Hearth & Home August 2017

2017 June Business Climate


June Sales

In early July, Hearth & Home faxed a survey to 2,500 Specialty retailers of hearth, barbecue and patio products, asking them to compare June 2017 sales to June 2016. The accompanying charts and selected comments are from the 192 useable returns.


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Weather Report

Consumer Confidence

Stock Watch


RETAILER SALES – U.S. AND CANADA
June 2017 vs. June 2016

Between a third to a half of retailers across the board reported no change in sales from a year ago.


13 MONTH YEAR-OVER-YEAR RETAILER SALES
June 2016 Through June 2017

Although all four product categories had increased month/year sales, only hearth products showed a higher percentage increase compared to June 2016.


Retailer Comments

Northeast

Connecticut: (Hearth) “A little traffic, mostly for gas products. Hoping last winter’s decent season brings in some customers in the coming months.”

Maine: (Patio, BBQ) “June sales were disappointing but not completely unexpected. Warmer weather shifted consumer focus toward summer pursuits. However September and October are forecasted to be cooler than usual.”

Maine: (Hearth) “Every year it keeps going down, including June. Maybe it is the oil prices, cheaper priced products offered by Big Boxes or the area is saturated. The advantage the Big Boxes have are cheaper quality products and zero service call back.”

New Jersey: (Hearth, Patio, BBQ) “June had a surprisingly nice increase. Gas products are king at this time. Wood and pellet products?”

New York: (Hearth, Patio, BBQ, Spas) “We can’t keep spas in stock right now. They’re selling better than ever. Pools have been a huge boom, but Mother Nature is fighting us hard to get them installed.”

New York: (Hearth, Patio, BBQ, Spas) “Great traffic, terrible weather.”

New York: (Hearth, Patio) “First six months we are up a total of 8% in combined categories. After July 4th each year the atmosphere changes back to fall/winter preparation. Showroom foot traffic has increased.”

New York: (Hearth, BBQ, Spas) “June is always a difficult month here in New York. Graduations, weddings and taxes due have people allocating their money elsewhere. Things pick up here after the 4th of July. Happy selling, all.”

New York: (BBQ, Spas) “Great month, just unable to match 2016 June numbers. We will take it though.”

New York: (Hearth) “We’re still here. We have shorter summer hours and one less employee, so perhaps we’ll hold our own or see a small profit next month.”


Weather Report

For the following weather charts, the numbers for each state reflect the temperature ranking for the period since records began in 1895.

Delaware was the only state east of the Mississippi River with Much Above Average temperatures in June, joining New Mexico, Arizona, Utah, Nevada and California in the West/Southwest.

Only the six states of Nebraska, Kansas, Oklahoma, Arkansas, Louisiana and Mississippi had Near Normal Average Temperatures for the three-month period. Temperatures throughout the rest of the contiguous U.S. ranged from Above Average to Much Above Average.

Most of the contiguous U.S. experienced Near Average to Much Below Average precipitation in June. Only Vermont, Florida, Alabama, Mississippi and Louisiana had Much Above Average rainfall.

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South

Arkansas: (Hearth) “Crazy weather and vacation time put the hurt on retail sales this month. Strange year so far.”

North Carolina: (Hearth) “Unfortunately at this time I must apologize for my no good (recently FIRED) new software man. Our system at this time is a cluster *%$# to say the least, and due to this unbearable humid weather, as well as the limited number of quality workers available, I know my volume is down. But my margins are up, so I would guess everything is the same.”

Oklahoma: (Hearth) “Sales were down a little due to 90 degree weather and lots of rain. Come on winter.”

South Carolina: (Hearth, BBQ) “Despite the weather – heat and rain – we have done very well with grills this year. We brought in pellet grills and they appear to be leading the way. We’re focusing on brands that are not in every hardware store and on every poosl and spa dealer’s showroom floor.”

Texas: (Hearth, Patio, BBQ) “Slowest June we’ve experienced in overall sales at our new location.”

Texas: (Hearth, BBQ) “Sales are lumpy, but are up. Best selling products have a 40% plus gross margin. The rest are commodity products which the manufacturers over saturate the market with. They are also attempting to dictate obscenely low margins. Guess what guys! I either don’t carry your products, or sell other brands on my floor!”

Texas: (Hearth, Patio, BBQ) “June started off strong and continued all month long. Barbecue and accessories have been strong, as has new customers coming in and planning new outdoor living areas. The year started off slow but has come back now strong to put us ahead of last year.”

Midwest

Iowa: (Hearth, BBQ) “July has started with a BANG!”

Michigan: (Spas) “Incredible month – absolutely incredible. We loaded up in April and May with so much inventory because I felt it was going to explode. It did. They came, they saw and they bought. We loaded it and said goodbye. We measured closing ratio; UPS hit an all time high percentage. Very, very happy.”

