Page 1















1 0 Canada: An Introduction The Canadian economy appears to be doing well,

and the 15% tax imposed on foreign homebuyers in Vancouver seems to be having a positive effect.

1 8 Regulatory Challenges Greenhouse Gas (GHG) emissions, time-out periods, minimum efficiencies, and appliance registrations.

2 8 The Psychology of Customer Relations

At Marsh’s Stoves & Fireplaces, Alan Baroey and his employees work as a team, and everyone concentrates on the customers.

3 4 Not Too Bad Currency imbalance, Trump’s tariffs, the “Buy Canadian” movement – patio manufacturers are smiling, retailers not so much.



4 4 Lifetime Customers After 25 years with Beachcomber, Warren Yadlowski surely knows hot tubs; he also knows retailing and marketing very well.

5 2 Canadian I-Que Pizza ovens, built-in grills, and Outdoor Rooms are hot; Prop. 65 and tariffs are lurking.

6 6 Shrine of Barbecue In Ottawa, partners have created a retail juggernaut with in-depth staff training, great customer service, and a fun atmosphere – now they’re heading south (Florida?).

7 2 The Social Kitchen DCS by Fisher & Paykel, a luxury grill pioneer, is moving rapidly and smartly into the future.

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78 Industry News

82 Business Climate 85 88 89 90

Stock Watch Ad Index Who Reads Hearth & Home? Parting Shot



ON THE WEB News Trends in Student Loan Debt Forty Years of Bigger Houses


Recipes Broil King’s Maple Glazed Smoked Pork Belly Napoleon’s Homemade Apple Cider

18 On the Cover

Colorful and captivating St. John’s, Newfoundland.

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Publisher/Editor Richard Wright wright@villagewest.com Editorial only, send digital images to production@villagewest.com

Advertising Jackie Avignone, Director avignone@villagewest.com Melody Baird, Administrative Assistant baird@villagewest.com

Contributing Writers Lisa Readie Mayer, Tom Lassiter, Bill Sendelback, Paul Stegmeir, Dr. James Houck, Mark Brock, Kathi Caldwell-Hopper

Creative Services Erica Paquette, Art Director Kristin Gage, Sr. Graphic Designer April Brown, Jr. Graphic Designer Tobi Carter, Jr. Graphic Designer Susan MacLeod, Proofreader production@villagewest.com

Circulation Sheila Kufert circulation@villagewest.com Karen Lange lange@villagewest.com

Office Judy McMahon, Accountant mcmahon@villagewest.com

CopyrightŠ 2018 by Village West Publishing. All rights reserved. Reproduction in whole or in part without written permission is prohibited. All advertising is subject to approval by the publisher. Please address all correspondence to Hearth & Home, P.O. Box 1288, Laconia, NH 03247, (603) 528-4285, (800) 258-3772, FAX: (603) 524-0643. Hearth & Home, The Outdoor Room and Vesta Awards are registered trademarks of Village West Publishing. Village West Publishing is not associated with and has no financial interest in, the Hearth, Patio & Barbecue Association.

Hearth & Home (USPS 575-210/ISSN 02735695), Vol. XXXIX, No. 11, is published monthly by Village West Publishing, 25 Country Club Road, Ste. 403, Gilford, NH 03249/P.O. Box 1288, Laconia, NH 03247. Subscription price $36 per year; $60 (USD) in Canada; $120 (USD) overseas (first class, airmail only). Single copy price $15 (includes postage and handling) in U.S. and in Canada. Periodicals postage paid at Laconia, NH and at additional entry office. POSTMASTER: Please send address changes to Village West Publishing, Circulation Department, P.O. Box 1288, Laconia, NH 03247.

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| Perspective |

O Canada You had it coming, eh. You inflicted Nickelback on us. We did nothing. You sent us Justin Bieber. We “OCanada: turned the other cheek. You were responsible for one abomination after the other: Poutine. Diphthong vowels.

Hawaiian pizza. Instant mashed potatoes. Ted Cruz. Still, we did not retaliate – until now.” “Given Canadians’ well-known instability – their currency is called the ‘loonie’ – there can only be one solution: We are going to build a wall from Maine to Alaska – and Ottawa is going to pay.” — Dana Milbank, Washington Post columnist – joking, of course!


Total Received 348 25 hen the word “tariff” was first raised,Respondents all Are You Shunning U.S. Made Goods heads turned toward China. After all, in retaliation for President Trump’s tariffs wood, steel, Are You Shunning U.S. Madeon Goods Total Received 348 Respondents 25 in retaliation of President Trump’s tariffs on wood, steel, and aluminum? and aluminum? they’re the country that plays fast and loose with its currency, and treats other patents Are You Shunning U.S. Made Goods 10/25=.40 10 No 10 No in retaliation of President Trump’s tariffs on wood, steel, and aluminum? 15 Yes 15 Yes as if they were their own. 15/25=.60 But, nooo! Canada, not China, was the target of 10/25=.40 our 40% 10 No 10 No 15 Yes 15 Yes president’s first punishing tariff. It was a 20% tariff 15/25=.60 on 60% imports of Canadian softwood lumber, of which we bring in 40% approximately $5.66 billion worth every year. 60% Writing in Forbes, contributor Frances Coppola calculated that Trump’s “trade restrictions add an estimated $50 to $80 AreCustomers Your Customers Shunning U.S. Made Goods per thousand board feet to the price of lumber, which drives Are Your Shunning in retaliation for President Trump’s tariffs on wood, steel, and aluminum? U.S. Made Goods up costs and shrinks profits for lumber users. The resulting for President Trump’sShunning tariffs on wood, Are Your Customers U.S. Madesteel, Goods addition of $800 to $1,300 to the cost of a new home prices6/25=.24in6retaliation 10 No andforaluminum? No in retaliation President Trump’s tariffs on wood, steel, and aluminum? 15 Yes 19/25=.76 some 300,000 U.S. families out of the housing market, 19 Yes 24% denying them the dream of home ownership.” 10 No 6/25=.24 6 No 15 Yes 19/25=.76 19 Yes Since that time, tariffs on both steel (25%) and aluminum 24% 76% (10%) have been added, and Mexico and the European Union are now on the list. 76% Of course, the pain of these tariffs is being felt, not only in the States, but obviously in Canada. Both Company & Customers Shunning 60%

Which brings us to the “Buy Canadian” movement underway up north, and make no mistake, this is a movement that could (will?) have a very lengthy impact. Owners of hearth, patio, and/or barbecue specialty shops tell us that they, and their customers, are rejecting goods made in the States, and instead buying Canadian-made products. A survey recently conducted by Hearth & Home shows that 60% of Canadian specialty stores are shunning U.S.made goods in retaliation for the tariffs imposed by Trump. A greater percentage of their customers – 76% – are doing the same thing.

60% 50% Company & Customers Shunning In case you missed it …Both 60% 40% In 1995, director Michael Moore made 60% 50% 30% a movie titled “Canadian Bacon.” The You Shunning U.S. 40% premise was as follows: The U.S. economy 20% Customers Shunning U.S. 24% 30% You Shunning U.S. is in a rut, and so is the president’s approval 10% 16% 20% What is needed is rating. (Sound familiar?) Customers Shunning U.S. 0% 24% a good war, but Russia 10% (Vladimir Putin?) 16% is not interested. 0% “Hey,” says his chief of staff, “how about we invade that big, polite country to the north?” You can get it on Netflix; the premise is better than the movie. Bonne nuit et bonne chance,

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| 7

15 YES/Y 6 NO/NO 4 NO/YE 15 YES/Y 6 NO/NO 4 NO/YES

Summer collapses into fall... 2800 CRESTWOOD BLVD IRONDALE, AL 35210


1.8 6 6 .6 0 6 . 6 3 3 0

The Canadian Economy & Business |

AN INTRODUCTION The Canadian economy appears to be doing well, and the 15% tax imposed on foreign homebuyers in Vancouver seems to be having a positive effect. Richard Wright


t has been the second worse wildfire season in British Columbia. There were over 2,051 fires reported, and presently there are over 500 burning. The air in Vancouver has been worse than that of Beijing (and that’s saying something!). Airlines have had to cancel some flights due to lack of visibility in the area. As of Saturday, Sept. 1, 2018, more than 1,000 properties were under evacuation order, and 10,000 more were placed on alert. So far this season, over 1.252 million hectares have been burned in British Columbia – that equals 4,834 square miles. Ed. Note: We read a number of newspapers each day, plus three or four weekly newsmagazines and, at the beginning and end of each day, get news from CNN and perhaps a few other channels. Yet we had no idea of the extent of the problem being experienced by our friends in British Columbia, until we interviewed Martin Miles, CEO of Valor/Miles Industries, for this issue. Are we in the U.S. so parochial that we care little about our geographic neighbors?

Logging in the northern reaches of the country.

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The Canadian Economy & Business |

The past two years have marked the worst wildfire seasons in B.C.

A Canadian movement is in place and growing each day. It’s called “Buy Canadian,” and it’s the result of the U.S. president imposing strict tariffs on some Canadian goods – lumber, aluminum, and steel – and treating the Canadian Prime Minister, Justin Trudeau, with disrespect. In hearth, patio and barbecue shops throughout Canada, many owners are now buying only Canadian products. Why? Mainly because their customers will not purchase U.S. goods – at least for the time being.

MARTIN MILES CEO, Valor/Miles Industries Tariffs: “The U.S. and Canada are huge trading partners, and our economies have done well through a lot of free trade. I think, among Canadian consumers, there is a feeling of hurt about our perceived treatment especially since Canada’s trade is basically in balance. Overall, I think the U.S. benefits more than Canada when you consider services and goods. It is very balanced. It has worked out to everyone’s benefit. “I hear it among friends and acquaintances when they talk about supporting French’s ketchup instead of Heinz ketchup, issues like that. So there is a general awareness of where products

12 | OCTOBER 2018 | www.hearthandhome.com

are made, and supporting Canadian products. I don’t know that it has extended into the fireplace business, but in general there is a sentiment or concern.” Competition: “Things like the exchange rate of the dollar often affects the competitiveness of U.S.-made products in Canada, so when the dollar becomes stronger, the products tend to be more competitive. It is one of those top of mind things; it’s in the news and in the face of consumers.” Economy: “Right now it’s very strong in pretty well all sectors, and I guess that is the concern: Is there going to be Martin Miles. a downturn because of these factors. One of which is we’ve had this unrealistic, unforeseeable boom in housing, in prices and sales particularly in some of the major urban centers such as Vancouver and Toronto. There have been measures brought in to try to control some of the foreign buyers who are buying housing speculatively. That seems to be having an impact. “In Vancouver, a 15% tax was imposed on foreign buyers, and, particularly in the high end and even with some of the condos, it appears to be working. A lot of buildings were selling out two years before they were built.

“There has been an impact in sales in the last couple of months, and that is one of the things that everybody is watching, whether there is a retrenchment on housing prices and whether that will have an affect. Will consumers suddenly feel that their main asset is depreciating rapidly? Certainly we don’t have a bubble that is going to burst, but we may have a slowdown in housing that could have an affect on this business. “But currently, it is going very strong. Just finding employees is noticeably more difficult because the prime rates are low and the economy is currently very strong in most sectors. Currently, dealers are busy, and they seem to be anticipating going forward into the fall season and having a good year.” Zero Net: (Ed. Note: A year ago, there was great concern that natural gas would be eliminated from the Metro Vancouver area as the local government attempted to become one of the Greenest cities on the planet.) “That issue seems to have resolved into something that is workable. We have to credit the approach of the industry (Hearth, Patio & Barbecue Association Canada) in bringing awareness to the issue because some of the original proposals were not just floated, but almost instituted


“I don’t like the way the government is making choices for people without the general public being informed as to what it will mean for them.” — Laura Litchfield HPBAC

LAURA LITCHFIELD Executive Director, HPBAC Zero Net: “That issue now has spread beyond Vancouver, and into the entire Province of British Columbia (BC). The BC government has put out intention papers for comments regarding measures that would “electrify the Province.” They want to reduce or eliminate the use of natural gas for residential and commercial use. “That is a long-term goal, and it’s to please the Green Party which is the party that keeps them in power because it is a minority government. We (HPBAC) have provided comments against those measures. Now, nothing has been proposed yet as far as regulations. It’s more like strategic plans moving forward.

