Waking Specialty Retailers!
By Bill Sendelback
Electric fires are the largest hearth products category, topping two million units sold annually. They account for more than $500 million in manufacturers’ gross sales and, in unit sales, outsell the total of all wood, pellet and gas appliances by almost three times.
The bad news is that channels other than specialty hearth retailers are enjoying the vast majority of those sales. However, even though the bulk of electric fires are being sold by furniture retailers, mass merchants, online retailers and even consumer direct, more hearth products dealers are increasingly finding sales success with electric models. That may be due to the fact that more manufacturers are designing and offering full-featured, upscale electric fires for the specialty hearth channel. Even manufacturers that have been keen on mass merchants are now strengthening their efforts toward specialty retailers.
|Landscape Full View 100 by Modern Flames.|
That’s really just in time. Hearth & Home’s retailer survey, published in June, 2015, reveals that 67 percent of U.S. hearth products retailers are now selling electric fireplaces. However, electric fires still only account for three percent of the average U.S. hearth retailer’s gross sales, a striking indication of electric fires’ sales weakness through the traditional hearth market.
“We’ve had a good year, but not spectacular,” says Scott Ringler, vice president of Marketing and Product Development at Dimplex North America. “Electric fires are becoming more of a factor with hearth dealers, and we’re having great success with these retailers. So we’re developing products specifically for the hearth market.”
Consumer awareness of electric fires is increasing as they learn how realistic they really are, Ringler adds. “With today’s better flames and the ease of installation, it’s an easy story to tell. People want to put flame products where wood or gas models may not be appropriate, such as in bathrooms. Electric fires are being used more for commercial and hospitality markets. They get the ambiance of a fire without the downsides of installation and venting challenges, and too much heat.”
Dimplex is offering larger versions of its wall mounted XLF series, now in 50-, 74- and 100-in. models. New in its BLF Prism series is a 50-in. linear model that can be wall-hung, recessed or partially recessed, featuring seven light colors with a “cycle” mode.
Dimplex’s Opti-Myst series offers a 1000 MM Cassette, a 39-in. linear model featuring plumbing connections for the mist feature; the company is also offering an Opti-Myst electric stove.
“We’re having an outstanding year,” says Tom Foy, general manager of Modern Flames. “Linear landscape models have really caught on. We don’t sell to furniture stores or Big Box outlets, but our hearth dealers are doing well, some spectacularly well. Interior designers and architects are embracing electrics, and we’re seeing more and more interest from home builders because of the various regulatory restrictions and the increased costs of installing gas models.”
New features have been added to Modern Flame’s Ambiance CLX series with 40-, 60- and 100-in. models, each only four in. deep, and now with enhanced and colored flames, and upgraded fronts. A new “mother board” offers more capacity, more functions and can be operated from a smart phone.
“This has been an excellent year, and sales are ever increasing,” says Brian Richards, president of Amantii and Sierra Flame. “These are not like grandpa’s old logs, and hearth dealers are more embracing of electric fires. Consumers are asking for them.” He says electric fires are following the TV market. “It’s now normal to buy a 50-in. TV set, so electric fires are getting bigger, too. Our best selling size is now our 60-in. model, and the trend is toward bigger and bigger.” Richards also maintains that women drive the consumer sales of electric fires.
New from Richard’s Sierra Flame brand is its Vista series, clean-faced, built-in models featuring three strips of colored lights allowing the mixing of colors for a wide variety of lighting colors. Also featured are canopy lights shooting down on the logs and glass ember beds to reflect that light. These models are also approved for outdoor use. In the Amantii Flame line, new models include updated flames and log sets, improvements Richards says were company reactions to dealer requests.
|Napoleon’s Woodland 27-in. log set.|
Napoleon Fireplaces is doing “really well” with its line of electric fires, according to Kim Hammill, director of Electric Fireplaces, but she says hearth dealers don’t represent the bulk of the industry’s electric sales.
“Many hearth dealers are still diehard gas and wood products proponents,” she says. “But our hearth dealers that have embraced our electric fires are having no problems with other types of retailing because of our Minimum Advertised Price (MAP) policies helping to keep advertised pricing in line. If your manufacturer is a true partner, (MAP pricing) puts a hearth dealer on a level playing field with other types of sales outlets.”
Consumers are willing to pay a little more money for the more realistic flames and quality furniture offered through hearth dealers, Hammill says. “Consumers like wall-mounted models that also can be built-in, and linear models with more flames. Entertainment centers are growing in popularity with today’s smaller rooms where the TV and the electric fire can be combined in one unit.”
Napoleon’s Azure series wall-hung linear models are available in 42-in. and 50-in. models, plus a vertically styled 38-in. model. They include two flame and color settings, a backlit “night light,” glass front and clear glass embers. The 50-in. model can be recessed. Also new from Napoleon are electric log sets using Napoleon’s experience in gas logs for realistic logs and flame patterns.
The Outdoor GreatRoom Company’s electric fire business is “quite strong,” according to Ross Johnson, vice president of Marketing, primarily with wall-mounted linear models. “We’re getting more inquiries from builders and designers for hotels and hospitality installations, such as restaurants, where they want the linear look but don’t want heat or the hot glass of gas models. We’re seeing strong growth in electric fireplace inserts.”
