press. Tollison invited the former owner of the building and his family. She also reached out to about 50 of the store’s best customers with a postcard invitation and followed that up with a personal phone call. Perhaps the most important person attending was her father, Bill Deas. Her dad is well known in the casual industry as the man behind Casual Furnishings International, initially the less-thantruckload distributor for products imported by Erwin & Sons. Decades ago he had a patio store in Tupelo called Patio Place, as well as other retail furniture interests. Tollison was managing the wholesale business with her dad in 2002 when he said, “We need to open an outdoor store. … Oh, and you’re going to run it.” Tollison now says she had “no intention of doing” that, but she did. Her dad introduced her to the industry and executives with whom she’s built decades-long business relationships and friendships. At Casual Market Chicago, they ask about her father and even her dog. Much like Keep It Casual’s carefully nurtured relationships with its customers, the casual industry remains relationship oriented in an era when most business is merely transactional. “To feel like the owners of these phenomenal companies are accessible and they know me and they care, that’s significant,” she says. Tollison empathizes with the adult offspring of successful retailers who are reluctant to take over the family business. She had been that way herself at one time. It was like being handed the torch, she says, “and I felt obligated to take it. Now I’m glad I did. It’s been an incredible experience, quite bumpy at times. “But now I feel like I’ve taken it and made it into what I’ve wanted it to be for quite some years. I think we’re doing something really cool.”
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| Wellness |
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WEALTH
DEPENDS ON HEALTH You take good care of your business, but are you taking good care of yourself? By Mark Brock
O
wners and managers of specialty retail companies are, first and foremost, focused on taking care of the business – growing revenues, enhancing profits, and providing customers with quality products and exemplary service. It’s demanding work that requires a total commitment that can come at a cost – the wellbeing of those taking care of the business. The irony of placing the health of the business over personal wellbeing is that healthier owners and managers have greatly improved odds of creating successful businesses. The clear-headed thinking and increased energy that come with a healthy mind and body can be one of the most important factors for ensuring success. “The health of any business is tied to the health of the bodies and the minds of the owners and managers,” said Peggy Hall, a nationally recognized authority on wellness and weight loss. “It’s essential to realize that taking time for yourself is not selfish – it’s actually ‘self-less’ in that you need to take time to restore your energy, replenish your creative ideas, and refresh your mind on activities outside of business. “Running yourself ragged is only going to hurt your business performance,” she continued. “Gone are the days that saying ‘I’m busy’ is a badge of honor. Wealth depends on health. A healthy business owner or manager will have the physical energy, mental faculty, and emotional well-being needed to weather the stormy seas of business.” We recently reached out to Hall, other wellness experts, and specialty retailers to gain insights into the essentials for ensuring an enhanced state of wellness and a more successful business. Here are 12 essentials that we gleaned from those conversations.
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Know That You Are What You Eat
Keep Your Body Hydrated
Food and beverage are the fuels for the human machine and if you want high-octane performance you have to use high-octane fuels. Who doesn’t know that you need to eat more fruits and vegetables, and that you should avoid processed and fast foods and sugary sodas? Portion control is also essential to weight management as metabolisms slow with age, meaning that the same number of calories at age 20 won’t be ideal at age 50 and older. Also part of these recommendations are guidelines for alcohol consumption, with no more than two drinks per day for men and one for women, for those who imbibe at all. “Good nutrition is fundamental to health in general, and it spills over into all parts of life, not just physical but also mental and emotional. With good nutrition, you feel better and you’re in a stronger position to deal with stress. For anyone who wonders what they should be eating, I suggest they just go to the produce section of their grocery store and look around. “In terms of portion control, I suggest people look at their dinner plate and allocate half to non-starchy vegetables, one quarter to a good starch such as sweet potatoes, whole wheat bread or brown rice, and one quarter to a lean protein. It’s a pretty easy approach to ensure you are eating a healthy meal.”
Closely associated with good diets is the need for good hydration. By the time you feel thirsty, you’re probably dehydrated. Taking in copious amounts of water throughout the day, particularly in brutal summer heat, is a great idea. Dehydration leads to fatigue, poor digestion, and lack of energy. An age-old recommendation is eight glasses of water per day, which may be more than enough, but you get the idea. “Research shows on average people are not consuming enough water. It’s just something that many people are not good at. Good hydration can drastically affect the way you feel, your quality of sleep, and make you more mentally alert; there is a whole cascade of positive effects. Another good thing about hydration is if you drink enough water you can avoid sugary drinks that contribute to weight gain. Water is the best hydration, and it’s free.”
– Ethan Dixon, MPH, RD, LD, wellness dietitian and home chef, Houston, Texas
– Ethan Dixon, MPH, RD, LD, wellness dietitian and home chef, Houston, Texas
Exercise on a Regular Basis If you’re like many specialty retailers you probably think you get plenty of exercise working on the showroom floor, in the warehouse, or at customer locations. Any activity that gets you out of a chair and moving around is a good thing, but for exercise to contribute to a healthier you – physically and mentally – it should be aerobic – get you breathing more and your heart rate up. When it comes to exercise, consistency is as important as intensity. A 30-minute walk three days a week is a good goal, if your doctor approves. When you go on a walk, leave the smartphone at home. “My wife and I ran together when we were dating, and we continue to enjoy running several times a week. I’m not hard-core about it; I don’t do marathons, but if I miss a day of running, it has an effect on me. I’m also in the weight room a few times a week and have been since high school. Exercise is really therapeutic for me, it clears my mind and it helps me make better decisions.” – Jon Chapman, CEO, Rich’s for the Home, Seattle, Washington
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Address Medical Needs
Disconnect From Electronics
When was the last time you had a check-up? Do you have a relationship with a primary care provider who is tracking your health as you age? Do you have any medical conditions, such as high blood pressure, that require on-going management? No one likes going to the doctor, but addressing medical needs ongoing and early can avoid more serious and more expensive intervention later on. Avoid the 3Ds of addressing medical needs – delay, denial, and distraction. “If you have a chronic medical condition, don’t put off getting care ‘until things slow down.’ See your doctor when you’re due, get tested on schedule, and set up a medication reminder system that works. Annual physicals are definitely a good idea because they can detect issues in the early stages before they become real problems. Prostate screening for men and mammograms for women should be done as we get older.”
Smartphones and laptops are wonderful devices for helping to manage a business, but they are also a threat to your wellbeing. It takes real discipline to turn off that phone at the end of the day, while exercising or while on vacation, but you’ll be better off for it. It’s all about setting limits of when you will be available; you may be surprised that you can get back to a needy employee or a pesky customer at a later hour and no one is worse for wear. “I know how hard it is to be pulled in a million directions with the demands of running a business, but over the last five years I’ve been able to develop intentional habits that have made my work a joy and been a blessing to my family and my health as well. Technology offers so many benefits for a business, allowing us to accomplish more and to be more effective. But when I’m engaged in family time, I make it a point to stay disconnected from electronic devices.”
