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Hearth & Home May 2016

Richard Wright
Hearth & Home Magazine

Perspective –
One Warm Winter

Before you read any more, go to the Business Climate and take a good look at the two temperature charts. The top chart is for the month of March only, and it shows temperatures throughout the country were either Above Normal or Much Above Normal. A ranking of 122 would have indicated the Record Warmest March since record keeping began in 1895.

No state set a record, however, just look at the number of states that came very close to doing just that.

Then gaze down at the bottom chart showing temperatures in the first quarter of the year (January–March). With the exception of Florida, once again every state was at Above Normal or Much Above Normal temperatures, and very close to setting a record.

It’s little wonder, then, that Patio sales in March were up 12 percent over sales in March 2015. That’s the fifth straight month that Patio sales have shown strong growth over the same period in the prior year. That wouldn’t be so surprising except that those five months take us right through the winter.

Now contrast that with sales of Hearth Products.

There’s little doubt which industry is benefitting, and will continue to benefit, from climate warming. Sales of Barbecue Products also received a boost from the warm winter, but not to the same extent as Patio Furnishings (see Business Climate).

What does this mean for specialty retailers? In the fall of 2015 and the beginning of winter, it meant an extended season for outdoor products. As the winter of 2016 came to a close in March, it meant an early beginning for sales of outdoor products.

How should retailers handle such disruption? Go with the Boy Scout motto and “Be Prepared.” Make sure you have a sufficient quantity of product in your warehouse, and on your floor. Don’t automatically remove categories from your advertising as the seasons change.

As seasons become extended – fall and spring, for example – certain purchases will make more financial sense to the consumer. The cost of creating an outdoor kitchen is easier to justify if it can be used nine months of the year rather than six. Make that case to your customers, and try to move them from the purchase of a cart grill to a full-blown outdoor kitchen.

If you’re a hearth-only retailer, then most likely you had a rough 2015 and an equally frustrating first quarter of this year. You should seriously consider bringing in counter-seasonal products. The past year was not an anomaly, as the past three months have clearly shown.

Early forecasts indicate 2016 will be a warmer year than 2015.

The knock against bringing in patio furniture is the amount of space needed to properly display an appropriate number of groups; the greatest positive is that upscale outdoor furniture is in great demand, and the margins are far better than with hearth or barbecue products.

The knock against barbecue products are that margins are far too low; the greatest positive is that the outdoor kitchen is the foundation of the Outdoor Room trend and, with a little creativity and proper demonstrations, barbecues can drive traffic to your store far, far better than either hearth or patio furniture.

The warming of the climate is a parade – get in front of it!

More Stories in this Issue

Determan Steps Down

By Richard Wright

After 21 years in the hearth industry, Brad Determan backs away to spend more time with family and to “get the hell out of the way” of his understudy.

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Berger Steps Up

By Richard Wright

VP Berger’s task is to protect and grow a half-billion dollar hearth business while navigating through the vicissitudes of weather, the economy, fossil fuel prices, and the ever-changing tastes of consumers.

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A Howling Success

By Lisa Readie Mayer

Only six years old, Coyote Outdoor Living has marked its territory as the sweet spot of $1,000 to $3,000 grills.

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Help or Hindrance?

By Lisa Readie Mayer

Most lifetime grill warranties are complicated, confusing and, say some industry members, just not needed any more.

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Outside & In

By Tom Lassiter

Industry veteran Bruce Erickson opens the first Summer Classics Home store selling both SC and Gabby.

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2016 March Business Climate

In early April, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, barbecue and patio products, asking them to compare March 2016 sales to March 2015. The accompanying charts and selected comments are from the 216 useable returns.

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