Patio Retailing: Past & Future — A Good Year!
By Tom Lassiter
Based on a totally unscientific and thoroughly random survey of casual furniture dealers throughout North America, it looks like 2015 was kind to most retailers.
Most shops contacted by Hearth & Home reported a bump in sales over the previous year. This occurred despite atrocious spring weather in some regions and economic setbacks in others, particularly areas where the faltering petroleum industry dominates.
Some retailers were up in double digits, though most reported sales up in single digits or flat in comparison to 2014.
The year saw one of the industry’s best-known retailers close up shop, though not for lack of business.
Pool & Patio Center in the New Orleans suburb of Metairie closed just before Labor Day. Second-generation owner Bruce Aronson received an offer to purchase his property, which speeded up his retirement plans significantly. With no family members waiting to take over the business, and no likely buyers standing by, Aronson opted to sell out while he was on top.
Here’s what we learned, by region.
Atlanta’s Kolo Collection opened a showroom at the Atlanta Decorative Arts Center (ADAC) in September. “The design trade is super busy, and that’s a big part of our business,” said owner Greg Martin. Contract business also was strong. “We are going to be up for the year,” he said.
The brand registering the greatest growth was Dedon, fueled primarily by designer sales. Direct sales to consumers were also strong. “The bottom line is, when you commit to a line and show depth in a line,” Martin said, “you’re going to sell the line.”
Kolo Collection added Lloyd Flanders for 2015 and expanded its offerings from Cane-line. Sales of Jensen Leisure products were “up significantly,” he said. “It’s a great line. Lead times are amazing.
“We try to continue a balance of modern and contemporary with plenty of traditional and sophisticated looks to satisfy both ends of the spectrum,” he said.
The company’s 2,100 sq. ft. ADAC showroom features six furniture lines and TUUCI umbrellas.
The outlook for 2016 is positive, Martin said. New employers continue to move to greater Atlanta. Demand for housing in the central part of the city remains strong. “They can’t build apartments fast enough,” he said.
Paine’s Patio on Cape Cod, Massachusetts, expects to finish the year up about 20 percent, said owner Doug Shearer. “It’s been a surprisingly good year,” he said, “considering that 2015 began with six weeks of snow followed by six more weeks of winter. But the second the snow started melting, people came out in droves, thinking warm thoughts.”
April sales were up 50 percent over the prior year and sales remained relatively strong as the year progressed. “We had a tremendous season,” he said, “definitely our best ever.”
Products from Seaside Casual led sales, followed by furniture from Kingsley-Bate, Telescope and Lloyd Flanders. The shop offers resin wicker from several vendors, Shearer said, and resin wicker remains “one of the top categories.”
Cast aluminum, however, “was way off,” he said. “Tubular sling was mediocre at best.”
Shearer said the island’s economy is strong. “We’re seeing more homes being built, more condo-type second homes, and getaway spots. And it doesn’t hurt that we are in a very wealthy resort area.”
Casual Marketplace in Hockessin, Delaware, celebrated its 20th anniversary this year. Owner Petey Fleischut marked the observance with more promotions and events than usual. An event that offered Continued Education Units for interior designers was well attended, she said.
By year’s end, Fleischut expects volume to be about the same as in 2014.
Woven casual furniture continues “to outsell just about everything,” she said, although “cast and extruded aluminum seemed to take a big jump.”
She also noted more demand for “better dining sets” than in recent years. Shoppers, she said, “were looking for better, not just mediocre, dining sets.”
Fleischut is optimistic about the coming season. “I’m feeling exceptionally good,” she said. “I’m anxious to move into 2016.”
“People are just in the mood to spend money,” reported Debbie Stegman, whose family owns three Elegant Outdoor Living stores in southwest Florida. “There’s nothing that’s not selling. We had a great year.”
Woven deep seating, especially sectionals, proved to be the most popular category, Stegman said. After several seasons in Florida, she’s learned to stock deeply. Customers, she said, “want it now. They only have a certain amount of time here, and then they go back up north.”
Woven furniture by Patio Renaissance is the retailer’s most popular product, she said. Bar-height groups are less popular with her Baby Boomer customers. “They’re afraid they’re going to fall off,” Stegman said.
Plastic furniture sells for use on docks and by the water, where the heavy, maintenance-free furniture ignores ocean gusts. For their covered lanais, homeowners want deep seating for lounging.
The stores don’t sell grills and have been “too busy with everything else” to develop an outdoor kitchen business, she said. “It’s all still deep seating for us.”
The Central Region
The year will close out “pretty much status quo” at Percy Guidry Hearth & Patio in Lafayette, Louisiana. Keith Guidry, manager of the family-owned business, feels fortunate about that given the state of the local economy. The region is heavily dependent on the petroleum industry, which is experiencing a significant downturn with widespread layoffs.