Monthly High/Low for U.S. Dollar to Canadian Dollar Spot Exchange Rate 2018


Exchange Rate

without consultation. A lot of people were very concerned. “Since then there has been an awareness campaign that the industry mounted, and it has had an affect; there have been many more consultations with the City of Vancouver and it has resulted in much more reasonable regulations, at least in the short to medium term. It looks like that issue has been resolved without any major damage or hardship to the industry. It really shows the value of engagement and dialogue. “We need to be proactive as an industry. We need to anticipate. We need to be ready to engage and be consistent with our solutions.”




1.275 1.25










Recently, the U.S. dollar has been worth around $1.30 or so in Canada. That’s a range that has been prevalent for many years, with a few anomalies.

Average Canadian House Prices – Provinces April 2017 to April 2018

Average House Price

12 Month Change

Saskatchewan Manitoba Newfoundland & Labrador Nova Scotia Prince Edward Island New Brunswick

$730,000 $578,000 $387,000 $297,000 $288,000 $296,000 $246,000 $249,000 $230,000 $178,000

0.2% -13.0% -4.9% 3.1% -6.5% 0.4% -3.7% 1.6% 18.4% 10.2%

Canadian Average


- 11.3%

Provinces British Columbia Ontario Alberta Québec

Average Canadian House Prices – Cities April 2017 to April 2018

Cities Vancouver, British Columbia Toronto, Ontario Calgary, Alberta Ottawa, Ontario Montréal, Québec Regina, Saskatchewan

Halifax, Nova Scotia Fredericton, New Brunswick Canadian Average

Average House Price

12 Month Change

$1,092,000 $766,000 $431,000 $382,000 $341,000 $276,000 $316,000 $173,000

14.3% -5.1% 0.1% 8.3% 6.3% -6.5% 2.4% 1.2%



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The Canadian Economy & Business |

Canada Unemployment Rate

“But now we’re not talking just about Vancouver anymore. We’re potentially talking about the Province of BC, and it’s not so much Zero Net anymore as it is eliminating the use of natural gas and other fossil fuels. I’m sure it would be a phased approach, beginning with new builds, but ultimately that is their goal. “At that point, electricity would be the only choice, and the Provincial government has approved the Site C dam in, I believe, northern British Columbia. That was very controversial, and will create a greater capacity for hydroelectric power in the Province. 6.3

“I don’t like the way the government is scale of the Site C dam that they are making choices for people without the proposing will have a major effect on GHG general public being informed as to what it emissions. And there are all kinds of other will mean for them. I believe that environmental effects as greenhouse gas (GHG) emission well. So jumping into a course reduction can be achieved of action without really through energy efficiency, and investigating the potential through conservation. I don’t consequences is not helpful. think they have given enough “In the short term, we time and effort toward figuring (HPBAC) have had success, out how to do it using current and we hope to have success infrastructure. in the long term as well. We “I have to believe that are encouraging people to vote building infrastructure on the Laura Litchfield. the Vision party out of office.”

Canada Unemployment Rate 6.2




6.1 6.0



5.9 5.9 Canada Housing Starts



5.8 5.7

Oct. 2017



Jan. 2018




Apr. 2018

Jul. 2018

As in the U.S., Canada’s rate of unemployment is extremely low, and the economy is doing well.

Housing: “From what I’ve been reading and hearing lately, a lot of people, in particular the Millennials, are giving up on home ownership. One of the major Toronto papers ran an article recently that said now renters are moving out of the city because rental fees have become exorbitant. “I live in a small town, and Millennials are struggling to buy homes there; the prices of homes are $300,000 to $500,000, and those homes are snapped up very quickly. There is usually a bidding war. It’s getting depressing.”

Unemployment by Province/Territory British Columbia

Province/territory Rate British Columbia

British Columbia

British Columbia British Columbia Alberta

Canada (national) British Columbia Alberta

Canada Housing Starts 260


Alberta British Columbia

British Columbia British Columbia Alberta


British Columbia Saskatchewan Alberta

Alberta Saskatchewan Alberta Saskatchewan


Alberta Alberta

Saskatchewan Alberta manatobia Saskatchewan

manatobia Saskatchewan

Saskatchewan Saskatchewan manatobia

231 219


5.8% 4.7%

Saskatchewan Alberta




British Columbia

Alberta British Columbia



Saskatchewan manatobia

Saskatchewan manatobia Ontario Saskatchewan manatobia Ontario


Manitoba manatobia Ontario manatobia Ontario manatobia


5.8% 6.2%

Ontario manatobia

Ontario Ontario Quebec manatobia


Ontario Quebec

Québec Quebec New Brunswick



Ontario Quebec Ontario

Quebec Ontario

Quebec Ontario




Quebec New Brunswick Quebec New Brunswick Quebec

New Brunswick New Brunswick Quebec

New Brunswick Quebec


Prince Edward Island New Brunswick


Prince Edward Island New Brunswick

(Numbers have been rounded.)

Oct. 2017

Jan. 2018

Apr. 2018

Jul. 2018

Nova Scotia New Brunswick Prince Edward Island

New Brunswick Prince Edward Island


New Brunswick Prince Edward Island Nova Scotia New Brunswick Prince Edward Island Nova Scotia

Prince Edward Island Prince Edward Island

Nova Scotia Prince Edward Island


Nova Scotia Prince Edward Island

Canadian seasonally adjusted housing starts decreased to 206,000 units in July of 2018 from a downwardly revised 246,000 units in June.

Prince Nova Edward Scotia Island

Newfoundland/Labrador Prince Edward Island NewScotia Foundland Nova New Foundland Nova Scotia

Nova Scotia New Foundland Nova Scotia New Foundland Nova Scotia New Foundland Yukon Nova Scotia New Foundland Yukon New Foundland Yukon New Foundland Yukon New Foundland Yukon New Foundland Northwest territories

14 | OCTOBER 2018 | www.hearthandhome.com

New Foundland Yukon Northwest territories Yukon Northwest territories Yukon Northwest territories Yukon Yukon Northwest territories Yukon Nunavut territories Northwest Nunavut Northwest territories



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The Canadian Hearth Business |

REGULATORY CHALLENGES Greenhouse Gas (GHG) emissions, time-out periods, minimum efficiencies, and appliance registrations. By Bill Sendelback


here’s a new movement in Canada; it’s called Buy Canadian. In reaction to recent U.S. tariffs and ongoing politics between the two neighboring countries, Canadian hearth product dealers are purchasing even fewer U.S.-made products, and many Canadian consumers are shunning U.S. products to buy Canadian. The Hearth, Patio & Barbecue Association (HPBA) no longer releases manufacturers’ shipment numbers by product category; that information helped industry members in tracking sales and spotting trends. Now only graphs are published, indicating very general trends. They also are released only to manufacturers who submit their sales data to the HPBA. However, most Canadian hearth product dealers “seem to be busy with good sales,” says Laura Litchfield, executive director of the HPBA Canada. “But there is a definite movement by Canadian consumers to buy Canadian products.” A modern coastal residence in West Vancouver. PHOTO: ©2018 LUKE POTTER, PHOTOGRAPHER / WWW.LUKE POTTER.CA. NELSONDESIGN, INTERIORS / WWW.NELSONDESIGN.CA. MICHEL LAFLAMME, COLLABORATION ARCHITECT / WWW.LAFLAMMEARCHITECT.COM. CLAIRE KENNEDY, LANDSCAPE / WWW.CLAIREKENNEDYDESIGN.CA. PL GEORGE CONSTRUCTION, CONSTRUCTION.

18 | OCTOBER 2018 | www.hearthandhome.com

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The Canadian Hearth Business | Canada Also Faces Regulatory Challenges While the hearth products industry in the U.S. continues to face environmental and regulatory challenges, such as the NSPS, Canada also has its own challenges, with individual municipalities and provincial governments, in addition to national efforts. Of particular concern is the Canadian national movement to address climate change, “and hearth products often

Vancouver’s Zero Emissions Building Plan strives to reduce emissions from newly-permitted buildings by 70% by 2020, and 90% by 2025. The law affects high rises of more than seven stories, but as of May 2018, the action now affects townhouses, residential buildings of less than seven stories, multi-family units, and single-family residences of more than 3,500 sq. ft. So far this action does not affect single-family homes of less than 3,500 sq.

The HPBA Canada and the HPBA are continuing their “Save My Natural Gas” campaign aimed at Vancouver residences in an effort to counteract Vancouver’s Zero Net regulations. get caught in the crosshairs,” says Litchfield. “Our current political climate recognizes climate change and is seeking to require provinces to address more than just air quality, but also reductions in greenhouse emissions, all supported by federal funding. The HPBA Canada, in conjunction with the HPBA, is working to identify challenges and react proactively.” A new version of the Natural Resources Canada amendment to the Canadian Energy Efficiency Act is expected to be published soon, with a probable implementation date of January 2020. Applying to vented gas fireplaces, stoves and inserts, the amendment would mandate a seven-day “time-out” period for on-demand pilots and a 24-hour time-out period for main burners – in short, banning continuous pilot lights. A “time-out” period is the length of time after which, if the unit is not ignited, it will be shut off automatically by the ignition system in an effort to reduce gas usage. The amendment will impose a minimum efficiency of 50% on heater-rated gas appliances, with no minimum efficiency required for decorative gas models. The province of British Columbia seems to be a hot bed of environmental regulatory efforts. The City of Vancouver’s Zero Net regulations are aimed at the elimination of greenhouse gases and the reduction of the city’s carbon footprint by curtailing the use of natural gas.

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ft. The HPBA Canada and the HPBA are continuing their “Save My Natural Gas” campaign aimed at Vancouver residences in an effort to counteract Vancouver’s Zero Net regulations. The Metro Vancouver, BC, area is introducing in its bylaws a law that wood stove owners must register their appliances on an annual basis. In an effort to eliminate the use of fossil fuels and reduce greenhouse gas emissions, the British Columbia provincial government has introduced and approved its British Columbia Energy Efficiency Act requiring energy efficiency testing and labeling for gas fireplaces manufactured through Dec. 31, 2018. Beginning Jan. 1, 2019, vented heater-rated gas fireplaces must have an efficiency rating of at least 50% and be so labeled. Vented decorative gas fireplaces must also have an efficiency-rating label but no minimum efficiency is required. Both heater-rated and decorative gas fireplaces cannot have standing pilots but must have pilot-on-demand, interrupted or intermittent ignition systems. Ontario’s new conservative government has canceled its cap-and-trade program for carbon emissions. However, it also canceled wood stove change-outs that would have been paid for with tax funds. Elsewhere in Ontario, the city of Ottawa is awarding $100,000 for a change-out program.

In Québec, the city of Montréal’s ban on wood-burning is becoming more strict. Affected wood-burning appliances are stoves, fireplaces, furnaces, water heaters, and zero-clearance fireplaces designed to burn wood logs or other “solid materials” such as coal. Restrictions now include no use during smog alerts, the appliance must be registered, and all use of the appliance must be stopped as of Oct. 1, 2018, unless the appliance is certified for a maximum 2.5 gph of particulate emissions. All solid fuel appliances can be used during power outages of more than three hours.

