Growth spurt. When a local furniture store closed, Mainely Tubs stepped in, acquiring and remodeling the building, thus tripling its showroom and warehouse space. The move enabled the Scarborough, Maine, firm to add new products to its offerings, such as swim spas, commercial spas, gazebos, massage chairs. (Photo: Mainely Tubs)
It’s been a long time coming, but the U.S. hot tub sector seems to be coming back from a slump that preceded the Great Recession.
“Every market has seen some growth, even Florida,” said Bob Lauter, chairman of the International Hot Tub Association and CEO of Master Spas Inc. in Fort Wayne, Ind. “Now retailers are seeing the opportunity to expand with more stores or go into other markets.”
It’s a welcome turn of events for an industry sector that, according to some estimates, lost as many as one-third of its dealers in the economic downturn.
“Dealers are encouraged and can expand in a prudent way now,” Lauter said. “I see it as a healthy sign that the spa business will experience growth.”
Other industry experts would agree. Factors such as pent-up consumer demand and more bank lending are helping fuel market growth.
“There are sales upticks in regions where economic recovery is strongest,” said Scott Newton, past chairman of the APSP Retail Council and director of business development at Lawrenceville, Ga.-based BioLab.
Encouraged by the upturn, many spa retailers are going into expansion mode. Some are taking advantage of vacated stores to either relocate their operations to larger and/or more strategically advantageous spots — or add another store to their total number of locations.
For Jim Van Fleet, such a move tripled his showroom size. He acquired a 25,000-square-foot furniture store with a 9,000-square-foot showroom, as well as a bigger warehouse. After remodeling, he opened for business there in May 2015.
“We needed a bigger showroom … because we didn’t have enough room to display what we wanted,” said the owner of Mainely Tubs in Scarborough, Maine.
Having survived the worst economic crisis since the Great Depression has bolstered these retailers’ confidence, leading them to move boldly rather than timidly.
In Georgia, Leisure Lifestyles Pools & Spas is on a quest to become a major presence in the mid-Georgia/Alabama area, and plans to expand in the next three years for a total of six stores. It recently saw that a golf store chain was closing and acquired two of its locations. In March 2015, the Columbus-based spa retailer opened a store in Macon, Ga., and plans to open another in Montgomery, Ala., by early spring.
“For retail, [the golf stores] are pretty easy build-outs, and they’re loaded with slot wall, which [we] use,” said Jason Stewart, operations director.
Being strategically located makes a difference. Larry Staeb, general manager at Sunset Spas of Arizona, knows this well. To meet the needs of its clientele throughout the Phoenix area, his firm carefully spaced out its locations, with the flagship showroom in Chandler, an outlet in Glendale and, as of October 2015, a new store in Scottsdale.
Of course, there’s more to the recovery than bigger stores and strategic placement. The new retail landscape includes markets where so many stores have closed that there are voids. As Staeb puts it, “There were 50 hot tub companies [here] back in the day. Now there are five or six. It created a void, and we were able to hang on and when the market was right, fill that void.”
For recession survivors, exciting consumers with new products and technology has been key to recovery. Increased interest in swim spas has provided just such an opportunity.
Indeed, that’s one reason Van Fleet of Mainely Tubs wanted a large showroom. Now he has a 17-foot swim spa in a prominent spot on his floor.
And when Leisure Lifestyles introduced a swim spa to its selection, sales of that product soon hit the double-digit range, Stewart said.
All this bodes well for the future. Clearly, spa retailers are more confident and intend to take advantage of market opportunities.