Johnson has experienced some push-back on electrics from hearth dealers that want to sell more expensive gas models. “But with the vast improvements in the looks and flames of electrics, hearth dealers are showing more interest,” he says. As part of The Outdoor GreatRoom’s Gallery Indoor division, the company is offering a line of Gallery series electric fireplace inserts designed for wood or gas zero-clearance fireplaces, the GI 29, GI 32, IS 36 and IS 36ZC.
Innovative Hearth Products (IHP) is “doing well” with its sales of electric models, says Glenn Thomson, vice president of Sales and Marketing. “Hearth dealers are not jumping into electrics in a heavy way. Many think it takes away their strong suits of technical expertise, installations and designer options for something that basically hangs on a wall. Electric fires have sales potential, but we don’t think it’s huge.”
Along with trends toward linear and larger units, Thomson sees a trend toward more features such as touch-screen controls and flush mounts with heat. New from IHP in both its Astria and Superior lines are two new linear models in 54- and 60-in. with thoughts of a future 72-in. and outdoor models.
|The Solo by Twin-Star.|
Classic Flame by Twin-Star is doing well with electric fires after a “big time” fourth quarter, according to Loren Thiessen, Media Communication specialist. Trends for the company include “low boy” entertainment centers that are lower to accept today’s bigger TVs above them. New from Classic Flame is a 42-in. electric fireplace with more flame effect and lighting under the ember bed, allowing the logs to glow with color. A new insert is designed to go into a wood cabinet, and a new Solo vertical tower electric heater with flame effect also includes speakers.
Chris Stammers, director of Marketing at the UK’s Dimplex, sister company to Dimplex North America, gave advice in the November, 2015, issue of the UK’s Fires & Fireplaces magazine to UK dealers that is equally appropriate for hearth dealers on this side of the pond. He pointed out that the UK electric fires market, where electric fires began, had recently seen a 16 percent sales growth.
“Electric wall fires (wall-mounted models) were up by an astonishing 45 percent as consumers take advantage of stylish designs and product innovations. In the case of wall fires, often thought of as a low-cost item best sold through the sheds (mass merchants), retailers should be aware that those that do focus on the higher ticket versions of such fires inevitably do well. High quality, ultra-realistic flame effects offer a chance for independents to add value and stand out against multiple retailers.”
The acceptance and sales of electric fires through North American hearth dealers are growing, albeit slowly. “Electric models have been real winners for us,” says Phil Schroeder, owner of The Fire Place in Palm Desert, California. “We’re selling three or four a week for an average of $1,700 each and twice as many as gas models. Most customers want a contemporary, linear fireplace but don’t like the big price of most gas models. Then they see the electric models with a realistic flame, requiring no permits, no Home Owner’s Association permission and requiring only easy installation, and they are sold.”
Schroeder is selling larger sizes, 55- to 60-in. and built-in models to mount a TV above. “Nobody cares about cabinet models,” he says. Schroeder had great concerns about mass merchants, so he sells only brands not available in the Big Box stores. “Electrics are the wave of the future,” he says, “particularly here in California where we’re faced with Net Zero in the California building codes in 2020.”
“Electric fires are a big thing for us,” says Tim Henry, Sales manager at Hearth & Home in Calgary, Alberta. “They offer a sale where you can’t run gas lines or where there are safety concerns with gas such as in condos and high-rises. Plus, they’re affordable. Five years ago we were selling one electric a month. Now we are selling 10 to 20 a month for $1,500 to $2,000 each and realizing 40 to 50 percent margins.
“The biggest evolution has been the wall-mounted linears where the customer can’t afford a $4,000 to $5,000 gas model. Consumers are asking about electrics, and we see electric fires as an opportunity that has blossomed.”
|The Gallery Collection electric fireplace insert from The Outdoor GreatRoom Company.|
“It’s a small percentage of my sales, but it’s increasing. Customers are requesting them, and it’s a growing category,” says Eleanor Butchart, owner of On Fire in Santa Rosa, California. “Customers are looking for the ambiance of a fire. They are not buying them for heat. They are looking for something fanciful – wall art – and they like the whistles and bells.”
Butchart’s commercial sales of electric fires are growing. “Restaurants and hotels like the safety of electrics plus the colors and back lighting,” she says. Last year Butchart replaced 24 wood-burning fireplaces with electric models in a large local inn. Gas was not available, and no-burn days meant they could not always use the fireplaces, so they often had to offer room rate refunds. “They are thrilled with the electric models. It’s a mistake to ignore this category,” she says.
But not every hearth dealer is having success with electric fires – so far. “Electric gets a lot of push-down from manufacturers, but the flow through is not what we anticipated even though we have strong presentations of electrics in our design centers,” says Eric Peterson, CEO of CAPO Fireside with five locations throughout Southern California. “It’s a category that has great exposure but very little pull-through in real dollars for us. Product development is moving along, but the consumer still has not bought in.”
Electric fires may not have caught on with all hearth customers and dealers, but manufacturers are counting on more of those two million units a year being sold by more hearth specialty retailers.