– Teri Dreher, RN, CCRN, iRNPA, Board Certified Patient Advocate, Owner/CEO, NShore Patient Advocates, Chicago, Illinois
– Tim Reed, Retail Team Leader, Fireside Home Solutions, Portland, Oregon
Get a Good Night’s Sleep
Have Some Fun with Work
It seems that a great number of Americans suffer from insomnia these days, and that’s a bad thing. Lack of sleep has been associated with a number of physical and emotional ailments. If you have a serious sleep deficit, you may want to check in with a sleep specialist. But first review your sleep hygiene and see if you can get more and better shut eye. No caffeine or alcohol a few hours before bedtime. Go to bed and rise each day at the same time, even on days off. Limit bedroom activities to sleep and intimate relationships. “It’s important to go to bed at a reasonable hour, get up relatively early, and stick to this routine. Some studies correlate waking up early with success. Lack of sleep creates lack of focus, and if you get drowsy every day at 3pm, your body is telling you something. Sleep is like water and exercise, and you should be very intentional about it.”
Work is work and fun is fun, but the twain can meet. There’s no reason that work has to be completely serious all the time. A fun outing with your employees or a creative promotional event is good for business and good for you. It’s tough not to take things seriously all the time, and no one says you have to be the life of the party every day, but taking a step back to laugh at yourself and the absurdity of life might be well worth the effort. “I do have fun with the business because if you enjoy what you do you never work a day in your life. I have always thought of our business like a car – my foot is on the accelerator and my wife (Diane) has her foot on the brake, and we both have our hands on the steering wheel so we have to negotiate where we’re going to steer this thing.”
– Teri Dreher, RN, CCRN, iRNPA, Board Certified Patient Advocate, Owner/CEO, NShore Patient Advocates, Chicago, Illinois
– John Bassemier, Founder and Chairman, Bassemier’s Fireplace, Patio and Spas, Evansville, Indiana
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Connect With Positive People
Get Involved with Your Community
We often think of peer pressure as affecting young people, but in fact, those with whom we associate affect us throughout our entire lives. For a healthier life, seek out people – both at work and outside of work – who have a positive outlook, offer creative thinking, and effective problem solving. These are people you might want to hire and people you want to regularly seek out for a coffee break or lunch to share ideas and get recharged. It’s another commitment in time, but well worth the battery boost we get from being around people who see life as a series of problemsolving events that they relish taking on. “When we are anxious, overwhelmed, or depressed, we often seek to isolate ourselves when the reality is that being in community with others is the antidote to those feelings. Networking with like-minded people, even from different industries, can be a lifesaver when you realize you’re not in it alone. Outside interests are also essential for refreshment, a new outlook, and excitement to go back to work with ideas gleaned from outside your industry. “Finally, smart business owners get help in their business, so why not seek expert assistance in your life? Life coaches can help you identify areas where you feel stuck and assist you in creating concrete steps for moving forward.”
There are many benefits to your health and to your business from being involved with organizations and activities outside of work. Taking time away from the business to volunteer can be a source of exercise, while creating a sense of satisfaction that comes from helping others. Not coincidentally, forming relationships in the community can also translate into new customers. “Raising our two girls kept my husband, Steve, and me active and also got us involved in the community. The girls wanted to play soccer and Steve got involved as a referee, and they also got into skiing, that led us to volunteer for the ski patrol. Sailing, skiing, soccer – we made time for these things because we wanted these experiences for our girls and we found time after work. Getting involved in the community was just another benefit for us, for our girls, and for the business.”
– Peggy Hall, nationally recognized wellness and weight loss expert, author and speaker, Aliso Viejo, California
– Karin Pierce, co-owner Stove & Fireplace Works, Ashland, Wisconsin
Hire the Right People The single most important step toward a healthier owner or manager is hiring the right people. When you select associates who fit into your company’s culture and who are dedicated to your success, you have just taken a giant step toward a healthier life. These types of employees can assume increasingly responsible roles, relieving their employers of work-related stress and opening up opportunities to take time away from the business for exercise, vacation, relaxation, and creative thinking. Of course, it’s a two-way street, and owners and managers must not only select the right people but provide them with competitive pay and benefits, and offer authority to make decisions as they gain knowledge and experience. “When my husband and I first started the business it was just the two of us, which made it tough to get away. As we grew the business we were able to add employees that allowed us more flexibility in taking time off. It’s a challenge to find just the right people because you have to have people who can work in the field for installations, and people who can work with customers in the showroom. “This (hearth) is a highly technical field and it’s not something you can learn in a year. The best advice I heard concerning hiring was the idea that you should hire people who have the potential to start a business that could compete with you. Those are the people who can be really valuable to your company.” – Karin Pierce, co-owner Stove & Fireplace Works, Ashland, Wisconsin
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Find Ways to Relieve Stress
Establish Work-life Harmony
Stress is built into the human DNA, starting with cave dwellers who had to escape large hairy animals. With wooly mammoths now extinct, stress comes at us from all directions at home, at work, and even in traffic. It’s essential to find ways to manage stress, to release the pressure valve, whether through exercise, meditation, or prayer – just some time reserved to get away from it all and breathe deeply. “Running a small business is very stressful at times and you have to find a release, a way to put that stress aside. When I go for a bike ride of 80 or 100 kilometers, all I think about is my bike and the wheel of the bike ahead of me. When I get home, all of the stress that I’ve been feeling at work has left me. Riding a bike is a great stress release in addition to the physical benefits.”
One of the common prescripts for a healthier life is to create work-life balance. It’s as if you can draw a line in the sand with your work on one side and your personal life on the other. In reality, your work life and your personal life are inextricably intertwined, and rather than thinking of balance between the two, perhaps you should think of creating harmony. “Work-life harmony can be different for everyone. For me, I take a step back and consider what my goals are for the business and what my goals are for my family, and how I can structure my calendar to harmonize all those priorities. “I want to be the best dad possible for my kids, and I want to be an effective leader for our teams at work. Achieving those goals actually overlap and I find that the experiences in one area carry over into the other. When you think in terms of work-life balance you set yourself up with competing priorities. When you think of work-life harmony, you have a better chance to be successful at both.”
– Bill Harvie, co-owner, Valley Stove & Cycle, Kentville, Nova Scotia
– Tim Reed, Retail Team Leader, Fireside Home Solutions, Portland, Oregon
Profiles in Wellness We reached out to wellness experts, specialty retailers, small business owners, and managers for their perspectives on the topic of wellness. The following are their stories: Why Climb Every Mountain? There Is a Very Good Answer As a high school student, Bob Ferrari is the first to admit he was a disaster, but all of that changed at summer camp. At the age of 16, he discovered rock climbing and so began a lifetime pursuit of mountain climbing that has contributed to a fulfilling life and successful businesses – White Glove Chimney and Duct, and White Glove’s House of Fire of Redding and Chico, California. The company traces its roots to 1977. Because of his business success, Ferrari has been able to pursue his other great passions in life – international travel and mountain climbing. He and his wife, Marina, have traveled in Russia, Central Asia, Georgia in Eastern Europe, Turkey, Italy, Switzerland, England, and Scotland. While sightseeing has been a big part of these trips, it’s also been about mountain climbing.