MANUFACTURERS It has been an exceptionally strong hearth products sales year for ICC Industrial Chimney Company, particularly in Canada, according to Dan Bonar, director of Residential Sales and Marketing. “All of our customers are seeing sales increases,” he says, “and people are buying more expensive products. Our Canadian economy is extremely strong with our GDP up 2.6% over last year, double what was expected, and all of the country’s economic numbers are up.” However, Bonar is concerned about the claims of “impending doom” for Canada’s economy predicted by some economists in part because of the recent U.S. tariffs. He notes that the recent housing booms in Vancouver and Toronto have slowed since the Canadian government put additional taxes on the sales of residential housing to foreign investors. “Now those foreign investors are looking at new areas such as Montréal,” he says. ICC’s U.S. sales also are up but not by as much as its Canadian sales. “The biggest issue is the 25% tariff we now pay when we ship our products to the U.S.,” Bonar explains. “We thought this might be a short term thing, so we did not pass that cost on to our U.S. customers. But recently we’ve had to raise our U.S. prices 5% to somewhat offset the tariffs.” New for ICC is its venture into woodburning grills. Its Bol brand grill in its Renaissance line is a high-end model retailing in Canada for $2,500. Even so, Bonar says Le Bol grill already is sold out. After a record sales year in 2017, first quarter 2018 sales fell at Kingsman Fireplaces, and the company is now

seeing a flat hearth products year, according to Dave Ivey, National Sales manager. “Our U.S. sales are up some because of new distributors we’ve brought on board. But here in Canada, consumers seem to be holding off on purchases, confused by the tariffs and the economic situation between our two countries.” Also driving some of the confusion, particularly for Canadian hearth product dealers, is the uncertainty of regulatory efforts affecting hearth products, such as the elimination of millivolt standing pilot ignition systems for gas models in British Columbia, and the concern that this will spread to other regions.

optimism.” Kingsman is less concerned about a housing bubble because it is not in the “down and dirty” builder market, but concentrates on custom homebuilders. “A surprise for us this year is the uptick in freestanding gas stove sales,” says Ivey, “so much so that we brought back one of our old models and upgraded it.” Hearth product sales have been “pretty strong” across the board for Pacific Energy Fireplace Products, says Cory Iversen, North American Sales manager. “We forecast a small increase, and we’re doing it. Our gas Town & Country brand is selling very well (and will show) a significant increase, but our Pacific Energy products are not doing as well. Our woodburners are showing a small increase.”

might affect them. As a result, many are moving to offer more Canadian brands.” Sherwood Industries is having a “very strong” sales year overall, but even stronger in Canada with a 34% sales increase up north, according to Cherbel Yousief, president and CEO. “We have not been very strong in Canada with gas fireplaces as we have concentrated on linear models, but we recently designed a new traditional model and that has taken off for us up here.” Yousief also says that Sherwood now is picking up larger Canadian dealers who in the past have paid little attention to the Enviro brand. Most of Sherwood’s sales growth is in gas hearth products. Pellet models are up about 11%, but wood-burning models are down 20%. “We focus on gas and pellets,” he says, “and wood for us is very small. We’re keeping up with overall demand this year, but next year we’ll have to increase our capacity.” Canada’s economy is “firing on all cylinders,” according to Yousief. “New home construction is booming – it’s insane – in Canada, particularly in British Columbia, Ontario, and Québec where the population is. We hear homebuilders cannot find enough workers and those who are available want at least $65 an hour. Dealers, too, are having trouble finding employees, and they are having to pay more than $20 an hour for those who want to work.” Fears in Canada of what may slow the economy, according to Yousief, are the recent U.S. tariffs that have affected product pricing to dealers, and a concern that interest rates may go up in an effort to slow an over-heated economy.

Housing starts in Canada are one economic indicator Iversen uses for his sales forecasts. “Housing starts in Canada are up significantly, and headed in the right direction for sales of hearth products,” he says. “And our economy is steady. We may see larger sales increases down the road, but I think they might be affected by the volatility of oil prices.” Iversen says that hearth product dealers believe that purchasing U.S. hearth products now is a “little bit risky. They are concerned about pricing two or three months down the road, and how that


Architectural Series from Town & Country.

“Our models already have been switched to IPI systems,” Ivey adds. “This is a huge concern because dealers don’t know what is allowed or how it will be enforced. There’s also concern that IPI systems do not perform well in very cold weather, and consumers don’t understand how to cope with these IPI ignition problems.” Ivey believes Canadians are “waiting for our housing-market bubble to burst. For three years analysts have been saying that this bubble will burst. Even so, our current economy is okay, and we’re seeing cautious

The Maritimes

Labrador, New Brunswick, Newfoundland, Nova Scotia, Prince Edward Island

Hearth products sales are “pretty good,” according to Zack Fisher, Sales manager of distributor Compact Appliances, Sackville, New Brunswick. “It’s been a busy summer for our dealers and they are optimistic about the season.” Wood-burner sales are strong for Compact as are gas appliance sales led by new growth in gas fireplaces. And pellet stoves are enjoying a “modest rebound.”

www.hearthandhome.com | OCTOBER 2018 | 21

The Canadian Hearth Business | Compact Appliances’ distribution area is quite rural compared to most of North America, according to Fisher. “These folks like their energy independence; hence, there are a lot of wood-burners.” The area’s economy has not been particularly strong for the past few years. The new home construction market is very small, and the area has some of the highest unemployment in Canada, Fisher says. A large portion of Compact Appliances’ product offering is Canadian made. “A lot of our dealers are looking to buy Canadianmade products, and consumers are asking for Canadian products.” Hearth product sales were “fairly quiet” through August for Brian Dingee, owner of Dingee’s Energy Systems in Centreville, New Brunswick. “Up until then, it had been hot and humid here, 30° C or 86°F, but sales now are starting to pick up.” With no natural gas in the area, propane has been the gas fuel. Pellet appliance sales have been stronger than sales of propane models, but sales of both pellet and wood models have dropped. “I think pellet sales will come back,” he says. Sales of minisplit heat pump systems (an Brian Dingee. efficient, electric powered heat pump system that can provide both air conditioning and heating into each room independently) are having a negative effect on Dingee’s hearth sales. “Dealers selling these products are popping up all over. And newer models now are more efficient, even with our colder winter temperatures.” The economy in Dingee’s area is “steady” with fairly low unemployment. “We’re in a rural area with farming, but also with manufacturing such as a big supplier of firetrucks and military vehicles, and a supplier of all the French fries bound for McDonald’s in North America. New home construction has tapered off with more used homes now on the market.” Dingee has not cut back on his purchases of U.S. products since he buys through local distributors. But he is concerned about price increases he expects in the late fall on hearth products. Hearth product sales have been steady, “about the same,” for Woodchuck Heating in Waterville, New Brunswick, says Arnold

22 | OCTOBER 2018 | www.hearthandhome.com

Culberson, vice president. “We’re in a more But we are just waiting for the cost impact rural area of smaller communities. Our of recent tariffs on U.S. models.” economy is flat, including housing starts, Murphy’s outlook is “very positive and and our population is not growing.” Wood optimistic. The world will rebalance itself. and pellet appliances are Woodchuck’s In the meantime, we are working on biggest sellers; sales of propane models marketing strategies to regain sales account for 10 to 15% of the company’s particularly for wood-burners.” total sales. “New homes are installing heat Hearth products are selling “really pumps for primary heating, well” at Corrigan’s Stove and mini-splits are cutting Center, Charlottetown, Prince into our hearth sales,” he Edward Island, according to says. owner Juanita Corrigan. “It’s For half of Culberson’s been an extremely good year, sales, the customer does not and we are quite busy, even come into the store. particularly selling wood“After 40 years in business burning, zero-clearance here, everyone knows us, fireplaces and propane-fueled so they simply call us and fireplaces.” New home place their order.” Most of Juanita Corrigan. construction has gone up in what Culberson sells are the area, and this, plus a Canadian-made products, stronger local and national economy, have and he promotes buying helped Corrigan see a 20% sales increase. Canadian. “We do get a very On the other hand, Corrigan’s grill sales few U.S. products through a have been “extremely slow, almost nonlocal distributor,” he says. existent,” she says. Culberson also tried selling The effect of the U.S./Canada currency grills, “but there were just no exchange rate seems to have slowed for sales for us.” Corrigan. “People appear to be accustomed Overall hearth product to higher prices for U.S. products after sales are down for Heritage the sticker shock last year, and some U.S. Hearth Products, Halifax, manufacturers have lowered their prices Nova Scotia, but sales of for us. Even so, we continue to sell a lot gas-fueled models have been “very strong of Canadian products, and now people and steady,” according to Gary Murphy, are looking to buy Canadian.” president. “But this has not been enough to offset wood-burner sales being off Ontario and Québec 20%, and pellet stove sales are almost Jacques Campeau, owner and operating non-existent.” manager of Campeau Heating in The economy is good in Nova Scotia, Sudbury, Ontario, says that while he sells says Murphy, but the increasing sales of mostly HVAC products, his hearth mini-split heat pump systems product sales are “holding on are having a big, negative but with no growth.” Located impact on his sales, especially in Northern Ontario, wood and pellet models. Campeau says his hearth “There’s a large marketing product business is basically effort underway for these only during four months of systems by the electric utilities the year, September through backed up by financing, December. “Wood-burning rebates, and other incentives.” is diminishing because of U.S. hearth products environmental concerns and the have always had higher Gary Murphy. work needed to feed and prices, so Murphy is not service them. We’ve been strong cutting back on or selling fewer U.S. in gas fireplaces for 20 years, they’re models. “Most of what we have always used for backup heating, and we’re now sold are Canadian products, and seldom seeing many of these being replaced with do our customers ask for Canadian-made. newer models.”

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The Canadian Hearth Business | But Campeau sees more sales growth in electric fireplaces. “This is a new market for us,” he says. “Used as third or fourth backup, electrics are being sold as room heaters. They can be installed almost anywhere, and they are less expensive than a wood or gas fireplace.” Campeau also is enjoying an increase in sales of fire pits. “With outside fires banned here, this allows a safe, controlled fire. And they are easy to use and relatively inexpensive as a focal point of a patio.” Campeau is a strong supporter of Canadian-made products. “The tariff issue between our two countries is unfortunate and has affected our hearth market,” he says. Hearth products are selling “really well” for Bob’s Woodburners & Fireplaces in Thunder Bay, Ontario, says owner Justin Santarossa. “Three years ago, gas product sales were up and wood-burners were my least selling category despite our company name. Now wood-burning, zero-clearance fireplaces are my top sellers because of renewed new home construction and an increase in vacation cottages. Sales of all of our hearth products are up, or at least on par with last year.” Ten years ago Thunder Bay was a mill town, and people were moving west to find jobs, says Santarossa. “Now we have a growing number of higher-paying, high-tech jobs, and folks are moving back.”

“We’re finding customers now are quite knowledgeable. They are well informed, know what they want, and as a result they will buy better, higher-end products.” — Tony Meli 4 Seasons Home Comfort

Santarossa tries to purchase only 20%, and we are expecting our biggest sales Canadian products, but surprisingly his year ever.” Located in the greater Montréal sales of two big U.S. hearth appliance area, L’Attisee sells mostly fireplaces and few manufacturers are up. And even with the if any wood or pellet stoves. exchange rate, he can be price competitive Montréal’s economy is “great,” says with these products. “But with the recent Quirion. “Unemployment is at a 30-year U.S. trade war, our customers are leery low, the cost of living is very, very low, of U.S. products and want to and downtown is booming buy Canadian,” he says. with lots of new construction.” L’Attisee in St. Hubert, Quirion sees the beginning of Québec, a suburb of Montréal, a real estate “wave” as real is having a “pretty amazing” estate investors move their hearth product sales year, searches from Vancouver and according to manager Marc Toronto to Montréal. Quirion. “With the recent Quirion is not necessarily changes to the Montréal law on cutting back on his purchases wood-burning, now allowing of U.S. products. “This models certified to 2.5 gph, disturbing political climate has legislation is now on our side. Marc Quirion. put us in a tough situation,” We are now selling more woodhe says. “We’re seeing price burning fireplaces than gas models, and the increases, and we’re crossing our fingers law is now requiring many consumers to that this tariff problem will go away in replace their old fireplaces with new certified two or three months. If not, we’ll have to ones. Our hearth product sales are up about make some tough decisions on our purchases. Now, however, if customers have a choice, in 99% of the cases, they will choose Canadian models.” Prairie Provinces

Alberta, Saskatchewan, Manitoba

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24 | OCTOBER 2018 | www.hearthandhome.com

“Our hearth product sales are pretty good – not crazy, but steady with a lot of retrofits of older fireplaces,” according to Tony Meli, manager of 4 Seasons Home Comfort in Lethbridge, Alberta. “People seem to be getting smarter, preparing earlier for winter with their purchases. We’re finding customers now are quite knowledgeable. They are well informed, know what they want, and as a result they will buy better, higher-end products.” Gas outdoor fireplaces are a particular sales bright spot for Meli. “But all woodburner sales are down by a small percentage, while pellet models have dropped off the face of the earth.”