“They’re saying oil and gas will stay this way for another year,” Guidry said. “We just have to hunker down and ride out the storm.”
Grills are a focus at Percy Guidry, which manufactures its own brand, the Cajun Grill. The store also sells leading brands such as Fire Magic, Sabre and Twin Eagles, plus Primo kamado models.
The store produces a regular cooking show on a local television station, which Guidry co-hosts with a celebrity chef. “Grillin’ with the Guru,” he said, “continues to pick up more traction. It adds to the professionalism. We don’t just sell grills. We use them.”
Grill and hearth sales were up a bit this year, he said. “The one disappointment we’ve had is that our patio furniture has taken a hit.”
Sales of domestically-made furniture have declined, Guidry said, while sales of imports are up. “But I have to sell more Chinese sets to make the same gross dollars,” he said. “It’s a challenge. We’re doing everything right. If I was in a major market, I’d be lethal.”
With a relatively short spring and fall separating a hard winter from a blazing summer, Omaha, Nebraska, doesn’t seem to offer an extended season for enjoying fire pits. Yet fire pits are extremely popular with customers at Mulhall’s, says general manager Mick Mulhall. “OW Lee does a great job for us,” he said, “and we do some through Castelle.”
Consumers gravitate to deep seating in metal frames as well as wicker, he said, and “motion is huge.”
Mulhall’s leading metal furniture vendors are OW Lee and Castelle, which were joined this year by Alumont. Wicker products by Erwin and Sons were complemented by the addition of Brown Jordan and Kingsley-Bate.
Sales of wicker started slowly in 2015. “We were a little bit scared in the early season,” Mulhall said, “and it closed really strong for us.” Overall, he said, the year has been “great, really great.”
The store remodeled its interior and built a consultation space specifically for outdoor furniture sales. The company also sells landscaping and nursery products and has a large floral department.
Expenditures for promotions and advertising are few. Mulhall would rather “spend those dollars improving our store,” he said.
Cardinal Pool & Outdoor in Champaign, Illinois, undertook a major remodeling project in 2015 and “really jazzed it up,” said manager Sharon Pauza. The family-owned business installed a stone wall in front, put down recycled flooring, installed a pergola and new signage.
Plastic furniture by Berlin Gardens is “what’s paying the rent right now,” she said. “People love it.”
The store also carries furniture by NorthCape and Tropitone. “We did very well with all of our brands,” she said. “We had a burst of warm weather that encouraged a lot of end-of-year shopping. It’s been a busy, busy year.”
Bell Tower Lake House Living in Richland, Michigan, “had a pretty good year” even though the weather stayed chilly well into June, said co-owner Ashleigh Kosin.
The shop added indoor upholstered goods to its lineup this year, specializing in special orders and many of the same performance fabrics as used for casual furniture. The indoor furniture “actually helped sell the outdoor,” Kosin said.
Special orders account for about 80 percent of the store’s business, she said.
The shop’s best-selling lines are higher-end plastic furniture by makers such as Seaside Casual and Canadian Recycled Plastic. Telescope’s MGP (marine grade polymer) also is popular in this region of lakes and summer cottages.
Kosin noticed that customers often chose swivel-rocker sling sets to place around gas fire pits. “Ease of use” drives that choice, she said.
Another surprise: an increase in sales of dining tables seating six to eight people. Kosin had been expecting to see a boost in sales of deep seating, but that category remained relatively flat.
The company will open a second location for the 2016 season. “We’re hoping for a great year,” Kosin said.
Into the Garden expected to end the year “about flat,” said Scott Wilshire, director of operations. He blamed it on the exceptionally wet spring. “We went from cold and rainy to hot and humid,” he said, “with no nice months in between.” The company has stores in Dallas and Fort Worth.
Teak sales were surprisingly strong, he said, surpassing woven products. “Solid teak in transitional and contemporary is where we’ve done really well,” he said. The store’s main teak vendor is Kingsley-Bate, whose Venice collection sold well in dining as well as deep seating.
Wilshire noted “high demand for non-cushioned deep seating,” while demand for transitional and traditional woven styles declined.
Most shoppers are looking for instant gratification, he said, which leads Into the Garden to rely heavily on its warehouse. Special orders account for just 10 to 15 percent of sales.
The company has cut back on advertising in recent years and upgraded its website “to make it easier to shop the furniture.” The website is only for marketing and lists no prices.
The Dallas-Fort Worth economy is strong, and Wilshire is optimistic about 2016. The company reshuffled its product mix and listened to customers, Wilshire said, “to create what we think is the perfect mix on which to get good turns.”