Ferrari has scaled peaks in Central Asia, Alaska, the Alps, Turkey, and Georgia. He has climbed Mount Shasta, which is near his home, more than 40 times in all seasons, and he’s working on organizing a climbing expedition in 2020 for mount Aconcagua, which is located in Argentina with the highest elevation in the southern and western hemispheres. Mountain climbing, along with other activities such as skiing and mountain biking, have kept Ferrari fit at the age of 68. He concedes there is no good answer for why someone would want to climb a mountain other than feeding a desire for new and challenging experiences. “We have an exercise that we sponsor with our employees each year in which everyone describes their perfect life,” he said. “It’s a hard exercise, but it really helped me focus on what I really want to do, which is to have a successful business that allows me to travel and climb mountains.” Ferrari finds there are many aspects of mountain climbing that make him a better business owner. “When you’re climbing a mountain, just like in business, there is an intense
determination about it and you don’t want to make any mistakes. You are on a rope line with other people, so everyone is in it together, and you have this sense of community. We all depend on each other for survival. You’ve got to be smart and you’ve got to know that, perhaps, you can’t make the summit today, but there’s always another day.” Ferrari is a firm believer that fitness comes with following your passion, and staying active is essential for success in business. “If you’re not healthy, if you aren’t fit, your business will suffer. We want all of our people at White Glove to have a sense of wellbeing, and that carries over into how we serve our customers. Our focus is on providing families with fireplaces where they can enjoy being with each other and know that they’re going to be warm and safe.” Stoves and Bicycles – An Unlikely Yet Successful Match If you had to think of two things that have virtually nothing in common, you couldn’t do better than stoves and bicycles. But for Valley Stove & Cycle in Kentville,
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| Wellness | Nova Scotia, it’s proven to be a successful combination not only as a business but also as a source for wellness. Valley Stove opened for business in the Annapolis Valley of Nova Scotia in 1977 and, in the early 1980s and at the urging of an employee, began also to offer bicycles. It was a relatively easy diversification because the company’s stove distributor also carried a line of bikes. From one line of bikes, the company has grown steadily until it’s a leader in both heating appliances and human-powered transportation. “It’s an odd marriage, and the only logical connection between stoves and bikes is how they offset each other seasonally,” said Bill Harvie, co-owner. “When it’s too cold to ride a bike, we focus on stoves.” Collateral benefits from the bike business are many for Valley Stove & Cycle. Harvie and the company’s employees are avid bike riders, that keeps them in great shape and helps to manage stress. Additionally, the company sponsors weekly group bike rides that provide invaluable networking within the local community. Valley Stove & Cycle is located about an hour from Halifax in the Annapolis Valley which offers beautiful rolling terrain featuring farming, fishing, and coastal views. It’s an ideal setting for both street and mountain biking. “Good health and a healthy business go hand-in-hand,” Harvie said. “When
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your people are fit, full of energy, and enthusiastic they make good salespeople. By riding together we not only have fun, but we also build relationships with each other and that makes for a great team.” Wellness Begins with Good Nutrition As a wellness dietitian and home chef, Ethan Dixon is a firm believer that wellness begins with good nutrition. After all, as the cliché goes, we are what we eat. “Good nutritional habits really begin with motivation,” he said. “It’s easy for someone to go with processed or fast foods if those foods are convenient. For good nutrition, however, we have to find motivations other than convenience. I work with people to pursue positive motivators such as increased energy, weight loss, and just feeling better overall.” Dixon’s approach to helping people improve their nutrition incorporates accountability through family and friends, or by working with a professional dietician such as himself. Fad diets are typically not effective, which makes foundational aspects, such as a support system, essential to good nutrition. He also recommends multivitamins as supplements to healthy diets. “A mantra of mine is that many small changes can add up to one big change,” he said. “If a person can eliminate sugary sodas, then that’s 500 calories eliminated
per soda, and over time that contributes to a healthier life.” With obesity at epidemic proportions in America, a central focus for dieticians such as Dixon is on weight control. “I often focus on the timing of when a person consumes a meal,” he said. “Rather than just grabbing fast food when it’s convenient, it’s much better for a person to stick to a food schedule that is structured with nutrition and creates accountability for time and place and moderation.” Work sites can also play an important role in good nutrition, according to Dixon. “When you celebrate a birthday or other special occasion at work, in addition to cake or pizza, why not also have a healthy choice?” he said. “Employers can also provide water jugs or bottles for employees, and establish some sort of exercise or walking program. It’s important that everyone get moving throughout the day.” Bringing Fun Into Work Is Healthier for Everyone When it comes to adding a touch of fun to the workplace for a healthier lifestyle, John Bassemier could have written the book. As the founder of Bassemier’s Fireplace, Patio and Spas in Evansville, Indiana, more than 50 years ago, he has built a successful business that often incorporates whimsy bordering on outlandish to grow the business and add fun to the work. By way of example, Bassemier was intrigued by the idea of building and racing paddleboats, and with the help of close friends and associates, built and raced the world’s fastest paddleboat, clocking a record setting 52 miles per hour. He raced through the Midwest, attracting media attention for his business and having a whale of a good time. “The essential in promotions is that you not only attract attention to yourself, but you get media coverage for your business as well,” he said. “That’s what I’ve focused on over the years.” Creative promotional events that add whimsy to the serious business of fireplaces and spas included cutting a spa in half and placing it in front of the store to highlight a half-price sale. There was also the “Recycle Your Backyard” event when local residents were invited to bring in propane tanks for recycling, along with abandoned swing sets
and decrepit patio furniture. On a more serious note, the business has also sponsored safety seminars. While these promotional events have been a secret to his success, Bassemier is quick to acknowledge the support and understanding from his wife, Diane, and the support of their two sons, James and Jeff, who are taking over the business. “I have had fun with the business and always looked for new ideas,” he said. “I’ve been a magnet for information; I try to learn all the time, and I’ve been willing to take some risks. I learned that if you have the survivor gene like I do, then you take risks and you’ve got a fighting chance to be OK.” Intentional Approach Key to Balancing Work and Family As CEO of Rich’s for the Home, Jon Chapman is responsible for the operation of five super stores in and around Seattle, Washington, selling fireplaces, stoves, hot tubs, grills, and outdoor furniture. It’s a job with significant responsibilities, including carrying forward the heritage of his father, Larry, who founded the business in 1979. “Consistent exercise is an essential part of being healthy, and it keeps me sharper so that my mind is clear for the important decisions we have to make,” he said. “After Christmas each year, the gym is packed with people trying to get back into shape, but by February they are all gone. I see this every year. To add exercise to your lifestyle, you have to push through getting started, and then the key is consistency.” Just as Chapman is disciplined in how he manages the business, he is equally disciplined in his approach to wellness – running regularly with his wife, healthy diet, outdoor activities with his family, and a consistent sleep pattern. “I focus on keeping a good balance between my work and my family,” he said. “My work week is pretty consistent and that helps to keep the stress level down. Managing stress is a huge component to health, and consistent exercise and a regular work schedule are great ways to help control it.” Rich’s for the Home also encourages healthy lifestyles, with associates encouraged to make self-care a priority and to keep stress levels at manageable levels.