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The Canadian Hearth Business | The economy in the Lethbridge area The West – British Columbia know what they want – cleaner styling is “very stable,” says Meli. “We’re a Hearth product sales are “fantastic, up 15 and higher efficiency.” farming and manufacturing community, to 20%,”says Rob Sidoroff, vice president The economy in Berger’s area is “good, and the ups and downs of the oil patch of Ark @ Home in Victoria, British no big changes, but getting a little bit better in other areas of Alberta don’t affect us. Columbia. “We have a very strong every year. People are spending money. We’re getting new factories economy here on Vancouver We’re not into new home construction, and support companies.” Island with people moving but we do a lot of retrofits.” Meli is not cutting back here from the mainland to get Berger always leans toward Canadian on U.S. manufacturers. away from the very high real manufacturers because of the higher prices, “We’re still selling U.S. estate prices in the Vancouver duties, and shipping costs of U.S. products. products from companies area – and perhaps to take “We have a lot of good manufacturers that want our business and advantage of the home equity in Canada, so we don’t need most U.S. are trying to help us,” he says. they have accrued.” That products,” she says. Customers are happy But some of Meli’s customers movement has resulted in an to see Canadian products in Berger’s are asking for Canadian increase in new construction showroom, she adds, but they are not products. “If they are looking of condos and townhouses in asking for Canadian-made. at two similar products, Rob Sidoroff. Sidoroff’s area. “But that is Comox Fireplace & Patio in Courtenay, they’ll buy Canadian.” for mostly low-end stuff,” he British Columbia, has always been Even though the economy has slowed says, “so we concentrate on custom busy selling gas hearth appliances, but in the Saskatoon, Saskatchewan, area, builders, and that business general manager Denise Kinsey Wheatland Fireplace’s hearth product is great.” recently has seen a “real influx” sales are “good,” according to manager Gas hearth products, in gas sales, particularly gas Steven Semeniuk. While farming is up, especially fireplaces and zero-clearance fireplaces and the gas and mining industries are down, inserts, are the big sellers for gas fireplace inserts. “We carry “but people seem to have become Sidoroff and are the bulk of a full line of wood and gas accustomed to it. They are now doing his sales increases. “This is not products, one of the largest more renovations. Home building is way a big wood market, and we woodstovelineupsonVancouver down, but we deal with high-end, don’t sell pellet stoves,” he Island,” she says. “But many custom builders, and that market is says. “Most of what we do sell consumers have questions coming back.” are Canadian-made products Denise Kinsey. about wood-burning with the Sales of gas hearth products for since we have a heavy supply perception that wood-burning Wheatland are up 5 to 10%, says of strong Canadian manufacturers in our will be banned. We tell them that this is Semeniuk, while sales of wood-burners area. But we are not cutting back on U.S. not true.” have almost stopped. “And sales of electric products, and so far customers are not Kinsey points out that one nearby village fireplaces have dropped to nothing, asking for Canadian models.” is considering banning wood-burning, one-tenth of our past electric Hearth product sales turned and she is concerned how that will affect sales.” Semeniuk says that on “like a switch” in late August, other communities if it’s not contained. two years ago products according to Michelle Berger, The economy in the Courtenay area is were presold even before Fireplace Sales manager for “really good,” Kinsey says. “Sky-high Wheatland took delivery. BC Fireplace Services, New housing prices in Vancouver and the Lower Westminster, British Columbia. Mainland are out of control. People can no “That came to a standstill last year.” “We were quoting jobs, but longer afford to buy there. We’re getting Semeniuk sees a trend nothing was happening. I went a huge influx of people moving here from toward more clean-faced on vacation in August, and when the Lower Mainland and even Alberta. fireplaces that can be dry I came back, all of a sudden So we’re selling a lot of gas fireplaces for walled up to the fireplace we had a lot of new business. new homes. Our housing values are up opening. “And interestingly, Michelle Berger. We’re gearing up for another 16% this year.” with today’s better insulated good hearth year after steady Kinsey is concerned about the recent new houses, people will pay for a better sales increases over the last eight years.” U.S. tariffs, the duties and freight costs of fireplace, but they want less heat output.” Gas fireplace inserts are selling U.S. products. “They are definitely affecting Semeniuk doesn’t worry about the “extremely well” for Berger. “We don’t our sales,” she says. “Even though we want to exchange rate since four years ago he get asked for pellet stoves, and our continue to buy some U.S. products, we are began purchasing predominantly sales of wood-burners have declined absolutely cutting back on U.S. purchases. The Canadian products. “And people want to less than 1% of our total. We are tariffs and the politics involved have brought Canadian products. Many are saying they seeing that customers will pay for up a level of irritation to our customers, will buy only Canadian-made.” high-efficiency hearth models. They so they want to buy Canadian.”

26 | OCTOBER 2018 | www.hearthandhome.com

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The Canadian Hearth Business |

THE PSYCHOLOGY OF At Marsh’s Stoves & Fireplaces, Alan Baroey and his employees work as a team, and everyone concentrates on the customers. By Bill Sendelback


ome might say you should have your head examined if you’re thinking about becoming a hearth product dealer. They might be right, but that didn’t slow down Alan Baroey, owner of Marsh’s Stoves & Fireplaces in Toronto, Ontario. In fact, he actually was a psychologist before becoming involved in the hearth products industry, and skill learned then may have helped him be successful in his second career. For the past nine years, Baroey has enjoyed annual sales increases of 15% to 20% (meaning Baroey has more than quadrupled his business in that time period). Marsh’s is truly a hearth product dealer with 99% of its sales in hearth products, including wood and gas stoves, fireplaces and inserts, electric fireplaces, glass doors, and gas logs. The store doesn’t carry

28 | OCTOBER 2018 | www.hearthandhome.com

patio products and very few grills. About 85% of Baroey’s hearth product sales are gas burners, and almost 15% are wood-burner sales. “I don’t have the showroom space to properly display patio and grills,” Baroey explains. “We do sell maybe a half dozen high-end grills a year, but most grill sales in our area go to the barbecue people whose main business is grills. “My business philosophy is based on being honest and transparent,” Baroey says. “We’re dealing with explosive fire in someone’s home; we’re dealing with people’s lives, their investment, and their family. We need to be honest and transparent to earn people’s trust by moving them toward the products they need and want and then educating them on how to use that product safely.

L to R: Richard Fitzsimons and Alan Baroey.



With about 30 hearth brands in the store, and only 3,500 sq. ft., Marsh’s somehow allows inviting space for its customers.

Click here for a mobile

friendly reading experience www.hearthandhome.com | OCTOBER 2018 | 29

The Canadian Hearth Business | “As a psychologist, I want every experience with us to be positive so that the customer will recommend us. They need to feel trust in us, a trust we must nurture. Many retailers don’t understand the importance of nurturing customer trust, the basis of my business since day one.” Marsh’s was launched in 1948 by the Marsh family as a hardware store. In the mid-50s the store shifted from hardware to wood stoves, eventually selling across Canada, and warehousing as many as 600 wood stoves. In 1979, Baroey’s father-inlaw, Richard Fitzsimons, and Baroey purchased Marsh’s as an investment and kept the Marsh’s name. “Neither of us had any experience at all in the hearth products industry,” he admits.

has been recession proof,” he says. “No matter how badly the economy may do, people in our area still do renovations and still need fireplaces. Since we deal with higherincome consumers, they can still afford it.” The economy in Baroey’s market is “moving along beautifully,” he says. “This market is still going up, and I don’t see any slow-down. The prices of real estate are rising annually at a rate of 15% to 20%, so the market here is incredibly high. “We are not price beaters. People ask, ‘Are you price competitive,’ and I say, ‘No, we’re not. But we’re fair.’ I have a lot of competition, but I do my best and don’t worry about them. I sell based on confidence in our products and in my

Electric fireplaces are well displayed at Marsh’s.

While co-owning Marsh’s, Baroey went to college and graduated in 1984 with a degree in psychology. “After graduation, I couldn’t find a job, so my father-in-law suggested I try working in the store. I told him I’d try it for a couple of months, and now it has been more than 30 years and I’m still here.” In 2009, Baroey purchased his father-in-law’s interest and is now sole owner. Baroey’s market area is the greater Toronto area, but 80% of his business comes from the more affluent downtown core. His customers tend to be well-paid, white-collar consumers. “For some reason our business

30 | OCTOBER 2018 | www.hearthandhome.com

people. Once you sell based on price, you’re a loser. Once you educate the customer and have earned their trust, price is not a focus.” Baroey works with custom homebuilders, but not tract builders. Using his showroom to sell builders, designers, architects, and their customers, each of his floor salespeople has his or her own clients. “When a builder, designer or architect comes in the door, he already knows whom to deal with.” The entire staff at Marsh’s is on salary, none on commission. “Although a builder or customer may know whom to deal with,

“I insist that when anybody walks in our door, one of our staff must, within a few seconds, greet and engage him or her.” — Alan Baroey

anyone can pick up a job or client to promptly get them an answer or take care of anything needed. “Everything is transparent in our system and how we work,” he says. As a part of taking care of the customer, “I insist that when anybody walks in our door, one of our staff must, within a few seconds, greet and engage him or her.” Baroey has a full-time staff of 20 with some, such as Austin Lounsbury, having been with Marsh’s for 44 years. “My people are my strength,” says Baroey. “They are the one thing I value more than anything else – people whom you can trust.” Like many business owners today, Baroey has trouble finding people who want to work. “We interview people, put them through rigorous testing to see how they will treat customers, and 90% of them are not worth hiring. So the people I have are as good as gold to me.” Marsh’s does its own service work and installations with in-house employees. “I don’t sub anything out. We do everything in house,” Baroey emphasizes. “And everything we do makes us profit.” But “profit” to Baroey does not always mean money. “It’s a profit for us when my service guy promptly visits a customer and takes care of a problem. The idea of monetary profit comes secondary to being able to deliver products to the customer as promised, and to take care of any service. I can’t always put a dollar sign on that. I want our customers to feel that they have been served appropriately, trusted and looked after.” Most of Baroey’s purchases are dealerdirect and that includes a long list of hearth product manufacturers coming from not only Canada and the U.S., but from all over the world. “The exchange rate and

the tariffs are huge hits for us, but I’m not moving toward Canadian manufacturers. I will sell what the client wants, and the dollar sign doesn’t mean anything.” Baroey does have some consumers asking about Canadian products. “I don’t make any bones about where our products come from,” he says. “It really is the product design, what the customer wants, and what is suitable for him that counts.” Based in the original 1948 location of Marsh’s, today Baroey has two adjacent showrooms totaling 3,500 square feet. His original 1,500-square foot main showroom features wood stoves, electric fireplaces and glass doors. After purchasing Marsh’s, Baroey turned his then warehouse into an additional 2,000 square foot showroom now featuring wood and gas fireplaces and gas stoves, both showrooms with multiple burning models. “We built our showrooms ourselves,” Baroey says, “and they are like revolving doors. We change all our displayed products every five or six years because new products are introduced and our customers’ tastes change. We don’t have a fancy showroom, but we really do well on our displays, and we don’t want our showrooms to look stale.” He offers a display and product suggestion to other dealers. “If you are displaying or warehousing products that you have not moved in two years, it is time for you to put a ‘sale’ sign on them, get rid of them, and display something new.” Baroey’s advertising is a little unconventional for hearth dealers. He spends 2.5% of his gross sales on advertising. Gone are traditional radio and television spots, newspaper ads, and all but a few Yellow Page listings with no display ads. Most of Baroey’s money, 80%, is spent on Google Internet ads and Marsh’s website. The remainder is spent on ads in small, designer books in the “really” affluent areas of Toronto, Baroey says. “People go online and then come in to shop and say, ‘We saw you online and read your reviews.’ Our customers also go online, sometime to talk about us, and we hope happy with our service. But no advertising can pay me back as much as a satisfied customer. We want our customers to say to their friends, ‘Marsh’s is where you need to go.’”

With sales continuing to increase, Baroey is planning to expand his operation. “We’ve been looking for the last five years for a larger facility so we will have enough room to add and display outdoor living products such as grills.” He adds that downtown Toronto is a “miserable place to find property. It could be worth as much as $15 million to $20 million dollars! “If you are going to get into this business,” Baroey advises, “you must know how to install, be a gas fitter, and be certified for wood-burners. You will not

be selling just an appliance. You will be selling something that brings fire into a customer’s home, so you have to know how to install it safely.” Putting on his psychologist’s hat, Baroey says, “You have to be a people person and be able to sit down and face problems. You have to be able to listen to homeowners, builders, and designers, and be able to satisfy everyone without insulting anyone.” Sounds like advice most of today’s politicians should heed.