Lousy spring weather hampered sales at Outside In Style in Austin, Texas. Even so, said owner Karen Galindo, “We’ve had an OK year.”
Galindo noticed an uptick in sales of metal furniture. Her customers want big metal chairs, such as OW Lee’s Monterra and San Cristobal. Also trending upwards are groups with styling that is “clean and elegant and contemporary,” such as Homecrest’s Grace sling.
Homecrest, she said, is “going after fresher, cleaner designs. They’re really coming up with great products.” Along with TUUCI and Gloster, she said, Homecrest has “fully embraced the trend of what’s going on right now.”
Galindo’s customers bought cantilevered umbrellas “stronger than ever.” Dining tables with slat-metal tops drew more interest than cast metal, she said, and OW Lee’s porcelain tabletops were a hit. Sales of Jensen Leisure products remained strong.
Galindo said her customers want furniture with a strong sense of design. Furniture that is simply big but boring “just sat there” on her floor. Such furniture is comfortable, she said, “but for $1,200 a chair, I need something that looks pretty, too.”
If the weather cooperates, Galindo said, she expects 2016 will “be a great year.” She continues to look for ways to engage younger consumers. “We have to be real cognizant of how to get them into our brick-and-mortar stores.”
Jim Montgomery’s forecast for 2015 worked out as planned. He opened a second Backyard Expressions store in Huntington Beach, California, to complement his Yorba Linda location. Sales doubled. “It will end up as my best year ever,” he said.
Montgomery, in business for eight years in Yorba Linda, took over a former Anaheim Patio & Fireside store for his second location. He is a former Anaheim Patio employee and worked in that store for 35 years.
Big sellers this year included “anything that rocks. People love action pieces,” he said. Sales of fire pits also remained strong, led by OW Lee models.
Many customers opt for sectional deep seating, in part because of the flexible options. “They can add and make it as big or as small as they want,” he noted.
Leading brands at Backyard Expressions include Patio Renaissance, Hanamint, OW Lee, Alumont and Tropitone. Montgomery says his area (south of Los Angeles) has seen a decline in specialty stores; many shoppers visit his store after reviewing outdoor furniture at Lowe’s or Home Depot. “They get a little sticker shock,” he said. He counters that by showing a picture of his own backyard furniture, which is 15 years old and looking great.
“I tell them, What you’re going to buy here lasts a long time. You won’t see me for 10 years.”
“Overall, it’s been a good year,” says Chad Scheinerman of Today’s Patio, with six stores in Arizona and a shop in San Diego, California. “I’m not seeing major increases; I’m not seeing major decreases. If I compare it to several years ago, it’s a fantastic year.”
The calendar year still had 60 days to go when Scheinerman was interviewed, and Arizona’s winter snowbirds were just starting to arrive. “We’re getting into our second season,” he said, “and starting to see the trend of those nice tickets come through.”
In one recent seven-day stretch, one location sold three 84-in., $4,000 tables.
Synthetic wicker continues to be the most popular category, especially groups with clean, transitional lines. “Deep seating is still the majority, but dining is also strong for us,” Scheinerman said.
Wicker in combination with teak or metal – “that fresh, clean Resto look” – is popular with shoppers, he said.
Stone tabletops have declined somewhat in popularity while wood-look tables are trending upwards. “People can get that wood look in porcelain tile at a better price,” he said. He expects Plank & Hide’s wood-look composite tabletops to do well.
Scheinerman is cautious about making predictions about sales increases in 2016. “Because it’s an election year,” he said, “we’re not expecting any big growth.”
Sales at Outdoor Elegance in LaVerne, California, are on track to finish the year up more than four percent, said president Doug Sanicola. “Our customers are spending a lot of money,” he said. “Our average sales dollars have increased tremendously.”
Catalina by Patio Renaissance is the store’s best-selling group. Deep seating outsells dining four-to-one, he said. Metal furniture from Hanamint and OW Lee continues in popularity.
The store has a Jensen Leisure gallery that’s done extremely well. “We couldn’t keep (Jensen Leisure products) on the floor,” he said, noting that demand seemed to fall off slightly as the season progressed.
The Southern California economy has recovered significantly from the depths of the Great Recession, he said, with strong housing sales fueled in part by an influx of wealthy Asian immigrants. “They come in and pay cash for everything,” said Sanicola, who retains a Chinese interpreter who works by appointment.
Outdoor Elegance has seen an uptick in larger tickets, with clients furnishing multipart Outdoor Rooms as well as kitchens. Tickets ranging from $40,000 to $70,000 are not uncommon.
The store has relationships with a large number of interior designers who bring a steady stream of business. One designer brought in an estimated 10 projects this year, Sanicola said, “and not one was under $25,000.”