“The primary benefit of a healthy lifestyle is how it helps me make better decisions,” he said. “When my mind is clear because I’ve exercised, gotten a good night’s sleep, eaten a healthy meal, had time with my family, I know I can make better decisions.” Children Offer Opportunity for Active Lifestyles As new business owners, Karin and Steve Pierce found the demands of the business took priority over just about everything else, other than nurturing their two girls. It was raising a family that helped to keep the couple active and well during the early years of founding and growing Stove & Fireplace Works in Ashland, Wisconsin.
“For small business owners, it’s hard to take care of yourself, but we live near Lake Superior and we always wanted to be involved with our girls,” Karin said. “Steve bought a sailboat, and after work during the summer, we would go sailing with the kids, or swimming, or spending time on the beach. During the winter, we would all go skiing because there are ski areas near where we live. When the girls became involved with soccer, Steve became a referee. By staying involved with our girls, we kept ourselves fit, active, and involved in the community around us.”
By remaining fit and active, the Pierces were able to do a better job of growing their business, according to Karin. “When you’re active and fit, I believe you are less likely to burn out,” she said. “Every business has issues with customers from time to time, but when you’re healthy, you’re better able to be patient and work things out.” Motorcycle Racing Offers Ultimate in Stress Relief While some people turn to yoga or jogging for stress relieve, Lynn Meyer, owner of American Home Fireplace & Patio in West Salem, Wisconsin, has his own special approach – motocross racing.
“Every small business owner needs a stress release, something to help deal with the pressures of working with consumers day in and day out. As a business owner you don’t go home and forget about customers and how the job went; you are always thinking about it,” he said. “An outlet is a way to relax and refresh your mind and take a break from the business so you can keep your sanity. I race motorcycles – that’s my release.” Meyer and his wife, Raenel, began the business more than 30 years ago, starting out in his grandmother’s chicken coop – an 800 sq. ft. space that they renovated
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| Wellness | for their fireplace business. The company has grown steadily over the years and today occupies more than 10,000 sq. ft. of warehouse and showroom. Meyer began racing motorcycles in the 1970s, dropped out in the 1980s to focus on the business, and got back into the sport in 1995. He’s won numerous district and state-level championships, and regularly practices on a 1.1 mile motocross track he built on his 20-acre home site. “Competition is good as it gives you incentive to practice so you can beat your buddies. Motocross is a good physical release for me, and my mental state is much better because I get that release,” said Meyer, who is 67 years old. “When
I’m on a motorcycle, I get endorphins and adrenaline going, and I don’t have to dwell on problems. It’s a whole lot better for me than spending an evening on the couch watching TV.” Because he has a racetrack in his own backyard, Meyer finds it’s easier to make time to practice, and is regularly joined by other riders from throughout the area. His interest in motocross racing continues a lifelong focus on physical activity that’s encompassed running, biking, weightlifting, wrestling, and cutting wood. It’s all part of a commitment to a healthy way of life. “When I go to bed at night, I read for several minutes to relax my brain and that helps me get a good eight hours of sleep.”
Nursing Advocate Offers Insights Into Wellness As a critical care nurse for 30 years and currently serving as a patient advocate based in Chicago, Teri Dreher, RN (Registered Nurse), CCRN (Critical Care Registered Nurse), iRNPA (Independent Registered Nurse Patient Advocate), is well versed in the elements that contribute to a healthy lifestyle. “If you’re a hardworking small business owner, chances are you skip meals, forgo sleep, and never fully disconnect from work,” she said. “You may think it’s the key to achieving success, but as the heart and soul of your business, you’re not doing it – or yourself – any favors. A small business is only as healthy as its leader. You have an obligation to your employees, stakeholders, and loved ones to take care of your mind, body, and spirit.”
HERE ARE HER TOP RECOMMENDATIONS:
yourself with good people • Surround and delegate to them. to bed at a reasonable hour, • Go get up relatively early, and stick to
this routine.
and plan your day.
yourself a few minutes each • Give morning to reflect, get centered,
• more water because when • Drink you’re dehydrated your body has
Nourish your body. Brown-bag healthy foods and don’t skip lunch.
to work harder.
or climbing stairs.
some activity into your • Work day walking, stretching,
• When you’re getting stressed, • step outside for fresh air to clear
If you have a chronic medical condition, don’t put off getting care.
your head.
• Learn not to sweat the small stuff. Don’t let a small disappointment • derail your day. Practice • evening. disconnecting each Set a time when you’ll shut down • your devices. Make a date every month with • someone who inspires you. Be kinder everyone, • especially toyourself. 68 | DECEMBER 2019 | www.hearthandhome.com
Connections With Others Adds to Health, Success Making connections with other people who have similar challenges can be an important element for achieving a healthier lifestyle, and no one knows this better than Tim Reed, retail team leader for Fireside Home Solutions in Portland, Oregon, and Seattle, Washington. Reed hosts a podcast, “The Fire Time Podcast,” that allows him to connect with others in the industry nationwide.
recommendations for others, Reed suggests pursuing work-life harmony, disconnecting from electronic devices during family time, and intentionally scheduling workout and learning time. “I’m a runner and running has been a game changer for me,” he said. “I grab a stroller and my three-year-old and we’re off. I’m also a big believer in meditation and I’m a big fan of podcasting, which has transformed my business life in marketing and leadership. I’ve been able to make
“The truth is that most business owners in our industry are so stuck in the day-today whirlwind that they can’t break free to think about anything else,” Reed said. “This means that personal care, relationships with loved ones, and strategic thinking to grow the business all suffer because of the frantic needs of the day. Over time, this makes business owners feel discouraged and bitter when the truth is that they work too hard to be steamrolled by their own businesses.” Reed can relate to these challenges because his podcast audience often shares the same issues that he experiences as he works with associates at two locations in Portland and four in Seattle. In terms of
connections with people across the country who are facing similar challenges.” Reed is also an advocate of reserving time away of the constant demands of a job. “I actually schedule thinking time for myself. I’ll set aside an hour or two and go to a coffee shop with a notebook and think about our business. It’s been shocking how problems can be solved when you take time out.” Here’s How A Wellness Expert Takes Care of Herself Peggy Hall in Aliso Viejo, California, is a nationally recognized wellness and weight loss expert who is a regular contributor to national print and online publications and
a frequent guest speaker at seminars and on podcasts. We asked her how she takes care of herself. “My daily goals are to: (1) Nourish myself with the highest quality foods. (2) Engage in the most enjoyable physical activities. (3) Surround myself with the most positive, encouraging, and uplifting people as possible. (4) Encourage my own self with phrases such as, ‘I got this!,’ ‘I’ll handle whatever comes up!,’ ‘This could turn out to be better than expected!’ (5) Take at least one hour a day all to myself to do what I enjoy doing, guilt free. (6) Take one day a week, doing what I enjoy, away from work.” As a business owner, Hall acknowledges that it’s easy to put personal needs secondary to those of the business. To counteract this thinking, she emphasizes the connection between good health and business success, and she suggests that regular exercise, eating healthy, and self-care are not all or nothing propositions; even small steps can make a big difference. “Our existence is a blend of physical, emotional, and mental energy, and each area of our lives affects the other,” she said. “You can have all the healthy eating and exercise you wish, but if you are silently berating yourself for not being good enough, you are harming yourself. On the flip side, you can be a wizard at aspects of your business (using your mental faculties) but if you are neglecting the mental and emotional aspects of your well-being, you are not operating at peak capacity.” Hall says she has dedicated her career to wellness teaching because she knows that a better life is possible; it’s a state of being what she calls “Living Swell.” “I can’t stand to see people suffer when there is a better way,” she said. “Our society puts so much pressure on people to look a certain way, to be a certain way, to succeed in a certain way. My message to people is that they don’t have to be perfect to be a success. You cannot hate yourself into doing better. “Instead of self-loathing, I preach selfcare. Instead of self-discipline, I preach selfawareness. Instead of more goal-setting, I preach more soul-getting. In other words, take time to think about what you want out of life, how you want to feel, and what you want to experience.”
