The past few years in the pool industry has been a time of growth and exuberance. The nation was in the midst of a feverish housing boom, and pool builders were carried along effortlessly in its wake, the way cyclists will ride behind a leader to catch their draft.
But the cheerful sound of excavators has been replaced with the hushed voices of industry members asking each other: “How are you doing?” “How long do you think this will last?”
Smart, reputable builders are going under, and many of the larger firms are closing multiple offices. Until now, the super-wealthy — and the builders they hire — have remained relatively untouched by this terrible market. But the downturn is creeping up the economic ladder in many parts of the country as consumers face increasing problems getting home-improvement loans.
We’re no longer in a market correction. Many say we’re in a recession, though technically, they are wrong, (A recession is defined as “a decline in GDP for two or more consecutive quarters,” and that hasn’t yet occurred.)
But no matter what you call it, we’re on a rough ride.
The problem with boom times is that all the money lying around seems to interfere with people’s ability to think clearly. Over the past few years, consumers treated their homes like giant ATMs, and builders scrambled to keep up with them. Many in our industry ended up overstaffed and overextended without a plan for a rainy day.
Shortly before I sat down to write this column, I got a call from a homeowner on the East Coast. His pool had been constructed a few years ago by a well-known builder, and the man had been using the same company to service the vessel. He was calling me to get a recommendation for a different firm because the one he’d been working with was doing a terrible job. “They used to be great,” the man said. “But now, the guys who come out always complain about how they hate working there, and the customer service has really slipped.”
Though I didn’t say anything to the consumer, I have a good idea what happened. The builder had to lay people off and maybe cut pay, and as a result he’s stuck with a tiny, disgruntled staff. This is causing him to lose even more business, which means more cuts, and so it continues.
Reducing expenses takes the same foresight and business acumen as planning for growth. It also requires imagination and strong problem-solving skills. In these rough economic times, most pool companies have to make corrections to stay in business, but blindly cutting and hoping for the best is no better than the blind growth that preceded this.
The trick to cycling is to know when to use the draft created by the person in front of you, and when to break free from the pack and lead.
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