The store aims to serve “the one and two percent (of the population),” Sanicola said, catering to the wealthy set in every way. When designers want their clients to join them at Outdoor Elegance, a town car is sent to fetch them.
Sanicola uses only digital marketing (social media and e-mail), supplemented by ads in the regional edition of Dream Homes magazine. He said the store’s website – which only markets and does not sell products – generated $850,000 in business in 2014. “If you don’t measure it, you don’t know if it worked or not,” he said.
Wicker World in Winnipeg, Manitoba, expects to finish the year with patio furniture sales up around 15 percent. The store also sells indoor furniture and expects overall sales to be up more than 20 percent for the year, said Phil Squarie, president.
The strong performance is especially gratifying because 2014 also set sales records, he said.
Groups from Ratana and Ebel led sales in resin wicker, Squarie said, noting “sectionals are huge for us.” However, sales of cast aluminum have ebbed and “traditional dining is off.” Grills are another strong category.
Wicker World in years past could plan on at least one casual furniture group to turn many times, but sales patterns have changed. “We used to have a set we’d sell 20 of,” he said. “We just don’t see that anymore.”
Squarie expects to see retail prices jump 15 to 20 percent next year because of Canada’s weak dollar. “It’s not hurting me,” he said. “It’s hurting our clients. But there’s nothing we can do.”
Fashion-forward specialty retailer Clarinda Kung reported strong sales at Ginger Jar in Vancouver. Teak by Les Jardins and Gloster continued to be popular with her customers, she said, noting that 2015 has been “a tremendous year for contract.”
Woven products remain a best-selling category, as well as a fully upholstered European line. “Our best vendor is not showing in Chicago,” said Kung. “We buy the majority from Europe, to get our own look” and “not follow the trend.”
Vancouver’s consumer economy remains strong, she said, helped by a constant flow of “offshore buyers, and they have the money.”
Spring weather was good to Patio Palace, which has three stores in Ontario (two in London and another in Windsor). The “phenomenal weather” abruptly disappeared in June, said president Steve Gilboe, which erased most of the gains racked up in the spring. Nice weather from July through October sent sales trending upward again.
“Our sales are up in high single digits,” Gilboe said. “But I think our profits will be compromised because of our Canadian dollar.”
Deep seating resin wicker chat groups were the season’s most popular category. The lead vendor is Ontario-based Cabana Coast. “They maintain a huge inventory,” Gilboe said, and stock 200 Sunbrella fabrics, which allows for quick shipment of special orders.
Sales of Telescope products were strong, as were sales of plastic furniture. Stratford, a group by Canadian Recycled Plastics, “did surprisingly well,” according to Gilboe.
Resin wicker accounts for about 50 percent of the company’s furniture sales. Cast and extruded aluminum comprise about 25 percent of sales, followed by plastic furniture at about 20 percent. Wood furniture brings in about five percent of sales, he said.
The surprising disappointment of the year was low demand for crescent-shaped seating. Options in crescent seating have exploded in recent years as fire pits have gained in popularity. While Patio Place did quite well with fire pits, and saw good demand for curved seating in 2014, that changed this year.
“We did not do well with anything in a semi-circle or crescent formation,” Gilboe said.
Usually rain-soaked British Columbia experienced a severe drought this year, and that turned out to be good for casual furniture sales.
“We had a tremendous spring and summer, weatherwise,” said Rod Boucher, president of Endless Leisure in Burnaby, just east of Vancouver. The season started earlier than normal and remained strong before tailing off in September as expected.
“I’m happy with everything we did,” he said. Sales were up in all categories.
Synthetic wicker deep seating remained the shop’s top category. Ratana, which is headquartered nearby and can deliver product quickly, is the store’s leading brand. E9 Lifestyle from American Home, also based nearby, took the No. 2 spot in wicker. E9 offers more contemporary styling and the full line of Sunbrella fabrics, he said, which makes special orders appealing for customers.
Special-order business also was strong for Tropitone products, Boucher said. Demand for Kettler products, however, declined. He blamed costs for shipping to western Canada from Virginia, coupled with Canada’s import duty and an unfavorable exchange rate. The brand, he said, “is not the value it once was.”
The big surprise for 2015 was the surge in grill sales. Endless Leisure carries Napoleon’s Prestige line as well as Primo ceramic grills. Napoleon’s regular promotions drove business to the store, Boucher said. Customers were educated about what was available, he said, “rebates, accessories, you name it.” Grill sales rose by 200 percent.
The disparity between the Canadian and U.S. dollar will be a challenge next year. “In the early 2000s, our dollar was worse off than it is now,” Boucher said, “and we still seemed to manage. We just have to work a little harder, be more creative, and convince folks to buy. That’s all.”