www.hearthandhome.com | DECEMBER 2019 | 69
| New Products |
Kalamazoo Outdoor Gourmet
The Acadia Series modular outdoor kitchen system includes 20 customconfigurable cabinetry components with leveling legs and a speed-clip system to facilitate installation. Four horizontal panels come in two standard finishes: oiled ipe wood or charcoal-gray, powder-coated stainless steel. Phone: (800) 868-1699 Website: www.kalamazoogourmet.com
NEW
PRODUCTS
Les Jardins Solar Lighting
The rechargeable Wharf is nautical, rustic and mesmerizing. The sculptural open frame creates an illusion of dancing light. At just under five ft. tall, the light has a cinched silhouette and entwined elements. Choose from a modern aluminum frame or all-weather wicker. Phone: (213) 745-8883 Website: www.lesjardins.com
ZEE
The eye-catching Naples fire table is made of outdoor-rated resin Balsam color wicker with a black glass top and burner cover. The aluminum frame is rustproof and an access door conceals a 20-lb. propane tank. The Glass Guard-20-R and protective cover are optional.
A hose reel needn’t be solely utilitarian. The Mirtoon hose reel is crafted for practicality as well as being visually attractive. The hose reel comes in a ‘unicolor’ look, combining the gardener’s need for a strong hose reel with a desire for outdoor beauty.
Phone: (866) 303-4028 Website: www.outdoorrooms.com
Phone: +32-496-309-313 Website: www.zee.be
The Outdoor GreatRoom Company
70 | DECEMBER 2019 | www.hearthandhome.com
iFlame
The Firebug is the smallest remote control available for millivolt fire features. Although compact in size, at roughly 1½-inches square, ½-inch thick and weighing just ½ ounce, a single coin cell battery powers the unit. It also has a built-in battery health monitor. Get the picturesque look with the versatile remote, buried or hidden in fire glass, stone, or logs for ease of accessibility and a clean appearance. Phone: (844) 352-6383 Website: www.iflame.com
European Home
Bathyscafocus is a stylish and modern fireplace with a new Focus White finish. Clad in pristine white, the fireplace brings a clean, modern look to any space. The play of light and shadow reflecting off the white surface lends the metallic body an airy lightness, transforming it into a veritable sculpture of light. Phone: (781) 324-8383 Website: www.europeanhome.com
Lloyd Flanders
The Magnolia Collection invites guests to sink into deepseating comfort. The rich colors fit seamlessly in any outdoor environment. The seat has rolling arms and intricate, attractive back weave. Included in the collection are tables and a variety of chairs and sofas. Phone: (800) 526-9894 Website: www.lloydflanders.com
Sopka
Numerous features create a retro stove with modern performance in the Rizzoli L90 wood cook stove. Details include a large combustion chamber in refractory material, radiant steel plate, fire door with hermetic seal, a stainless-steel oven, and oven door with side opening glass. Vented sides create natural thermal convection. Phone: (216) 543-7002 Website: www.sopkainc.com
Travis Industries
The 4237 Deluxe Gas Fireplace has a generous heat output with a 42-inch wide by 37-inch high glass. The fireplace has beautiful fire view, 10-piece detailed log set and a choice of clean face installation or handhammered IronWorks double doors. Phone: (800) 654-1177 Website: www.travisproducts.com
Click here for a mobile
www.hearthandhome.com DECEMBER 2019 | 71 friendly reading| experience
| New Products |
OW Lee
Blaze Outdoor Products
The 316L 4-Burner LTE is certified for multi-family dwellings, apartments and hotels. The grill is constructed of marine-grade stainless steel, and has heat zone separators, a double-lined hood and triangular cooking grids and comes in natural gas, propane, and as a cart model. Phone: (866) 976-9510 Website: www.blazegrills.com
Sophisticated Belle Vie is reminiscent of 19th-century design favored by the French aristocracy. With Art Nouveau flair, the collection includes dining, deep seating and lounge options. Cushions have Plush Comfort and Sytex Seating Systems for superior comfort. Frames are aluminum and come in a choice of 13 finishes and over 150 stock fabric options. Phone: (800) 776-9533 Website: www.owlee.com
Foss Floors
Couture premium carpet tiles are made of 100% post-consumer drinking bottles. The tiles are selfsticking; peel and press when installing to give an area a fresh, stylish look. The versatile tiles can be installed anywhere: on concrete, wood, vinyl and even carpet and are fade and stain resistant, waterproof and simple to clean. Phone: (706) 581-2582 Website: www.fossfloors.com
Kingsley Bate
Crafted from all-weather wicker and rustproof aluminum frames, the Savannah Collection is antiqued to give the appearance of authentic rattan. The collection includes a sofa, settee, lounge chair and occasional tables. Phone: (703) 361-7000 Website: www.kingsleybate.com
72 | DECEMBER 2019 | www.hearthandhome.com
Amantii
The BI-88-SLIM measures 88-inches wide and 6ž-inches deep. The fireplace offers multiple length and depth options, as well as giving the homeowner the ability to install the fireplace with a choice of finishing material built right to the glass for a clean-face design or use the provided black metal surround. Phone: (877) 850-9458 Website: www.amantii.com
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Education, Education,Networking Networking Breakouts,Roundtables, Roundtables, Breakouts, Think Tankand and FUN! FUN! Think Tank
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| Business Climate |
OCTOBER SALES
In early November, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, patio, and barbecue products, asking them to compare October 2019 sales to October 2018. The accompanying charts and selected comments are from the 209 usable returns.
RETAILER SALES - U.S. AND CANADA Ocober 2019 vs. October 2018
57% 54%
57%
51% 18%
43%
25%
24%
24% 25% 22% 0%
RETAILERS NO CHANGE
RETAILERS UP HEARTH
PATIO
RETAILERS DOWN
BARBECUE
SPAS
In October, 57% of Spa retailers were UP, 51% of Hearth retailers were Up, and only 24% of Barbecue retailers said they were UP, and 18% of Patio retailers.