Michigan: (Patio, BBQ) “May was a bigger month this year than years past. We feel an influx of early birds getting in to complete special orders affected sales for cash-and-carry purchases last month.”

Michigan: (Hearth) “May finished behind 2016, but June made up for it! Great month with builders and residential. Hoping July is as good!”

Missouri: (Hearth, BBQ) “Very strong heating sales in fireplaces for new construction. New home sales are robust in our region. Record barbecue sales this month and for the year!”

Ohio: (Hearth, Patio, BBQ) “Great June after a great May!”

Ohio: (Hearth, BBQ) “The extreme interest on pellet grills has subsided although the interest never really turned into sales. Trying a new stainless steel gas grill line that sells in the $2K - $3K range. Hearth remodeling projects are still going strong. Very encouraging sign.”

Wisconsin: (Hearth, BBQ) “Lots of work here. Looking for a dependable solid employee.”


Consumer Confidence

The Consumer Confidence Index, which had decreased in May, increased moderately in June. The Index now stands at 118.9 (1985=100), up from 117.6 in May.

“Consumer confidence increased moderately in June following a small decline in May,” said Lynn Franco, director of Economic Indicators at The Conference Board. “Consumers’ assessment of current conditions improved to a nearly 16-year high. Expectations for the short-term have eased somewhat, but are still upbeat. Overall, consumers anticipate the economy will continue expanding in the months ahead, but they do not foresee the pace of growth accelerating.”

A reading above 90 indicates the economy is on solid footing; above 100 signals strong growth. The Index is based on a probability-design random sample conducted for The Conference Board by The Nielsen Company.

The Index is based on a probability-design random sample conducted for The Conference Board by The Nielsen Company.

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West

Alaska: (Hearth) “We had no business in the spring. By far it was the worst ever. June stove sales were great.”

California: (Hearth, BBQ) “June was nearly the same as last year. It begins our slow season and we can only hope the following holiday season makes up for the low sales numbers.”

Nevada: (Hearth, BBQ) “Good summer so far.”

Oregon: (Hearth, Patio) “June was a great month. Foot traffic has slowed down, but we are still riding a backlog of sold jobs. July will most likely bottom out the year and then we start the climb!”

Utah: (Hearth) “TOO HOT!!!”

Washington: (Hearth, Patio, BBQ, Spas) “Crazy busy. Record June sales.”

Canada

British Columbia: (Hearth, Patio, BBQ, Spas) “June was interesting. Hot tubs and patio furniture up, barbecues and fireplaces down. Overall we were up 10%, so not a bad month. Would have liked to see more consistent category growth, but we will take sales any way we can get them.”

Ontario: (Hearth, Patio, BBQ) “Rained 26 days out of 30. Really puts a damper on outdoor play. Pellet stoves staggering; wood holding well. Up 40% over 2016 but still not like it was.”

Ontario: (Hearth, BBQ) “On a great roll from March to the end of June. $$$.”

Ontario: (Hearth, Patio, BBQ) “Surprisingly good month.”

Ontario: (Hearth, BBQ) “The new construction and renovation market has inclined. Great to see after a dreadful winter. So from here on in things look good, I am happy to report.”


Stock Watch

COMPANY – EXCHANGE SYMBOL 52 WEEK Week Ending % CHANGE MARKET CAPITALIZATION
    High Low 2-Jun-17 30-Jun-17 4 WEEK 26 WEEK 52 WEEK ($000,000)
Standard & Poor’s 500 (a) S & P 2,453.46 2,037.41 2,439.07 2,423.41 -0.6% 8.2% 15.2%  
HNI Corporation (b) HNI 56.96 37.24 45.29 39.87 -12.0% -28.7% -14.6% $1,750.00
Pool Corporation (c) POOL 124.26 88.65 122.45 117.57 -4.0% 12.7% 23.7% $4,980.00
Rentech (c)(d) RTK 3.97 0.36 0.46 0.45 -1.5% -81.7% -82.2%     $14.88
Restoration Hardware (b) RH 69.26 24.11 42.54 64.52 51.7% 115.4% 115.1% $2,240.00
Wayfair, Inc. (b) W 78.21 27.60 68.18 76.88 12.8% 119.3% 102.0% $6,340.00

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
(d) = Rentech is the parent company of New England Wood Pellet, which is the parent company of Allegheny Pellet.

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More Industry Data

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In early November Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, barbecue and patio products, asking them to compare October 2017 sales to October 2016. The accompanying charts and selected comments are from the 214 useable returns.

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In early August, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, barbecue and patio products, asking them to compare July 2017 sales to July 2016. The accompanying charts and selected comments are from the 216 useable returns.

» Continue

2017 May Business Climate

In early June, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, barbecue and patio products, asking them to compare May 2017 sales to May 2016. The accompanying charts and selected comments are from the 196 useable returns.

» Continue