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Hearth & Home October 2019

2019 August Business Climate


July Sales

In early September, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, patio, and barbecue products, asking them to compare August 2019 sales to August 2018. The accompanying charts and selected comments are from the 182 usable returns.


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Weather Report

Consumer Confidence

Stock Watch


MONTH-TO-MONTH

RETAILER SALES – U.S. AND CANADA
August 2019 vs. August 2018

In August, 50% of Spa retailers, and 42% of Hearth retailers were UP; 31% of Patio retailers, and 21% of Barbecue retailers were also UP.


13 MONTH YEAR-OVER-YEAR RETAILER SALES
August 2019 vs. August 2018

In August, Spa retailers led the way with a 6% gain in sales, followed by Hearth retailers at 4%. Patio and Barbecue retailers trailed with a gain of 2% each.



Retailer Comments

Northeast

Connecticut: (Hearth, BBQ) “Up, up, up, business is back. But for how long?”

Massachusetts: (Hearth) “August was a good month. Massachusetts typically has a tax-free weekend which helps drive sales for the month.”

New York: (Hearth) “Sold the business! We are out of here and not looking back!”

New York: (Hearth, Spas) “Warm weather usually doesn’t sell hearth products, but this has been a very busy August for a change. Store traffic is up. In our showroom, I am no longer selling accessories such as hearth rugs, fireplace sets, ash vacs, and log hoops. The Internet sellers seem to have that market, and products such as these are held over year after year.
“The 2020 wood stove issue is somewhat of a fiasco. Can’t get product, and what we can
get is so much more expensive than before.”

Pennsylvania: (Hearth) “Cool evenings have increased foot traffic in the showrooms. Preparing for a busy fall season.”

Pennsylvania: (Hearth) “August was only down a little because we ran a promotion last year. Very good year so far.”

Pennsylvania: (Patio, Spas) “All OK, nothing exceptional.”


Weather Report

For the following weather charts, the numbers for each state reflects the temperature and percipitation rankings for the period since records began in 1895.

In August, Much Above Average temperatures hit the West Coast, Southwest, Florida and Delaware, in all, encompassing 11 states.

In the period from June through August, 9 states experienced Much Above Average temperatures.

In August, both Nebraska and Kansas reached Record Wettest status, while three neighboring states – South Dakota, Missouri and Oklahoma – experienced Much Above Average precipiation.

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South

Arkansas: (Hearth) “Disappointing retail month and YTD. Too hot and too wet for my products. Come on winter!”

North Carolina: (Hearth, Patio, BBQ) “New construction is very strong. Retail is better than average.”

North Carolina: (Hearth, Spas) “It does appear to me that, although the economy seems to be doing well, I do notice people being a little more conservative and thinking things through before any purchase.”


Texas:
(Hearth, BBQ) “Last year we had a surge in fireplace sales due to the flood. This year is more normal.”

Virginia: (Hearth) “We always get a kick out of when the hearth sales suddenly pick up. It’s always in the hottest part of August and continues through fall and winter – with the weather permitting.”

Virginia: (Hearth, BBQ) “The first open day in September has started off with a bang!”

Midwest

Illinois: (Patio) “As we started our floor sample sale to make room for our fall product, we found people ready to buy. The past few years our floor sample sale has produced only modest results. This year we have pulled product from every corner of the warehouse to fill the floor. On top of that, decks and patios are finally being completed after a very wet start to the season. Many wanted that instant gratification, but some opted to order the styles and colors they wanted. Our woven product was still the big seller for August.”

Illinois: (Hearth, Patio, BBQ) “I think we are still making up for a bad spring!”

Iowa: (Hearth, BBQ) “Flat builder sales. Remodel replacement up. Can’t find service or installers.”

Michigan: (Patio, BBQ) “The cooler temperatures have encouraged home and cottage owners to get construction and hardscape projects underway. Although affecting sales for this month, we look forward to future sales once those outdoor spaces are ready for furniture and accessories.”

Missouri: (Hearth, BBQ) “August heating sales were down from last August but, compared to 2017, it still shows an upward trend. The spring business was negatively impacted by excessive rain that persisted for weeks. Business has rebounded with the good weather as of late. Barbecue was severely impacted by the cool, wet weather. It also has rebounded but not enough to catch up to last year’s stellar sales.”

Ohio: (Hearth, BBQ) “August sales were relatively flat as we prepared for the upcoming heating season. We’re still benefiting from strong numbers in the first quarter. If the hearth season gets rolling early, we project at least a 20% higher finish to the calendar year than we’ve ever had. Bring on the Polar Coaster!”

Ohio: (Hearth, BBQ) “August sales volume was way up (almost double) over last year. We had a lot of early birds looking to upgrade their hearth appliances before the cooler weather arrives. We keep focusing on customer service, product knowledge, and positive staff attitude, and the results are undeniable! We’re looking forward to cold weather and a hot season here in Ohio!”

Wisconsin: (Hearth) “Strong retail and builder sales. Sales are below last year but 2018 was a phenomenon.”

Wisconsin: (Hearth, Patio, BBQ) “Store traffic very slow, sales continuing but down overall. Hopefully a bleak forecast for the upcoming winter will jostle people off their butts. A very wet spring has hurt contractor business as well. Low interest rates should perk up sales, but not as many new homes as of now. Contractors are baffled as well.”