13-MONTH YEAR-OVER-YEAR RETAIL SALES October 2019 vs. October 2018
PATIO
HEARTH
19%
12% 9%
5% 5%
4% 4%
1%
-2%
Oct 2018
Nov Dec
Jan Feb 2019
Mar
Apr
4%
2%
May June July
4% 5%
Aug Sept
7% 2% 2% 2%
Oct 2019
Oct 2018
Nov Dec
0% -3%
Jan Feb 2019
Mar
21%
BARBECUE
6%
3%
2%
Apr
0%
May June July
2%
5%
-4%
Aug Sept
SPAS 12%
12%
9% 9% 2% 1% 2% -2% 1% 0% 0% 0% -4% -2%
Oct 2018
Nov Dec
Jan Feb 2019
Mar
Apr
May June July
2%
5%
4%
Oct 2019
1%
-11%
-4% -1%
Aug Sept
Oct 2018
Nov Dec
Jan 2019
Mar
Apr
6%
4% -7%
May June July
3%
Aug Sept
In October, Spa retailers led the way with a 12% gain in sales, followed by Hearth retailers with 7% gain, and Patio retailers with a 5% gain. Barbecue retailers were down in sales by 1%.
74 | DECEMBER 2019 | www.hearthandhome.com
Oct 2019
Oct 2019
WEATHER REPORT RETAILER COMMENTS
For the following weather charts, the numbers for each state reflect the temperature ranking for the period since records began in 1895.
STATEWIDE AVERAGE TEMPERATURE RANKS OCTOBER 2019
NORTHEAST Delaware: (Hearth, BBQ) “This year has really been in the doldrums. Finally, a month comparable to last year’s!”
New York: (Hearth) “We are surrounded
by the Big Box stores on all sides. It gets more difficult to sell quality products at a fair price. We often get customers who have tried the Big Box stores and were not only disappointed in their quality but in the service as well. We look forward to a cool winter and the opportunity to serve.”
3
4
1
Maine: (Hearth, Patio, BBQ) “October
is a transitional weather month, and this October delivered two severe wind and rain storms within a week, cutting power to 180,000 homes. That has consumers’ attention! Demand for wood and gas supplemental heat has been strong, with lead times increasing as colder weather approaches.”
96
2
8 2
6
2
4
44
(Hearth) “Unusual October. Warm temperatures allowed us to complete chimney repairs. Cool nights increased foot traffic in the showrooms. Wood and pellet sales are up.” Pennsylvania:
22
7 12
30
43
38
13
5
48
100 72
111 114 48 91 117 118 108 121 107 123 100 115
117 118 118
123
98
45
124
1 = COLDEST / 125 = WARMEST
NATIONAL CLIMATIC DATA CENTER/NESDIS/NOAA
Much Below Average
Record Coldest
Below Average
Near Average
Above Average
Much Above Average
Record Warmest
In October, Idaho set a Record Coldest month, while 11 eastern states had Much Above Average temperatures.
STATEWIDE AVERAGE TEMPERATURE RANKS
New York: (Hearth, Spas) “October has
been a pleasant surprise in the hearth area. Our sales have exceeded projections by 15%. We’re not seeing much traffic for fireplace accessories, and the wood stoves have had a lot more interest than last year. That said, let’s all keep our fingers crossed for some cold weather, to keep the store traffic high! “I have noticed a huge selection of pellet and wood stoves on Wayfair.com. None of them mention being 2020 compliant. In fact, Amazon has a lot of them, too, but 2020 compliance is not mentioned anywhere. Is anyone policing these junk stoves on the Internet selling platforms? Who monitors that? Just wondering.”
32
6
91 92 102 101 103
AUGUST – OCTOBER 2019 93
45 32
16 11
32
23
61
31
56
49 60
93
94 113
73
16
102
121
113
124
116 121 122 122 119 122 120 124
99 116
96
87
99 99
123 125
88 96 105 109 106
121 121 121
125
124 125
1 = COLDEST / 125 = WARMEST
Record Coldest
Much Below Average
NATIONAL CLIMATIC DATA CENTER/NESDIS/NOAA
Below Average
Near Average
Above Average
Much Above Average
Record Warmest
For the three-month period of August–October, the states of Alabama, Georgia, and Florida experienced Record Warmest temperatures.
Click here for a mobile friendly reading |experience www.hearthandhome.com DECEMBER 2019
| 75
| Business Climate | Pennsylvania: (Hearth) “This could be
our best year ever. Last year at this time we were up 25% over 2017. Now, at an 11% gain over that, it’s just a super year. This is a 39% change since 2017.” SOUTH
WEATHER REPORT
For the following weather charts, the numbers for each state reflect the temperature ranking for the period since records began in 1895.
STATEWIDE AVERAGE PRECIPITATION RANKS OCTOBER 2019
Arkansas: (Hearth) “Finally getting
some decent retail business due to cooler weather. People are waiting till the last minute to buy and install this year, but at least a few are buying. Unfortunately, we will probably not make up for low sales in the April-May-June 2019 period.”
34
(Hearth, Patio, BBQ) “September was a very quiet month; we had some good sales but fewer of them. I don’t know if more customers are shopping online or just thinking about fall. The weather could be a factor, it’s been extremely warm here in Florida.”
“Sales are picking up as well. Especially, direct-vent conversions to our ever-popular ventfree gas inserts. As several customers said, ‘I want real heat, not just looks.’”
113
78 57
14
Florida:
103
69
117
71
119
77 11
10
42
8
102
82
77
been blessed and found by staying true to our business model instead of trying to be all things to everyone. Of course, the communities we serve are well-established
76 | DECEMBER 2019 | www.hearthandhome.com
113 110 100
118
125 122
85 114
93
1 = DRIEST / 125 = WETTEST
Record Driest
Much Below Average
NATIONAL CLIMATIC DATA CENTER/NESDIS/NOAA
Below Average
Near Average
Above Average
Much Above Average
Record Wettest
In October, Mississippi posted a Record Wettest month, while the states of California, Arizona, and Utah, where precipitation was needed, experienced only Much Below Average.
with disposable income. We believe we are lucky as well.”
Virginia: (Hearth, BBQ) “Down, but still
Texas: (Hearth, Patio, BBQ) “We have
123
115 111 94 107
115
North Carolina: (Hearth) “It has been
a slow spring and summer – more people are waiting for cool weather than normal, so only six slots left for installations before end-of-year break.”
112
99
123
picked up with special orders toward the end of the month.”
Mississippi: (Patio) “Slow start and then
119 120
117 106
112
68
(Hearth) “October’s sales were good, but were dwarfed by annual maintenance calls for the upcoming fall and winter seasons. For three weeks straight, we were averaging five service calls a day. “That’s more than any of the past years. Sales are picking up as well. Especially, direct-vent conversions to our ever-popular vent-free gas inserts. As several customers said, ‘I want real heat, not just looks.’”
— Virginia
118
105
120 109 111 110
Virginia:
a good year. Booked out to mid-January.”
Virginia: (Hearth) “A more refined
marketing plan seems to be paying off.”
MIDWEST Illinois: (Hearth, Patio, BBQ) “Weather was good and people seem to be still catching up from a bad spring when you couldn’t sit on your patio!”
Indiana: (Patio, BBQ, Spas) “Seeing
constant traffic in the store for grills and spas the last two months, which has turned into some extra sales. Our economy in this area is still on the uptick.” Michigan: (Hearth) “We experienced
record hearth sales in October. The economy in Michigan is very healthy.”
