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Hearth & Home June 2018

Energy Distribution’s Tipi.

2018 Buyer's Guide – Hearth Data

Note: The estimate of hearth specialty retailers in the U.S. is derived from Hearth & Home’s circulation database. All other data are from recent surveys.

FAST FACTS

Hearth Specialty Retailers - U.S.

2,906

Specialty Retailer Gross Revenues – Hearth products and accessories

U.S.

<$25,000

9%

$25,000 - $149,999

17%

$150,000 - $499,999

13%

$500,000 - $749,999

9%

$750,000 - $999,999

13%

$1,000,000 - $1,999,999

11%

$2,000,000 - $4,999,999

1%

Percent of total hearth revenues represented by hearth accessories

12%

Indoor selling area (median sq. ft.)

4,235

Indoor selling area devoted to hearth products in season (median sq. ft.)

2,374

Percentage of retailers who opened a new store in 2017

1%

Percentage of retailers who plan to open a new store in 2018

1%

Average number of units on the

Floor (F) and Burning (B) F B
Wood-burning 15 3
Pellet-burning 6 2
Vent-free gas-burning 8 7
Vented gas-burning 18 14
Electric 7 6

Average number of years retailing hearth products

26

U.S. Sales of Hearth Products
Year-to-Year Sales Change
U.S. Sales of Hearth Products Year to Year 2005 to 2016

Following two dismal years, sales of hearth products roared back with a strong 11% increase.

Hearth Retailers’ Product Mix
Product Category % Retailers Selling
Hearth 54%
Hearth Barbecue 27%
Hearth Barbecue Patio 14%
Hearth Patio 5%

At 54% there are far too many hearth retailers who are not diversified.

Retailers’ Market Area
Retailers' Market Area

Sixty-three percent of hearth retailers work in a population area under 250,000 people.

Total Retail Sales for All Products
2017
TOTAL RETAIL SALES FOR ALL PRODUCTS

Fifty-six percent of hearth retailers gross between $1 million and $5 million.

Retail Sales of Hearth Products and Hearth Related Accessories
2017
RETAIL SALES OF HEARTH PRODUCTS AND RELATED ACCESSORIES

Thirty-nine percent of hearth retailers have sales of hearth products and accessories over $1 million.

Years Retailing Hearth
Years Retailing Hearth

Thirty-four percent of hearth retailers have been in business over 30 years.

Number of Retail Stores Operated
Number of Stores Operated

Nineteen percent of hearth retailers have more than one store.

Service Contracts
Service Contracts

For most hearth retailers (70%), a service contract has no appeal.

Outlook for Selling Hearth Products
Outlook for Selling Hearth Products

Sixty-eight percent of hearth retailers expect business to be better in 2018 than in the prior year.

United States
Wood Stove Sales
U.S. Wood Stove Sales

For wood stoves, steel remains the material of choice (56%), freestanding is still the preferred type (63%), and non-catalytic is the technology of choice (83%).

United States
Gas Stove Sales
U.S. Gas Stove Sales

For gas stoves, cast iron is the favored material (65%), fireplace inserts and freestanding units are equally preferred (50% & 50%), and direct-vent is the preferred technology (92%).

 

The four charts below show 2017 specialty retail sales to retail customers, new housing contractors, and remodeling contractors for the indicated products.

Wood Stove/Insert Sales
2017
U.S. Wood Stove and Insert Sales to retail customers, new housing contractors, and remodeling contractors
Wood Fireplace Sales
2017
U.S. Wood Fireplace Sales to retail customers, new housing contractors, and remodeling contractors
Gas Stove/Insert Sales
2017
U.S. Gas Stove and Insert Sales to retail customers, new housing contractors, and remodeling contractors
Gas Fireplace Sales
2017
U.S. Gas Fireplace Sales to retail customers, new housing contractors, and remodeling contractors

 

Percent of Hearth Business by Category at Retail
Percent of Hearth Business by Category at Retail

In the hearth specialty channel, sales of vented gas products have just about reached 50% of the market. Wood appliances represent 28% of the market, and pellet products 12%.

 

Retailer Primary Focus
Primary Focus

Forty-six percent of hearth retailers have yet to diversify, 23% sell hearth and barbecue, and 12% sell hearth, patio and barbecue.

Expected Purchases for the 2018 Season
Expected Purchases for the 2018 Season

Sixty percent of retailer hearth purchases occur in the last half of the year.


 

Fireplace Sales
(Included Add-ons)
Type of hearth product replaced

There appears to be only slight interest in fireplace surrounds (25%) and mantels (19% ) to accompany the sale of a fireplace.

Gross Revenue by Category
2017
Type of hearth product replaced

The average hearth retailer receives 72% of his/her income from hearth products; barbecue and “other” are the next main sources of revenue.


 

Average Price Point
Clean-burning Fireplaces $4,750
Pellet Inserts $3,765
Vented Gas Fireplaces $3,608
Vented Gas Inserts $3,442
Pellet Stoves $3,292
Zero-Clearance Fireplaces $3,052
Wood Inserts $2,876
Vented Gas Stoves $2,705
Wood Stoves $2,446
Vent-free Gas Fireplaces $1,717
Vented Gas Logs $1,346
Electric Fireplaces $1,108
Vent-free Gas Logs $915

Clean-burning fireplaces are the most expensive hearth products ($4,750), with pellet inserts ($3,765) and vented gas fireplaces ($3,608) in second and third place, respectively.

Overall Product Sales 2017
(compared to 2016)
Installation backlog days from 2010 to 2017

It was a good year for Vented Gas Fireplaces, Stoves, and Inserts, as well as Pellet Stoves.

Installation Backlog Days
2017
Installation backlog days from 2010 to 2017

Backlogged days usually peak in November. In 2017, the average hearth dealer was 17 days behind in that month.

Hearth Appliances Replacing Existing Hearth Products
2017
U.S. Wood Stove and Insert Sales to retail customers, new housing contractors, and remodeling contractors

In 2017, 36% of hearth product sales were to replace an inefficient wood fireplace, and 25% were to replace a pre-EPA stove.

Hearth Products Installations
How They Are Handled
Hearth Products Isntallations

The majority of hearth installations (66%) are handled by the owner or employees of the store.


 

Hearth Accessories
Percent of Hearth Revenues
U.S. Wood Stove and Insert Sales to retail customers, new housing contractors, and remodeling contractors

Twenty-two percent of hearth retailers receive over 10% of their gross revenue from hearth accessories.

New Installations vs. Replaces Existing Hearth Products
U.S. Wood Stove and Insert Sales to retail customers, new housing contractors, and remodeling contractors

Sixty percent of hearth product sales were for new installations.

More Industry Data

2018 August Business Climate

In early September, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, patio, and barbecue products, asking them to compare August 2018 sales to August 2017. The accompanying charts and selected comments are from the 196 useable returns.

» Continue

2018 July Business Climate

In early August, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, patio, and barbecue products, asking them to compare July 2018 sales to July 2017. The accompanying charts and selected comments are from the 193 useable returns.

» Continue

2018 June Business Climate

In early July, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, patio, and barbecue products, asking them to compare June 2018 sales to June 2017. The accompanying charts and selected comments are from the 216 useable returns.

» Continue

2018 May Business Climate

In early June, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, patio, and barbecue products, asking them to compare May 2018 sales to May 2017. The accompanying charts and selected comments are from the 219 useable returns.

» Continue