Store Name: Marsh’s Stoves & Fireplaces

% Gross Sales by Product Category: Hearth: 99% Barbecue: 1%

Address: 3322 Dundas Street, West, Toronto, ON M6P 2A4 Number of Stores: One Owner: Alan Baroey Key People: All 20 employees including Robert Sherk, office manager, and John Morton, operations manager Year Established: 1948 Website: www.marshsfireplaces.com E-mail: alan@marshs.ca or info@marshs.ca Phones: (416) 762-4582 and (800) 906-5557 Fax: (416) 762-0345 Number of Employees: Full-Time: 20 Part-Time: 0

Square Footage: Showroom: 3,500 Warehouse: 8,000 Product Lines Carried: Hearth: Amantii, Astria, Bellfires, Dancook, DaVinci, Dimplex, Enerzone, Fires of Tradition, Hearth & Home Technologies, HearthStone, ICC/RSF, Jøtul, Kingsman, Montigo, Morsø, Napoleon, Ortal, The Outdoor GreatRoom Company, Pacific Energy, Rais, Regency, RH Peterson Co, Selkirk, Skytech, Spartherm, Stoll, Stûv, Travis, Valcourt, Valor, Wittus Barbecue: Twin Eagles % of Annual Gross Sales for Advertising: 2.5%, Internet and social media, 99%

www.hearthandhome.com | OCTOBER 2018 | 31

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The Canadian Patio Business |

NOT TOO BAD Currency imbalance, Trump’s tariffs, the “Buy Canadian” movement – patio manufacturers are smiling, retailers not so much. By Tom Lassiter


anadian patio furniture retailers who want to “Buy Canadian” may choose from heavyweight vendors with international clout to young companies seeking their niche in a world of outdoor lifestyle choices. Among the best-known brands are Ratana, CabanaCoast, and CR Plastic Products, pioneer in building outdoor furniture in North America from lumber-like material made from recycled milk jugs and other high-density polyethylene (HDPE) materials. These three companies sell their products throughout Canada and the United States. At the other end of the spectrum are casual furniture manufacturers with more limited product lines and more limited distribution. More than a few produce classic Muskoka chairs and related products in wood or plastic lumber. (A Muskoka-style chair is a look-alike cousin to Adirondack chairs, see photo.) Here’s a look at three Canadian casual furniture outfits.

Two of Willow Green’s Muskoka-style chairs flank a handcrafted steel fireglobe from Horizon Metal Works.

34 | OCTOBER 2018 | www.hearthandhome.com


Click here for a mobile friendly reading experience www.hearthandhome.com | OCTOBER 2018

| 35

The Canadian Patio Business |

MANUFACTURERS Willow Green We’ll call Willow Green a hybrid; it’s part retailer and part designer-manufacturer. The company is based north of Toronto in Bethany, Ontario, and presents products online at cottagechairs.ca. Beginning in 2010, the company stopped dealing in wood furniture and limited its products to HDPE. Willow Green is owned by Darryl and Tammy Irwin. Five different manufacturers of HDPE casual furniture supply Willow Green, including CR Plastic Products and Krahn, which makes Muskoka-Adirondack style furniture. Darryl Irwin. The Irwins designed about 25% of the products in Willow Green’s current lineup of some 140 items. Krahn produces three chairs designed by the Irwins, and Amish craftsmen in the United States make other products. “We have very close relations with our builders,” Darryl Irwin says. “We can turn around a new product in less than two weeks, from prototype to production model. As the manufacturers of poly lumber evolved, we were able to evolve as well.” CabanaCoast CabanaCoast, launched in 2002, has been selling its products through U.S. retailers for about six years. The company has a permanent showroom in the Merchandise Mart.

Cove by CabanaCoast.

36 | OCTOBER 2018 | www.hearthandhome.com

“In Canada, we’re an established brand,” says Lindsay Liepold, director of U.S. sales. “We’re still very much the new kid on the block” in the States, she says. The company has about 185 dealers in North America, but does not yet have a presence in every U.S. state. CabanaCoast’s frames are made in China, the country of origin of its Canadian owners, David Wen and Catherine Peng. Cushions are made to order at CabanaCoast’s headquarters in Mississauga, Ontario. The company prides itself on being a quick-ship, special-order manufacturer. “That’s where our niche is,” Liepold says. It maintains in Ontario a heavy inventory of all frames and more than 200 fabrics by Sunbrella and Tempotest. “None of our soft goods are premade,” she says. “We make it all to order in Mississauga. We’re about as close to just-in-time as you can get in this industry.” Product usually leaves the warehouse two to three weeks after an order is placed, she says. The capacity to make custom cushions and ship rapidly from its Canadian warehouse to any retailer in North America gives CabanaCoast its market advantage, Liepold says. “Designers love us because our fabric people are so capable,” she says. The company also focuses on the hospitality

industry and has sold to clients including Marriott, Hard Rock Café, and Sandals Resorts. Liepold says CabanaCoast has continued to grow its Canadian sales in recent years despite a slowdown in the housing market. Skyrocketing home prices have made things extremely difficult for first-time buyers and for condo owners who want to make the move to a singlefamily home. “If everybody’s spending more for their house,” she says, “that leaves less money for luxury items, such as higher-end patio furniture. We’ve had dealers that have had great growth this year; we’ve had dealers that are a little flat this year.” CabanaCoast sells into the United States in U.S. dollars at a landed cost, with no additional fees for brokerage. The company subsidizes freight on shipments to U.S. retailers. The recently published price list for 2019 did not reflect an acrossthe-board price increase, Liepold says. Prices on a small number of select items were adjusted. Talk of a Canadian/U.S. trade war adds some uncertainty to how solid those prices will be in the coming months, she says. But for now, a stable price list is “definitely a big talking point.” CabanaCoast’s products include resin wicker, stainless steel, aluminum, and faux teak. Styles include some traditional items but are mostly transitional and contemporary. Liepold calls the contemporary look “our design aesthetic, because Toronto is a very contemporary market.” She says the company is having success with mainline furniture stores that don’t typically warehouse product. CabanaCoast’s ability to customize and ship product rapidly “fits right into their wheelhouse as far as what they’re comfortable with.” Ratana Vancouver-based Ratana in 2018 marks 40 years in business. That’s a major source of pride, says Joanna Leung, vice president of Business Development and a secondgeneration member of the founding family. She describes Ratana as “an international brand with Canadian roots.” Ratana has responded to the slackening of demand for resin wicker products in

North America by developing products that integrate new materials such as rope and hand-brushed aluminum. “We cater to the different tastes and desires of our customers,” Leung says. “We’re offering a more varied line than in the past.” The 2018 season got off to a somewhat slow start, she says, but sales picked up as the year progressed. “We had a good premarket, and we are excited for the coming season,” she says.


Element 5.0 from Ratana.

The Maritimes

New Brunswick, Newfoundland, Nova Scotia, Prince Edward Island

year” with its one line of casual furniture. Part of the appeal of CR Plastic Canada’s short casual furniture season is Manager Tony DeLuca said products by furniture, Wyntjes said, is that it is especially abbreviated in the Maritime CR Plastic Products have been sold for Canadian-sourced and made to order. But Provinces. Some shops contacted in late more than a decade. the brand’s popularity backfired this August were already shuttered for fall. “We’ve had a lot of luck with CR season, he said, with the introduction of a Stores in the Maritimes that offer casual Plastics,” he said of the new collection called Harvest furniture typically deal with a limited company based in Stratford, and a new deep-seating number of suppliers and don’t buy deep. Ontario. “We seem to have swivel rocker. CR Plastic Steve Clark owns Simply Furniture, a increases every year.” couldn’t keep up, he said. full-line furniture store in St. John, New MacArthur’s Nurseries has “They bit off more than Brunswick. He called casual furniture a attempted to bring in cast they could chew,” Wyntjes “hard to sell product.” aluminum, teak, and resin explained. Product that used Shoppers at Simply Furniture don’t wicker furniture in years past. to arrive in three to four have to take sides in Canada’s current trade “But we never had a lot of luck weeks took “eight weeks or spat with the United States. They don’t selling that stuff,” DeLuca said. even longer” this season. have a choice. All the furniture at Simply CR Plastics’ heavy, durable Andy Cotnam. “We had big delays in Furniture is sourced from Canada. furniture made of highgetting stuff to our Clark offers only one brand of patio density polyethylene (plastic lumber) suits customers,” he said. furniture: CabanaCoast. Most of his the area’s coastal environment, he said. “It Casual furniture accounts for between customers tend to be designers, he said, doesn’t blow around,” he explained. “You 5% and 10% of sales at Sunpoke. “because of the nature of its cost.” Tickets of can leave it outside for the winter.” Despite the delivery issues, Wyntjes was $10,000 and up are not unusual. Casual furniture sales make up about pleased with how the patio season played Even so, Clark said casual furniture 3% of the garden center’s annual sales, he out. Sales were “much better than last represents only about 5% of his said. year,” he said. “It was cold then.” annual sales. CR Plastic Products also It’s a similar story at Style is the only casual furniture Ontario and Québec 52, a design-oriented furniture line at Sunpoke, which also The casual furniture business can be, oh, store in Halifax, Nova Scotia. sells hearth and barbecue so fickle. Sales consultant Ray Palmer said goods in Hanwell, near If you’ve any doubt, just ask Andy the shop carries only Ratana, Fredericton, New Brunswick. Cotnam, president and general manager showing a few items on the floor Rhett Wyntjes purchased at The Fireplace Center & Patio Shop and placing special orders. the more than 40-year-old in Ottawa. “Ratana is quite expensive,” business two years ago. He “Last year was a really wet summer. he said, “so we don’t sell a lot Rhett Wyntjes. quickly learned that the bulk We had our best furniture year ever. We of it.” Casual furniture, Palmer of patio sales are made from were up about 30%. That makes no said, “is just a small piece of our market.” April through June before tapering off in sense,” he said. “This year, it’s been a MacArthur’s Nurseries in Moncton, July and August. A few early birds shop in beautiful summer, and our sales are down New Brunswick, enjoyed “a very good March, he said. about 20%.”

www.hearthandhome.com | OCTOBER 2018 | 37

The Canadian Patio Business | With two stores serving the nation’s ship product this season. “That’s very good for us,” capital, Cotnam figures his annual sales Delivery added another week she said of the construction are down about 10% as of late August. to the process. boom. Paul Anderson, general manager of Delays hurt, he said, Lake Livin’ and The Patio Comfort in Ottawa, said weather because Québec’s selling Boathouse, located in issues early in the year caused sales to stall. season is two to three weeks Cottage Country two hours That lost momentum has been felt shorter than in Ontario or north of Toronto, might just throughout the year. “It’s hard to catch British Columbia, which lie be the most unusual casual up,” he said. farther to the south. furniture operation in North Ottawa businesses may have suffered In Montréal, Karoline America. a bit because of a snafu in the government’s Trudeau enjoyed her first Karoline Trudeau. The two shops are part of paychecks to federal employees. Some season as owner of Boutique Port Sandfield Marina, went for up to six months without pay Le Balconier, an established shop. She which, as the name implies, serves those because of software problems in a new purchased it while the business was closed who can afford to ply the waters of the payroll system, Cotnam said. Other for the winter (as usual) and reopened the Muskoka Lakes. The dwellings lining the employees were overpaid. Cotnam store in March. shores are second homes. suspects some government Warm weather teased “These cottages, if you can call them workers just stopped Montréal for two weeks in that, go for $2 million and up,” said Nada spending while waiting for March before frosty Blair. She and husband Jonathan preside the payroll issue to be temperatures returned. “It over the family-run business now in its resolved. took a bit of time to get that fourth generation. In Lachine, Québec, summer vibe,” she said. Lake Livin’, open year-round, offers retailer JML Inc. was off The shop specializes in casual furniture by Telescope, Lane even more. Owner Jean-Marc smaller-scale furniture for Venture, and Summer Classics. “We deal Legault said sales were down Montréal’s high-rise condo with the elite, the wealthy of Canada,” about 15% from 2017’s pace. and apartment dwellers. Blair said. “We have to have high-end Legault put the blame on Jean-Marc Legault. The boutique’s 2,000 sq. ft. product.” a late spring. The summer, showroom features 10 terraces The Boathouse sells a wide variety of when it finally arrived, was great, he said, of various sizes outfitted with resin wicker, goods including home décor items, gifts, but “we didn’t catch up.” aluminum, and synthetic wood furniture. outdoor throws, patio heaters, and Complicating matters for JML were A typical three-piece sectional retails barbecues. Merchandise is just steps away shipping delays from a major U.S. supplier. from $2,000 to $4,000, she said, and from two slips where classic inboard His store deals only in special orders, she’s looking forward to a profitable watercraft (also for sale) are a main Legault said. He said Telescope, which first year. She expects the expanding attraction. The Boathouse closes for the usually ships product in two to three condominium market to drive her casual season after Canadian Thanksgiving weeks, often required four to six weeks to furniture sales. (October 8 this year). Lake Livin’ stays open throughout the winter. Even though the lakes are hard frozen, Blair is prepared to serve clientele who may have purchased a property in the off-season and want to ready it for summer fun. Cottages, by the way, come with boathouses, which are not just for boats (usually at least three, Blair said). Boathouses also serve as guest houses, with quarters typically on the second level. Cottage owners make excellent customers. “I sell them furniture for the boathouse, for the decks, plus the main cottage,” Blair said. “They need a lot of furniture. “We work seven days a week in season,” she said. “But it pays off. We do very well.” Many retailers found it more difficult Adirondack MGP Sling Chairs from Telescope Casual Furniture. to sell casual furniture sourced from the