Missouri: (Hearth, BBQ) “A rough start
to the year due to many factors that includes spring/summer flooding, has paved the way for a strong fall. The prediction of aboveaverage precipitation in the Midwest for the winter has also helped quite a bit. While we are normally scheduling two to three weeks out at this time of the year, we are currently scheduling over a month out. All other hearth companies in a 60-mile radius are doing the same thing.” (Patio, BBQ, Spas) “Consumer confidence is still there, but with staff changes our sales in general were Wisconsin:
down. Beyond that we had a very late start to our spring, if you can call it that, and a quick shutdown in the weather for fall. Way too short of a season, period.” Wisconsin: (Hearth, BBQ) “Even
though the hearth unit increase is small, the actual dollars of product sold is up 25%. So we’re selling higher-end products.” Wisconsin: (Hearth, BBQ) “Hard to
give you accurate information this time. We are in a retirement mode for this month and last month. So part of the sales are going to the new ownership. I will not be doing the books for them – not that anything is hidden. The combined sales are up. The super cold has amped up the business and demand. Installations are now booking into January.” WEST (Hearth, BBQ) “One hundred and eighty thousand people were evacuated from our area this month because of fires. We’re still five weeks out on our install schedule.” California:
“Sales were brisk, even though there were issues because of the 2020 changes that are coming. It has been a challenging year due to supply and demand. It’s pretty much a price war between dealers trying to move pre2020 units.”
California: (Hearth, Patio, BBQ) “October
was busy; November is very busy.”
California: (Hearth, BBQ, Spas) “Great
month of October, keeping the crews busy with installs and repairs. Should be a great year. Customers are coming into the store more informed than ever, sometimes too informed.” Colorado: (Hearth) “Strong growth in
wood stoves and inserts; gas and pellet units are selling well also. Very close to having all of our wood products changed out to 2020 models.” Oregon: (Hearth, BBQ) “A competing
— Oregon
store for grilling products opened locally in May 2019. Our hearth business for 2019 really just began.”
California: (Hearth, Spas) “It’s been very
Oregon: (Hearth) “Sales were brisk,
unseasonably warm in California, with wildfires north and south of us. Our first three quarters were up, but this quarter has been down as we wait for the weather to change and the season to start. I do feel it will be a great season as we cool down.”
even though there were issues because of the 2020 changes that are coming. It has been a challenging year due to supply and demand. It’s pretty much a price war between dealers trying to move pre-2020 units.”
CONSUMER CONFIDENCE 137.9 129.2
134.2 126.3 125.9
100 90
The Consumer Confidence Index decreased marginally in October, following a decline in September. The Index now stands at 125.9 (1985=100), down from 126.3 in September. The Present Situation Index – based on consumers’ assessment of current business and labor market conditions – increased from 170.6 to 172.3. The Expectations Index – based on consumers’ short-term outlook for income, business, and labor market conditions – declined from 96.8 last month to 94.9 this month. “Consumer confidence was relatively flat in October, following a decrease in September,” said Lynn Franco, senior director of Economic Indicators at The Conference Board. “The Present Situation Index improved, but Expectations weakened slightly as consumers expressed some concerns about business conditions and job prospects. However, confidence levels remain high and there are no indications that consumers will curtail their holiday spending.”
Year Ago
6 Mo. Ago
Aug 2019
Sept 2019
1985 = 100
Oct 2019
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.
www.hearthandhome.com | DECEMBER 2019 | 77
| Business Climate |
STOCK WATCH COMPANY – EXCHANGE
52 WEEK
SYMBOL
WEEK ENDING
% CHANGE
HIGH
LOW
4-Oct-19
1-Nov-19
4 WEEK
3,066.91
2,351.10
2,952.01
3,066.91
3.9%
26 WEEK
52 WEEK
MARKET CAPITALIZATION ($000,000)
Standard & Poor’s 500 (a)
S&P
HNI Corporation (b)
HNI
42.23
29.90
34.37
38.54
12.1%
2.9%
-0.3%
$1,650.00
Pool Corporation (c)
POOL
228.19
137.02
201.66
207.21
2.8%
12.3%
42.8%
$8,030.00
Restoration Hardware (b)
RH
192.00
84.11
170.29
175.84
3.3%
61.6%
40.8%
$3,280.00
Wayfair (b)
W
173.72
76.60
106.77
83.74
-21.6%
-43.7%
-9.9%
$7,800.00
4.1%
12.6%
NOTES: (a) = Standard & Poor’s 500 is based on the market capitalizations of 500 large companies having common stock listed on the NYSE or NASDAQ. It is considered one of the best representations of the U.S stock market, and a bellwether for the U.S economy. (b) = New York Stock Exchange. (c) = NASDAQ.
MARKET CAPITALIZATIONS
52-WEEK STOCK PRICE CHANGE
(US $000,000)
42.8%
$10,000
40.8%
$8,000 $6,000
12.6%
$4,000
-0.3%
$2,000
-9.9%
S&P HNI POOL RH
W
0
HNI
AS OF 01-NOV-2019
2-NOV-2018
CANADA Alberta: (Patio, BBQ, Spas) “One of our best Octobers in our 36-year history!”
25% are purchasing installed systems. No DIY sales for a change, possibly due to tighter regulations at the local level.”
British Columbia: (Patio, BBQ) “The
British Columbia: (Hearth, BBQ)
British Columbia: (Patio, BBQ, Spas)
Ontario: (Hearth, BBQ) “Less foot traffic
weird year continues – last minute shoppers to the extreme this year. We have been either dead quiet or backed up two months.”
“October was up and down with flat sales at the end. The federal election may have played a part as traffic was down, but the weather was bad as well so it’s hard to say. Happy to come out with sales equal to last year.” British Columbia: (Hearth) “Lots of
tire-kicking for hearth, but only about
78 | DECEMBER 2019 | www.hearthandhome.com
POOL
“Hearth sales are consistent – but we now have one more front-line salesperson so we can expect increases to come.” than normal, but high closing rate on gas fireplace sales.” Ontario: (Hearth, BBQ) “Forty years ago
our customers’ average age was the same as mine, today the same thing. Seems the young people have little interest in solid fuel. However, sales are the same as last year. The thrill is going quickly...”
RH
W
1-NOV-2019
Ontario: (Hearth) “We were one of the
lucky ones; a willing buyer came in this summer and bought our store. I was asked to stay on to manage this location. “The current hearth market is a tough one, for these three reasons: It’s very difficult to hire anyone with a gas ticket to work in our business. It’s also hard to compete against fuel suppliers who believe they should be in the hearth industry. And there is a lack of commitment in protected territories from suppliers – even after three decades of loyalty to their products. “While we still have our health, my wife and I will step back and spend time with family. Retail was good, but became increasingly difficult within the last decade. This will be the last time that we can report on this survey.”
MARKETPLACE Finest selection of contemporary European wood and gas fireplaces and stoves Phenix
built-in fireplace
Keep up-to-date on the latest news, trends, data, and events with the leading industry source!
