Not long ago, the Phoenix metro area was
home to 60 hot tub stores. Today there are less than 20.
Across the country in Washington, D.C., one of the area’s
largest spa retailers — Home Escapes — shuttered its
three-store operation in late summer after 23 years in
Dealers are closing shop in virtually every community
nationwide, reflecting a recessionary economy as well as an
industry in the grip of a steep, multiyear sales decline.
It begs the question: How are hot tub makers staying afloat?
“Honestly, I don’t know how a number of these
manufacturers have hung on as long as they have,” said Lauren
Stack, director of public affairs and industry promotion for the
Association of Pool
& Spa Professionals.
“The industry has bigger issues than just a lack of
available credit,” she added. “To emerge from this
successfully, you have to overcome the fact that you’re a
luxury item and a user of energy. Plus, I think retailers
aren’t committing the same kind of floor space to our
category anymore, and that lessens the exposure to the
Though statistics on unit sales are hard to come by, industry
experts estimate approximately 150,000 hot tubs will be sold across
the country this year. Compare that with 2004-05 numbers, which
topped out at as much as three times that figure, according to APSP
“If we dip below 100,000 units annually, I can’t see
where this industry can sustain 60 to 70 manufacturers,”
As for which companies could be most susceptible to a shakeout,
it all depends on who you ask.
Some believe the larger manufacturers are under more stress to
keep their businesses fit. Then again, the smaller, regional
players don’t typically have the same brand recognition or
local dealer relationships as their bigger counterparts.
“Ultimately, I think there will be fewer brands out
there,” said Jim Johnston, vice president of sales and
marketing at manufacturer Marquis Spas in Independence, Ore.
“We’re probably a year away from seeing some true
positive momentum, and there has to be immense pressure on a number
of manufacturers in terms of their cash flow. It’s not a good
situation right now.”
For their part, many dealers have reduced spa-heavy displays and
“We’ve known for some time that retail has been in
decline, and we see it in our market, too. It’s not a good
time to be a spa-only retailer,” said Brenda Murr, vice
president of Mermaid Pool, Spa & Patio in Anderson,
“It wouldn’t surprise me to see some product lines
disappear or some manufacturers go away,” she added.
“We’ve all had to rediscover our niches in this
A shrinking retail base puts more strain on manufacturers, and
the industry may not see positive movement for some time, even if
an overall recovery takes hold in the next six to 12 months.
“We’re a high-ticket, discretionary item, and the
credit market remains tight,” said Mike Dunn, vice president
of sales and marketing at Watkins Manufacturing in Vista, Calif.
“We could be lagging behind in that respect.”
“It’s a difficult climate,” he added,
“and there’s going to come a point where something has
to give. But it does feel to us that perhaps we’ve hit the
bottom, though it would be nice to see some stability.”