Wisconsin: (Hearth, Patio, BBQ) “We can sell any job that comes into our store. High-end is in big demand. Multiple fireplaces in the home is now the norm. Have never seen this much new construction of second homes in 30 years. Gas products are really moving, but wood stoves have made a comeback in August. I could never have dreamt up this much business. Wow.”

Wyoming: (Hearth, BBQ) “Last year August was excessively busier than any August has been. It was no surprise we were down in sales this August from the previous one. Overall outdoor product sales have been low this year. I wish I knew the cause!”


Consumer Confidence

The Consumer Confidence Index declined marginally in August, following July’s rebound. The Index now stands at 135.1 (1985=100), down from 135.8 in July.

“Consumer confidence was relatively unchanged in August, following July’s increase,” said Lynn Franco, senior director of Economic Indicators at The Conference Board. “Consumers’ assessment of current conditions improved further, and the Present Situation Index is now at its highest level in nearly 19 years (November 2000, 179.7).

“Expectations cooled moderately, but overall remain strong. While other parts of the economy may show some weakening, consumers have remained confident and willing to spend. However, if the recent escalation in trade and tariff tensions persists, it could potentially dampen consumers’ optimism regarding the short-term economic outlook.”

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.

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West

California: (Hearth, BBQ) “Because of the rebuild in our area, sales continue to climb.”

California: (Hearth BBQ, Spas) “Walk-in traffic is slow but we are still booked until October. I think people are researching online then calling to set up an appointment; they are more know­ledgeable this year on the products. It’s going to be an interesting year.”

California: (Hearth) “2019 has been a great year; people are doing their homework, but we give them the knowledge to buy from us. Educate your customer so they can make an educated decision.”

Colorado: (BBQ) “Traeger and Big Green Egg are still hot. Green Mountain Grills’ Prime Series is coming on strong now that we have inventory.”

Oregon: (Hearth) “The weather was very mild last winter and has continued. My office did not complete the follow-up process for estimates and leads.”

Oregon: (Hearth) “We are rocking and rolling in August after a tough start to the year. Things are looking good heading into the season; our goal is to make up ground from the beginning of the year to finish even with 2018 (which was a record breaking year).”

Washington: (Hearth, Patio, BBQ, Spas) “It’s been a busy August.”

Wyoming: (Hearth) “Lack of qualified, skilled staff contributed greatly to lower numbers.”

Canada

British Columbia: (Patio, BBQ, Spas) “Pretty decent August, just shy of record sales for the month. We have exited the fireplace business to focus on outdoor products, and our renewed focus is starting to pay off already.”

British Columbia: (Hearth, BBQ) “Hearth product sales are consistently holding up to 2018 which was a very solid year. As a business in a very rural area, we have built a reputation for honesty and on-time delivery of quality products which has proved itself.”

British Columbia: (Hearth, BBQ) “Getting a hearth sale is taking lots of work; quoting multiple units then saying they are going to hold off — very indecisive customers. Feels like a recession is coming on! Hardly any interest in high-end barbecues this year.”

Ontario: (Hearth, Patio, BBQ) “It is what it is and ain’t nothin’ going to change it. It’s a Yo-Yo business, get used to it or go home.”

Ontario: (Hearth, Patio, Spas) “We have had surprising sales even with the rainy weather in our spring. Many returning customers with great references for new clients.”

Ontario: (Hearth, Patio, BBQ) “Sales of brand name barbecues continue to slow as specialty dealer selections are being absorbed by the Big Box stores. Manufacturers are looking at the big dollar orders and forgetting that the specialty shops are the ones they can depend on for quality sales and service of their products.”


Stock Watch

COMPANY – EXCHANGE SYMBOL 52 WEEK Week Ending % CHANGE MARKET CAPITALIZATION
    High Low 2-Aug-19 30-Aug-19 4 WEEK 26 WEEK 52 WEEK ($000,000)
Standard & Poor’s 500 (a) S & P 3,025.86 2,351.10 2,932.05 2,926.46 -0.2% 4.4% 0.9%  
HNI Corporation (b) HNI 44.79 29.90 33.06 31.19 -5.7% -19.1% -29.3% $1,340.00
Pool Corporation (c) POOL 200.00 136.83 188.91 196.38 4.0% 23.3% 19.6% $7,8450.00
Restoration Hardware (b) RH 162.10 84.11 115.60 130.78 13.1% -0.9% -5.0% $2,540.00
Wayfair, Inc. (b) W 173.72 76.60 127.31 112.74 -11.4% -33.6% -16.6% $10,410.00

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

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More Industry Data

2019 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 2019 sales to July 2018. The accompanying charts and selected comments are from the 206 usable returns.

» Continue

2019 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 2019 sales to June 2018. The accompanying charts and selected comments are from the 204 useable returns.

» Continue

2018 October Business Climate

In early November, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, patio, and barbecue products, asking them to compare October 2018 sales to October 2017. The accompanying charts and selected comments are from the 232 useable returns.

» Continue

2018 September Business Climate

In early October, Hearth & Home faxed a survey to 2,500 specialty retailers of hearth, patio, and barbecue products, asking them to compare September 2018 sales to September 2017. The accompanying charts and selected comments are from the 2,003 useable returns.

» Continue