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Wittus Inc. 914.764.5679
www.wittus.com
IMPORTANT POSITION AVAILABLE! Maine, the way life should be… We are located just 12 miles from stunning Acadia National Park. Come and enjoy nature’s beauty - mountains, lakes, ocean coastline, yet with small city benefits including great food, the arts and a wide variety of community activities. Four seasons with long winters creates a strong hearth market. Due to a recent expansion, northern Maine’s largest hearth dealer has an opening for an operations manager to oversee three retail locations, and a full installation and service department of approximately 20 employees total. Ideal candidate would have a strong background in the hearth industry, with a superior knowledge of sales as well as the installation and repair of gas, wood, and pellet appliances. • Experience with residential and commercial contractors and architects a plus. • Very competitive compensation package for the right individual. Please send a letter of interest and resume to matthew@mainestoves.com to learn more about this opportunity to live and work in the spectacular state of Maine.
HIRING A FIREPLACE INSTALLER Fireplace & Gas Services - Orlando FL 32806
Responsibilities • Understanding venting requirements, clearances and other specifics for each installation. • Handle heights as necessary; ladder and roof work are very common • Carry heavy equipment onto job site manually or using necessary equipment as applicable. • Extend gas lines often through crawl spaces, attics, etc. • Install finishes around installed fireplaces with a keen attention to detail and finish work collaborative way. • Must be able to work independently and think on your feet. • Maintain a professional rapport and appearance with clients as necessary.
Skills and Experience • Some construction experience required. • Excellent verbal and written communication is necessary using electronic devices such as tablets to take and upload pictures. • Candidate must be comfortable climbing ladders and getting on roofs. Must work in hot environments. Outdoor work is required through all seasons. • Must be able to regularly lift 50 pounds. • Driver’s license and good driving record. Must consent to a background and drug test.
Apply today at www.blossmangas.com/company/careers/ An Equal Opportunit/ Veterans/Disabled friendly employer.
www.blossmangas.com
www.hearthandhome.com | DECEMBER 2019 | 79
CLASSIFIEDS Business For Sale
Hearth & Fireplace Showroom
1 Column x 1 Inch Minimum Price per column inch = $175 Call the Sales Department at (800) 258-3772
Located in the Greater Vancouver Area, 30+ years in business, looking to sell or partner with investor/collaborator.
For more information/details email: fireplacesandmorevancouver@gmail.com
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Page
Phone
Website
Apricity / Agio - USA
C2
(888) 997-7623
www.apricityoutdoor.com
Blaze Outdoor Products
27
(866) 976-9510
www.blazegrills.com
Blossman Gas
79
(540) 955-4677
www.blossmangas.com
Bull Outdoor Products
45
(800) 521-2855
www.bullbbq.com
Escalera
79
(800) 622-1359
www.escalera.com
Ever Green Home & Hearth
79
(207) 989-0077
www.mainestoves.com
3
(703) 522-0086
www.hpbexpo.com
IMC – Las Vegas
59
(702) 599-3046
www.lasvegasmarket.com
International Casual Furnishings Association
73
(336) 884-5000
www.icfanet.org/2020-icfaeducational-conference
Louisiana Grills / Dansons
C4
(877) 303-3134
www.dansons.com
Lovinflame
25
909-781-8462
www.lovinflame.com
Napoleon
8, 9
(800) 461-5581
www.napoleon.com
10, 11
(866) 606-6330
www.peakseasoninc.net
Hearth, Patio & Barbecue Association
Peak Season Spartherm
53
+49 1522 26 44 162
Sunbrella / Glen Raven
51
(336) 227-6211
www.sunbrella.com
Telescope Casual Furniture
83
(518) 642-1100
www.telescopecasual.com
Valor / Miles Industries
33
(800) 468-2567
www.valorfireplaces.com/nopower
Wittus Fire by Design
79
(914) 764-5679
www.wittus.com
80 | DECEMBER 2019 | www.hearthandhome.com
www.spartherm-america.com
Who Reads
?
Jan Trinkley, for one! President/Director Marketing & Sales for Gensun; Rancho Cucamonga, California
With the Outdoor Room’s current popularity, and the highquality designs available it’s time for the independent dealer to again fill the niche of giving the consumer what they want. “RH, Ethan Allen, and Frontgate are doing very well with outdoor furniture. Bernhardt is entering the market. Consumers want quality and they will pay for it.”
Special Interests/Hobbies: “Family time, reading, landscaping, football, and golf.” Problems/Issues Facing the Patio Industry: “The issue of low-price products that are often low-quality products. The Big Box/Mass Merchant stores have increased their percentage of the market in recent years. One reason for this is the reduction of independent dealers after the banking crisis/recession in 2008 and 2009. “Another reason is that the mass merchants have stepped up their offering with aluminum furniture and better fabrics, but kept the price low due to their buying power. Some dealers have taken on these lower-price products in hopes of getting some of this business. In some cases they have, but in many cases it hasn’t worked. “Independent retailers can’t turn the door enough times, and their cost per sq. ft. is too high to be successful. They also need to pay their retail salespeople better than the mass merchants pay theirs. “From the 1990s to the mid-2000s special/custom orders were a large part of the specialty dealers’ business. They had a very nice niche and the consumer bought. Today, special/custom orders are much fewer as many dealers concentrate on price.
Advice to Retailers on Increasing Business: “Sell to your strength. The independent dealer has the ability to talk with the consumer and give them what they want. The mass merchant doesn’t have trained and skilled salespeople who can do this. “Promote and display the whole room. Again, the dealer can do this and the mass merchant cannot. Many consumers don’t understand quality, nor what the dealer has to offer. They need education on quality, and being able to get different designs and fabrics. Only the dealer can do this.” Forecast for Patio Sales in 2020: “The Outdoor Room’s popularity continues to be at the top of the list for the consumer’s discretionary dollars for their home. Furniture, grills, fire tables, and kitchens have all received significant press confirming this. The forecasts say it will continue. It’s a great opportunity for the dealer to grow and to grow profits!” Years Reading Hearth & Home: “25 years.” Reasons for Reading Hearth & Home: “Hearth & Home covers the entire outdoor industry. The articles and photography are excellent. I enjoy Hearth & Home’s dedication to the industry as a whole, providing everyone with knowledge and current information to better their business. It’s a great read!”
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| Parting Shot |
Bali in the Desert T he blending of Balinese pod-style architecture with contemporary design aesthetics, then placing it in a desert landscape with towering saguaros and views of Pinnacle Peak, was a challenge for the folks at Tate Studio Architects in Cave Creek, Arizona. The patio area wraps around the negative edge black water pool and spa that creates a feeling of tranquility. Resting inches above the water’s surface is a bronze sculpture titled “Devorah” by Venice Beach artist Guy Dill. At night, live flames seemingly emerge from the blackness of the pool to highlight the sculpture.
Tate Studio Architects, 7100 E Cave Creek Road Building 11 Suite 103, Cave Creek, AZ 85331. (480) 948-3517; www.tate-studio.com/studio; info@tate-studio.com. SPECIALTY FIREPLACES by Wayne Holsapple; 2680 E Mohawk Lane #15, Phoenix, AZ, 85050; (602) 993-7646; www.specialtyfireplaces.com. Sculpture by Guy Dill, www. guydill.com; studio@guydill.com
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