38 | OCTOBER 2018 | www.hearthandhome.com

United States this year. The unfavorable exchange rate made it “a real problem selling American product,” Cotnam said. The weak Canadian dollar, coupled with tariffs and rising freight costs, means that a shop must triple its wholesale costs to make a sufficient profit. An item costing a store $100, for example, must be sold for $300. “We love our neighbors,” Cotnam said of that nation to Canada’s south, “but it certainly benefits us to sell Canadian product at this point.” Cotnam said CabanaCoast, based in Ontario, is his largest supplier. While the product’s frames are sourced in Asia, cushions are made in Canada “so we’ve got fixed pricing.” Anderson, at Patio Comfort, said another factor influences casual furniture sales besides the exchange rate, which is not that different from 2017. “There’s a Canadian flavor in people’s mouths because of the threat of tariffs and the political climate,” he said. “The dollar is something we’ve always had to deal with. Now, it’s the displeasure of the political climate and the bullying.” There was a time not so long ago when consumers entered a casual furniture store with a mission to “buy North American,” Anderson said. “But now people want to buy Canadian.”

Woven products are available at lower price points through mass merchants and Big Box stores. Designs similar to higher-end products confuse shoppers and challenge more up-scale shops to explain the quality/price differential to customers.

Sales seemed a bit more consistent at of origin for products that caught their Golden Acre Home & Garden in Calgary, eye. “If it’s from the U.S., I don’t want it,” Alberta. Birgit Dermann, casual furniture Squarie heard more than one shopper say. buyer, credited the improving health of “They also don’t want to pay tariffs.” the local economy with boosting sales over One common trend: The consumer’s 2017 levels. Even so, late summer’s fires to love affair with resin wicker is on the wane. the west had a noticeable effect on sales. “For us in Calgary,” said Dermann, “This last little bit of smoke has put a “wicker is done. We’re selling a lot more damper on things,” she said. “British metals. We’re selling more teak and ipé. Columbia is pretty much all on fire.” That’s something I’ve noticed for the last Farther to the east, in Regina, couple of years.” Saskatchewan, Paradise Leisurescapes In Edmonton, Belford noted that half enjoyed casual furniture sales or two-thirds of woven that edged ahead of 2017’s product purchased for the numbers. 2018 season remained unsold Conrad Ehmann, Sales in late August. In prior years, manager, described the season he said, resin wicker “has as good and busy. “I think always done quite well.” we’re a little bit better than Having to carry product over last year,” he said. “We’ve had into next year “doesn’t allow some decent weather.” us to invest in coming styles Prairie Provinces Paradise Leisurescapes also like we would like to.” Alberta, Saskatchewan, Manitoba has a store in Saskatoon. Both “Anything woven has been The sales pendulum was in full swing this cater to higher-end clientele Conrad Ehmann. in decline,” he said. “We’re season at Dinette & Patio Furniture in with products by Ratana, considering dropping maybe Edmonton, Alberta. OW Lee, and Ebel. Regina customers tend half of what we carry.” Up, then down. to be “a little conservative,” he Resin wicker used to account for 70% The beginning of the year said, while Saskatoon of outdoor furniture sales at Luxe “started like gangbusters,” homeowners lean more toward Furniture, Squarie said. Resin wicker now said Brett Belford, store fashion-forward designs. generates about 50% of sales. manager. “And the day Paradise Leisurescapes stocks Market saturation could be one reason the Trump tariffs were the two stores accordingly. that resin wicker apparently has peaked. announced, we saw a big Luxe Furniture Company Woven products are available at lower decline of about 20%. in Winnipeg, Manitoba, was price points through mass merchants “We had the best March up nearly 10% for the first and Big Box stores. Designs similar to and April we’ve had in seven months of the year. higher-end products confuse shoppers and years,” Belford said, “then Sales were strong in indoor as challenge more up-scale shops to explain the worst June, July, and Birgit Dermann. well as outdoor products. the quality/price differential to customers. August we’ve had in years.” Sales cooled appreciably with Converting the resin shopper to a resin Casual furniture retailers aren’t the August’s arrival, said owner Phil Squarie, buyer is more difficult than ever. only ones suffering, he said. “Even the big Jr. Politics may be a factor in the decline. Belford suggested another reason that department stores have seen a big decline Around that same time he began resin wicker may have lost some of its in the last couple of months.” hearing customers ask about the country appeal, and a surprising one at that:


www.hearthandhome.com | OCTOBER 2018 | 39

The Canadian Patio Business |

“When we buy containers, we buy in U.S. funds. When we buy from the warehouse, we buy in Canadian funds. When all is said and done, there are some savings but it’s not huge. If the dollar was on par, it would probably be a different story.” — Conrad Ehmann Paradise Leisurescapes

The Laguna Collection by Fred Doughty from Jensen Leisure Furniture.

maintenance. The Rocky Mountains run along Alberta’s western border with British Columbia. The peaks wring out much of the moisture from air currents blowing west to east. As a result, Edmonton is dry, receiving less than 20 inches of precipitation annually. The many nooks and crannies in a typical woven chair or sofa tend to trap natural debris such as leaves and twigs, Belford said, requiring “a lot more maintenance than we would like to admit.” What are people buying instead of resin wicker? Sling and deep seating, Belford says, much of it by Telescope Casual Furniture. “Some of their designs are really unique,” he said. At Golden Acre Home & Garden, Dermann said no particular category dominated sales. “We tend to cherry pick the best from all the different types,” she said. “In

40 | OCTOBER 2018 | www.hearthandhome.com

aluminum, Mallin was very strong. In teak, Gloster was strong. In ipé, Jensen Leisure. It just depends.” Generally speaking, she noted, “There definitely is an appreciation for things that are a little more organic.” Squarie noted the same at Luxe Furniture. Aluminum product with teak accents, available for several years, is enjoying a resurgence. So are other mixed media products. “Ratana has a set called Cape Town that did really well for us,” he said. Cape Town features a wicker seatback on an aluminum frame. Aluminum deep seating is making a comeback at Paradise Leisurescapes. “Straps and slings are starting to come back as well,” Ehmann said. There’s also renewed interest in casual dining furniture. Ratana remains an important manufacturer for Paradise Leisurescapes’

customers who prefer resin wicker. The Vancouver-based company has an advantage over U.S.-based companies in that it can ship product more quickly to Canadian retailers. The Canadian dollar has been battered by the U.S. dollar for some time now. As this issue goes to press, the Canadian dollar equals .76 U.S. dollar, a 1.24 differential. The differential has been even greater from time to time in recent months. This situation would appear to give Canadian casual furniture companies a big advantage over U.S. manufacturers when selling to Canadian retailers, but that’s not necessarily the case. Any advantage depends on how a shop makes its purchases. “When we buy containers,” Ehmann explained, “we buy in U.S. funds. When we buy from the warehouse, we buy in Canadian funds. “When all is said and done, there are some savings,” he said, “but it’s not huge. If the dollar was on par, it would probably be a different story.” Absolute parity isn’t necessarily desirable, Belford said. “We prefer (the dollar) not to be par,” he said. “We prefer it to be $1.15 or $1.20. When it gets to be par, it creates other issues.” The West – British Columbia The surprise of this casual furniture season in British Columbia is that it seems to have turned out generally OK. That’s somewhat amazing, considering how Mother Nature and humankind apparently conspired to put a damper on the patio furniture business. Weather, of course, typically is the biggest variable that comes to bear on casual furniture dealers, and 2018 provided plenty of uncertainty for some, but not all, BC retailers. Other mischief-makers joined with the weather to play havoc with furniture sales. Factors that inhibited more robust furniture sales included: • Forest fires that turned skies smoky black for weeks on end, particularly in inland areas and expanding eastward into Alberta. More than 2,000 wildfires struck British Columbia from April 1 through August 30, according to the BC Wildfire Service.

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The Canadian Patio Business | • Threats of a looming trade war with single order with Treasure Garden each year. the United States, with tariffs already “When that’s all out,” he said, “that’s it.” affecting some casual products. The favorite category at Comox • Rising freight costs. Fireplace & Patio is cast aluminum • Skyrocketing housing prices, particularly “because of the weather,” Wittwer said. in the Vancouver area, and new taxes “Anything other than cast aluminum on foreign ownership have led to doesn’t work well.” Resin wicker “never paralysis in the residential real estate really moves in our market.” market. Outdoor furniture is “an off-season “This year has been really funny,” said gig” for Wittwer and brings in about Clarinda Kung, owner of Ginger Jar, a $80,000 annually. “Our main business is fashion-forward furniture retailer in fireplaces,” he said. Vancouver. “I think we are still up some, Wittwer praised Telescope Casual but not as much as we had hoped.” Furniture’s policy of putting a cap on The year started well, Kung said, but freight costs. Courtenay, in Canada’s sales slowed after a change extreme far West, is about in leadership in the 3,000 miles from Telescope’s provincial government and factory in Granville, New the residential real estate York. Telescope limits a market stagnated. retailer’s freight costs to 11% Shoppers, she said, on orders of $1,200 and “have to think long and above. That provides a level hard” before parting with of certainty to the retailer their dollars. “Nobody and his customer, especially seems to know what is when Canadian freight costs happening from day to are climbing. day,” she said. Clarinda Kung. “Telescope has a fantastic Ginger Jar’s casual shipment deal,” Wittwer said. furniture lineup is mostly European styles The summer’s wildfires snuffed out and brands, which is what Vancouver’s buyer enthusiasm at Patio & Home Direct, fashion-conscious, international a retailer in Vancouver. Impulse traffic and population prefers. TUUCI and Lloyd sales fell, said manager David Flanders’ products are the only U.S. Ringuette. Shoppers whose outdoor lifestyle brands at Ginger Jar. purchases were planned in Kung said Lloyd Flanders is her advance continued to shop, “personal favorite. We stick with their he said, though the prospect signature pieces, because that’s what of having new deep seating they’re known for.” cushions soiled by smoke and Sales were down at Comox Fireplace ash cast a shadow on sales. & Patio, said owner Tomi Wittwer, Ringuette noted that sales proprietor since 2006. “May and June of ornamental cast iron were were very rainy, and June was very cold,” virtually dead, while interest Wittwer said. in resin wicker is beginning to Kent Melvin. His store is in Courtenay, about a four- wane. On the other hand, sales hour drive north of Vancouver. of less-ornate wrought-iron Wittwer said the bulk of his furniture by Kettler “have annual casual furniture sales been fantastic.” are made in May and June. Resin wicker “isn’t going Volume generally declines in away anytime soon,” he July and August. said, but “new buyers” show This year, the unusual a preference for “sleek, clean weather pattern kept sales of lines” and have less interest fire tables healthy through the in “the boxy wicker look.” summer, “maybe because it was Patio & Home Direct pretty cool.” Umbrella sales carries products by Ratana, were also up. Wittwer places a David Ringuette. and quick access to Ratana’s

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Vancouver warehouse gives that brand an edge over products that may take six to eight weeks or longer to deliver. The store brought in a number of Ratana’s new collections for the 2018 season, Ringuette said, and was surprised when those products “didn’t move at all. So we’re going to stick with their classic stuff.” Kent Melvin owns Beachcomber Home Leisure in Kelowna, about four hours northeast of Vancouver. He faced a cooler than normal June and an extremely smoky August. He expects to finish the year “about the same as last.” Interest in resin wicker is cooling, he said, replaced by growing demand for tubular aluminum. “Metal’s starting to come back,” he noted. Fire pits remain a good category but “have definitely cooled down.” Melvin noted that Big Box stores, such as Costco, now offer cantilever umbrellas, which previously had been exclusive to specialty merchants. The Big Box competition’s cantilever models can’t match the quality of umbrellas at a casual store, he said, but the lower prices will lead to shopper confusion. “That’s starting to bite into the cantilever business,” he said. The Trump administration’s trade spat with Canada has shoppers acting wary and cautious. They’re concerned about how the trade war will affect prices and if it will have long-term bearing on the Canadian economy. Costs for some products already are rising. Imported textiles are subject to a 10% tariff, Melvin said, which affects U.S.-made cushion covers and umbrella canopies. But the tariff is not being levied uniformly. “One brand, you’ll get hit with it,” Melvin said. “The other, you won’t. I don’t know if Customs knows what is going on.” Melvin noted that he’s seen freight costs double, from “10% to 20%. The market can only take so much.” Consumers are taking note. “People are saying, ‘We’ll wait and see’ and hold off on their decision,” he said.

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| The Canadian Patio Business |


LIFETIME CUSTOMERS After 25 years with Beachcomber, Warren Yadlowski surely knows hot tubs; he also knows retailing and marketing very well. By Tom Lassiter

Q. How many bar stools does it take to equal one hot tub?

Beachcomber hot tubs.

A: Too many.


he math is simple. One must sell a . . . . load of bar stools to equal the financial infusion a specialty retailer gets by selling one $11,000 CN hot tub. That explains Warren Yadlowski’s reasoning. The general manager at Beachcomber Hot Tubs & Patio in Edmonton, Alberta, has opted to concentrate on his store’s core product lines year ’round. He has resolved not to bring in auxiliary products in hopes of generating additional sales over the slower chilly months. He and his predecessors have attempted that strategy and found it lacking. In his 25 years at Beachcomber, the store has

44 | OCTOBER 2018 | www.hearthandhome.com

tried Christmas trees, massage chairs, mattresses, and case goods to see it through the lean months. And in each case, the math was similar. One must sell a boatload (gotcha!) of Yule greenery or bedside tables to equal a single hot tub. “We are not in the indoor business,” Yadlowski says. Most casual furniture retailers share his concerns about the off-season. Unless one is blessed with a particularly warm Sun Belt location, there comes a time each year when people just aren’t thinking about up-fitting the Outdoor Room with a new chat group or installing a new hot tub.

The fear is real. “All of a sudden, the tap could shut off and you don’t get any traffic,” he says. Yadlowski, who oversees the three Beachcomber stores serving Edmonton, came up with a uniquely Canadian promotion to jumpstart sales when the province is knee deep in white stuff. Snowblowers. Buy a hot tub when the earth is hard frozen, and Beachcomber will throw in a snowblower for free. “What do you think the consumer said? They thought it was fantastic. ‘Boy, OPPOSITE PAGE: Warren Yadlowski.


Click here for a mobile

friendly reading experience www.hearthandhome.com | OCTOBER 2018 | 45

The Canadian Patio Furnishings Business | you guys are geniuses! My wife’s wanted a snowblower for 20 years!’” (Is it possible there are homeowners in northern Alberta who don’t already own a snowblower? Maybe that wife wanted one of her own.) “If you sell an extra five or six hot tubs a month, that’s a lot of bar stools,” Yadlowski says. “We know what we’re doing in the hot tub business. Let’s just sell more hot tubs in the winter. How does that sound?” Beachcomber Hot Tubs & Patio knows what its doing, period. Yadlowski, who has run things since the store’s founders

This year, Yadlowski’s team made a new September buying trip. Destination: Spoga+Gafa, the massive garden trade fair in Cologne, Germany. Beachcomber already buys direct from a couple of casual furniture factories based in China. By attending Spoga, Yadlowski expected to see more of their offerings and perhaps make connections with new vendors. Economic necessity drove Yadlowski to Spoga. Buying direct “and I hate to say, cutting out the middleman, is the only way we

order, plus shipping, plus the added expense of a less-than-trailerload shipment takes away much of the appeal of special orders. Premium brands face additional hurdles. The currently unfavorable U.S./ Canadian currency exchange rate and rising shipping expenses push up the prices that must be charged for those brands. The general rule of thumb is that wholesale costs for U.S. products must be tripled at retail in Canada. The current trade war with the U.S. and the possibility of additional tariffs add more uncertainty as Beachcomber plans for 2019.

Everything for outdoor living displayed under a 40-ft. ceiling.

sold the business to an investment company in 2011, isn’t afraid to experiment and break away from the pack mentality. Under his leadership, the business has opened a third location and physically expanded another. In a move that some specialty retailers might consider to be consorting with the enemy, Beachcomber participates in an intensive hot tub promotion with Costco. Yadlowski and his team have skipped Casual Market Chicago in recent years. Like some other casual furniture retailers, they do what they need to do at Premarket, followed by a visit to the Las Vegas Market to see if there’s anything interesting in the temporary showrooms.

46 | OCTOBER 2018 | www.hearthandhome.com

can get prices down to where we can still (move product) and make profits,” he says. “It’s unfortunate, but that’s just the way it’s happening. And if we don’t, we’re going to be in big trouble.” Beachcomber positions itself as a middle- to high-end dealer in one of the larger metro areas in North America with a population of more than one million. U.S.-based manufacturers OW Lee, Ebel, and Homecrest are long-time vendors. Beachcomber buys deep and sells from stock, with sales from inventory accounting for 90% of sales. Manufacturers encourage developing the special-order business, but it’s a tough sell in northern Alberta. The lengthy time to fill an

Yadlowski must exploit every opportunity to constrain Beachcomber’s costs. That means buying direct, which gets him the best prices on product and shipping. It also means placing orders early. He makes his Homecrest buy in August. He also strives to make his direct purchases before September. “If you’re going to get anything shipped before Chinese New Year, those orders have to be in by August,” he says. Six to eight weeks on the water and by truck to Edmonton gets those containers to Beachcomber’s warehouse just in time. And timing is everything in the casual furniture business, especially in the higher latitudes.

“If we don’t have our product in place by March, it makes it real hard,” Yadlowski says. “If you miss one or two months of selling time, you’ll never make it up in the fall.” Evolution Yadlowski’s brother-in-law founded Beachcomber Hot Tubs & Patio 35 years ago. He joined the company 10 years later. What began as a swimming pool service business quickly became a hot tub dealer and then moved into patio furniture. Grills were added about 15 years ago. “Now we’ve become the outdoor living store in Edmonton,” Yadlowski says. Two Beachcomber locations have 18,000 sq. ft. or more of showroom with 40-ft. ceilings, perfect for raising cantilever umbrellas. More than half of the space is dedicated to casual furniture. The third and newest location has about 9,000 sq. ft. of showroom. The third store is only a 20-minute drive from one of the larger stores, but it’s in an area with one of the highest per capita income levels in Canada. The store first opened as a pop-up, in a temporary location, and Yadlowski logically stocked it with his top-end lines. Shoppers let him know his logic failed. “That’s all you got?” they asked. “What if I don’t want to spend $8,000 on my outdoor furniture?” Yadlowski revamped the product mix, bringing in more affordable furniture. Shoppers responded more favorably to choices, rather than being told to drive to another Beachcomber location. After two seasons in temporary space, Yadlowski felt confident enough to commit to a third permanent store. You won’t find many vignettes at Beachcomber. Each store has a number of compartments – hot tubs here, patio furniture there. All sectionals are displayed in one area, with dining sets in another. “We try to make it as easy as we can,” he explains. Customers “can make their decisions by moving from one to the other, quite easily.” Tabletops are accessorized with placemats, plates, and glassware. Walls display flags, outdoor thermometers, clocks, and mirrors. The grill area has “charcoal trays, smoker trays, you name

it. We sell tons of accessories and tools. “Our store is full of that stuff,” Yadlowski says. “We pride ourselves on having things you can’t find anywhere else.” Just as the company’s product mix and sourcing strategy has evolved, so has its name. The company became affiliated with Canada’s Beachcomber Hot Tubs soon after opening. Independent retailers who signed on with Beachcomber “for a dollar and a handshake” got to use the name,

“I like the fact that there’s no confusion about what we’re all about,” he says. Short Season, Long View Yadlowski’s stores do more than 80% of their business in an eight-month span. The casual furniture season is even more concentrated, with most sales being made between April and September, which is “clearance time. We sell very little patio furniture between October and February,” he says.

An umbrella adds a touch of color to a display of Napoleon grills.

signage, and point-of-sale material in return for brand exclusivity, Yadlowski explains. The deal remains the same today. “By and large,” he says, “it’s been a good relationship.” This unusual “friend-chise” business model explains why there are numerous Beachcomber stores sprinkled across Canada with many different owners. The Edmonton Beachcomber stores have seen several name variations over the years. Beachcomber Spas was used for a time, until the Americanized usage became pervasive and shoppers thought a spa was a place for a massage, manicure, and perhaps a pedicure. Beachcomber Home Leisure was on the signage for a while. Now it’s Beachcomber Hot Tubs & Patio, and Yadlowski is happy with it.

Fortunately for Beachcomber, the end of the outdoor furniture season is an excellent time to sell hot tubs. That’s because when the air is frigid, Albertans love to immerse themselves in hot water. Hot tubs, Yadlowski says, “are used more between September and April than they are in the summer. That’s the reality. We’re just moving into our super busy season for hot tubs right now.” When the air begins to get nippy, homeowners hankering for a new or replacement hot tub get panicky, he says. Those who thought about a new hot tub all summer must act in the fall, or they might not have any bubbling hot water in the backyard come winter. Beachcomber does everything it can to encourage buying now, not later.

www.hearthandhome.com | OCTOBER 2018 | 47

The Canadian Patio Business |

Fire pits share space with deep-seating chairs.

Financing can be arranged from the shopper’s smart phone. Purchase of a hot tub includes delivery, setup, and a “wet start.” In other words, it’s a turnkey purchase, ready to go. Occasionally, customers look at hot tubs in the fall, thinking of a backyard remodel come spring. Construction of the new patio might be scheduled for April, but Beachcomber sees no reason to forego a new hot tub until then. Beachcomber offers a “six-month move policy.” The company will install the tub in a temporary spot where the homeowner can enjoy it through the winter. Then, Yadlowski says, “We’ll come out and move it within your yard for free within six months.” New hires are told to think of Beachcomber as being in the car business, except “we call them hot tubs, and we’re a little smarter than the auto business. We also sell fuel, and we have a service station in all our stores.” As a result, Beachcomber’s customers return again and again. The adult children of loyal Beachcomber customers become second-generation customers. Hot tub customers need patio furniture, umbrellas, and grills. “It’s all about foot traffic and getting these people back in,” Yadlowski says. Beachcomber Hot Tubs & Patio enjoyed its best year ever in 2015. Its second-best

48 | OCTOBER 2018 | www.hearthandhome.com

year was 2016. Sales declined a bit in 2017, Yadlowski says. “We have struggled a bit,” he says. “I will be upfront with you.” Store traffic has declined since 2015, perhaps another symptom of the still ailing local economy. The economy of Alberta, with great petroleum reserves, is closely tied to Canada’s energy markets. The hot tub business has remained strong, though some of the company’s other product categories have taken the hit. Maintaining sales volume is all about finding the sweet spot with the right balance of price point, product, and perceived value. This season, Yadlowski found it in another high-ticket category: modular outdoor kitchens. Beachcomber learned in previous seasons that customers would buy an outdoor kitchen package with a cabinet, grill, refrigerator, and storage if the price could be capped at about $10,000. But with the unkind exchange rate and rising freight costs, the retailer found few options. That changed for this season with products from Bull. Customers liked being able to customize the synthetic stone face of the two-tiered bar of Bull’s Ultimate Q model. Beachcomber stocked the product and participated in a quickship program. Tickets came in around $8,500 or less, the perfect sweet spot for the Edmonton market.

“We couldn’t keep them in stock,” Yadlowski says. “The price point was phenomenal.” Once Beachcomber lands a customer with the sale of an aspirational product such as an outdoor kitchen, other sales often follow. Sometimes those sales follow sooner, rather than later. A shopper came in intending to purchase a hot tub on an August Saturday. He did. But before leaving, that customer also purchased an outdoor kitchen and patio furniture. “Basically,” Yadlowski says, “everything we have.” The only product type not listed on that ticket was a big umbrella, but that purchase may come next spring. Beachcomber made its first direct purchases from Chinese factories about two years ago as a way to counteract pressures that have continued to worsen in 2018: an unfavorable exchange rate and rising shipping costs. A lot of U.S.-sourced product, Yadlowski says, “has priced itself out of my Western Canadian market. We were a fairly successful Tropitone dealer for many years. We’re not anymore.” He had to drop the line. The decision to buy containers direct from factories has paid off. “The difference in the cost and pricing for us was astronomical,” Yadlowski says.


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The Canadian Patio Business | The price points afforded by container purchases, he says, allow Beachcomber to retain customers it would otherwise lose to competitors such as membership warehouse stores, home improvement chains, and mass merchants. Yadlowski says he repeatedly saw young families shop for furniture in his stores but fail to buy. Upon follow-up, he learned that they often purchased a patio set in the $2,000 range from a competing Big Box store. Before purchasing direct, Yadlowski had nothing for them. He acknowledges there is a market in Edmonton for high-end, top-quality casual furniture offering superior comfort and a long warranty. But he felt Beachcomber couldn’t ignore shoppers with less buying power. “For us to compete and continue to grow, we have to bring in product at that $1,500 to $2,000 price point,” he says. “Going direct to China has allowed us to bring in quality, outdoor, all-weather wicker furniture in deep-seating sets or sectionals, a lot with Sunbrella or equivalent material. It’s selling very well.” The strategy, he says, is the only way to keep prices down, make profits, and move all the product by season’s end. “It’s unfortunate,” he says, “but that’s just the way it’s happening.” Had Beachcomber not taken this path, the result would have been “big trouble.” Yadlowski is pleased with the product mix on his floors now. At the lower end, Beachcomber has better quality entry-level product, two or three steps above that of competitors, he says. “By going direct, we are finally able to compete at a similar price point. We’re finally there,” he says. It’s like going back 25 years, he says, to be able to offer a fourpiece set with a love seat, two club chairs and a coffee table for $1,499. “But now, in 2018, I can price it at that and still make the margin I need to be successful.”

Costco invited Beachcomber to be its hot tub purveyor after a prior arrangement led to too many returns, Yadlowski says. The downside of the deal is that Costco “takes a good percentage of the sale.” The upside, he says, is that Beachcomber still makes money and potentially earns a new customer for life. “The beauty of the Costco customer is that they’re our customer,” Yadlowski says. Those who buy a hot tub in an Edmonton Costco are treated “just like a normal customer who buys in our stores. They’re treated exactly the same way. Same delivery, service, everything.” When friends ask that homeowner where he got his hot tub, the answer isn’t

Costco, Yadlowski says. It’s Beachcomber. The “customer for life” philosophy has credibility. Yadlowski sees it in the secondgeneration shoppers who come in to furnish their first Outdoor Room. He sees it in loyal customers who come back year after year. For example: There’s a fellow who comes in for a new Beachcomber hot tub every time he moves. He got into a new house in August and bought his fourth hot tub. He purchased a model from inventory and got his wish to have it installed the next week. Yadlowski smiles when he recalls the salesman’s summary. “Easiest sale I ever made.” That’s just another benefit of nurturing customers for life.

Store Name: Beachcomber Hot Tubs & Patio

Gross Annual Sales: $10.5 M

Locations: 15139-118 Avenue, Edmonton, Alberta 5213-99 Street, Edmonton, Alberta 270 Baseline Road #128, Sherwood Park, Alberta

Square Footage: Showroom: 12,000 Warehouse: 3,000 Outside Area: 1,000

Unusual Partnership Edmonton boasts seven Costco membership warehouses. Each runs a multi-day hot tub promotion one or more times during the year. Each one is staffed by sales personnel from Beachcomber Hot Tubs & Patio. The arrangement is in its ninth year.

E-mail: warren@beachcomber.ab.ca

50 | OCTOBER 2018 | www.hearthandhome.com

Number of Stores: Three General Manager: Warren Yadlowski Owners: Value Invest Year Established: 1983 Website: www.beachcomber.ab.ca Phones: (780) 448-9815 Number of Employees: Full-time: 18 Part-time: 5

Product Lines Carried: Hot Tubs: Beachcomber Hot Tubs Barbecue: Napoleon, Weber, Bull, Louisiana Grills Patio: OW Lee, Homecrest, Erwin & Sons, Plank & Hide, Ebel, Kettler, Hanamint, Woodard, Treasure Garden Advertising % of Gross Revenue: 2.5% Advertising: Direct Mail: 10% Other: 90%

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The Canadian Barbecue Business |

CANADIAN I-QUE Pizza ovens, built-in grills, and Outdoor Rooms are hot; Prop. 65, and tariffs are lurking.

Lisa Readie Mayer


he key barbecue-selling season was slow to start in much of Canada this year – snow as late as May will have that effect. But by most accounts, once it hit its stride, it turned out to be a good one. Many manufacturers and retailers we spoke with for our annual deep-dive into the Canadian barbecue marketplace report business was up overall, with some notable trends emerging within the category.

48-inch built-in grill by Crown Verity in Mount Royal, QuĂŠbec.

52 | OCTOBER 2018 | www.hearthandhome.com

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friendly reading experience www.hearthandhome.com | OCTOBER 2018 | 53

The Canadian Barbecue Business |

MANUFACTURERS “Most of the country experienced cold, snowy weather into late April and early May,” according to Jeff Kozak, vice president of Grill Sales for Napoleon, “but we saw growth thanks to a strong recovery in July and August. We’ve seen stronger results in Central Canada compared to the West, and we continue to see demand extend later in the season as compared to a few years ago.” Kozak attributes some of this success to the company’s “Upgrade to a Napoleon” advertising campaign resonating with consumers and dealers. He says Canada is still predominately a gas-grill market, particularly for weeknight use, but adds, “We continue to see demand for alternative methods of cooking. Low-and-slow charcoal and pellet cooking continue to gain popularity as secondary (methods used on the weekends). One of the many great benefits of our gas grills is that they can be used as a charcoal grill, as well.” Kozak says the Outdoor Room concept is gaining popularity in Canada, and the company is seeing strong year-over-year growth within the category. “We continue to see strong investment in the new-home construction segment, where outdoor kitchens are becoming more common, as well as in-home remodeling.” The company plans to launch 20 new models of built-in doors, drawers, beverage centers, and other components for custom outdoor kitchens, adding to its existing

Spirit II by Weber-Stephen.

54 | OCTOBER 2018 | www.hearthandhome.com

line of built-in grills and Oasis modular island kits. “We continue to gain momentum in the outdoor kitchen category, offering consumers an aspirational outdoor kitchen that is luxurious and affordable at the same time,” he says. According to Kozak, Tony Ferraro. dealers who display a broad array of barbecue products and accessories, offer assembly and same- or next-day delivery, invest in staff training and education, advertise grill and outdoor products year-round through traditional and digital avenues, and offer cooking classes, are the ones gaining share and driving business within the category. The company is monitoring the fluid tariff

Academy – with exposing Canadians to different grilling, barbecuing, and smoking appliances and techniques. “More and more Canadian consumers are investing in a second grill with the intent to become more adventurous grillers,” he says. Ferraro says that, “an overwhelming number of Canadians prefer outdoor meals over indoor,” and are inspired to create “a full outdoor kitchen experience” in their backyards. “The backyard continues to be an investment trend that is not losing steam in Canada.” He says built-in appliances, storage, and entertainment amenities are growing in popularity.

“The larger of the disruptions occurs with China-made grills and accessories bound for the U.S. market.” — Tony Ferraro Weber-Stephen Canada Company

situation and other trade issues for potential impacts on business, but is approaching 2019 with optimism, anticipating continued growth and solid consumer spending. Despite winter dragging on longer than it was welcome, Tony Ferraro, general manager, Weber-Stephen Canada Company, says an unusually dry and warm spring season resulted in record sales at the register. “Canadian winters are long, so consumers are eager to enjoy their short summer months by firing up their grills as soon as warmer weather arrives,” he says. Ferraro notes that grill purchases remain “heavily weighted on gas grills (due to) ease-of-use and convenience.” However, he sees that “premium charcoal and alternative-fuel grills, such as pellet grills, are making a strong push in selective regions across North America.” He credits the classes offered by The Weber Grill Academy – at its brick-andmortar location in Vaughn, Ontario, and at various locations throughout the country, courtesy of the Mobile Grill

Millennials are an emerging and critical segment in the category, according to Ferraro. “We know, through extensive research, they will change their buying patterns and are likely to increase their grilling frequency in the next few years,” he says. “According to Statistics Canada, Millennials tend to live in apartments or condominiums. Due to many condominium restrictions, the demand for a specific grill size or fuel source will certainly be impacted. Millennials’ consumer behavior will have a deep impact on manufacturers’ and retailers’ innovation and go-to-market strategies, to ensure they continue to be relevant with every demographic.” As for the future, Ferraro says the company’s outlook for 2019 remains positive. Weber plans a slate of new-product introductions in the coming year, but Ferraro says he can’t spill the beans just yet. One potential fly in the ointment is the evolving trade agreement between the U.S. and Canada. He says the retaliatory tariff situation is “very complicated,” but adds that, to date, the impact on the Canadian market has been minimal.

“To simplify, there are three trade agreements in question,” he explains, “one between the U.S. and Canada (the North American Free Trade Agreement), one between the U.S. and China, and one between Canada and China. NAFTA is the most concerning and the one we are focused on. The U.S. president put a tariff on raw Canadian steel and the Canadian government retaliated by taxing U.S. steel. This impacts mostly on replacement parts, and it has been pretty insignificant, so we haven’t passed the increase along.

Versa 100 portable grill from Jackson Grills.

“The larger of the disruptions occurs with China-made grills and accessories bound for the U.S. market. Those imports will likely be levied up to 25%, which will substantially impact the value and retail pricing in the U.S. At this time, the Canadian trade agreements with China and the U.S. remain relatively untouched with little impact to Canadian consumers.” Jason VanGarderen offers insight on the Canadian barbecue marketplace from the perspectives of both a manufacturer and a distributor. As managing partner of Jackson Grills, VanGarderen says the company enjoyed a 14% year-over-year increase in sales of its stainless-steel grills and outdoor kitchen components in 2018. Though he says Canada has traditionally been the largest market for the grill line, it has been gaining traction in the U.S. The company’s best-seller is a threeburner, cart-based model priced around $1,500, according to VanGarderen. “It includes a rotisserie, quality materials and a long warranty,” he says. “It’s a good value and is a not-too-big, not-too-small goldilocks size, which seems to be why it sells great.” The company also has had

success with its premium, and Del Sol brands of grills stainless-steel, portable Versa and outdoor kitchen grill line, introduced two products, Island Grillstone years ago. “People are buying accessories, and multiple it to replace a cheap grill on hearth lines throughout their high-end RV or boat,” Western Canada. “It’s a more he says. mature market and we are Jackson Grills has not growing existing business, yet felt the effects of the so we were very satisfied,” tariff-related increases on he says. material costs, according to Jason VanGarderen. He says the mood among VanGarderen, “but to say we retail customers in his are holding our breath would be a fair distribution territory was positive this statement. We are fortunate to have year, with more dealers interested in inventory of finished product and are not “piggy-backing on manufacturers’ buying raw stainless at the moment. But, promotions” to boost traffic and sales. “In as a manufacturer, that will change over time the greater Vancouver area we have a more and could impact the cost of accessories, temperate climate than the rest of Canada, doors, and drawers for outdoor kitchens. so we enjoy a longer barbecue season.” He Who ultimately pays the price when says the majority of Canadian consumers countries impose tariffs and counter-tariffs? opt for gas grills, but notes pellet grills “are Consumers. It’s very unfortunate.” getting a lot of attention. They, more than He says Proposition 65 has presented charcoal, are seen as a new alternative to gas.” another business challenge this year. The VanGarderen says interest also is California legislation requires companies growing in outdoor kitchens, and as they

“The mood among retail customers in my distribution territory was positive this year, with more dealers interested in ‘piggy-backing on manufacturers’ promotions’ to boost traffic and sales.” — Jason VanGarderen Concorde Distributing

to include a warning label on products sold in the state that contain or cause exposure to any of the 800 known chemical compounds that may cause cancer, birth defects, or reproductive harm. “It’s a major nuisance for a small manufacturer,” VanGarderen says. “It’s impossible for us to have separate packaging just for shipping to California, so the label goes on all packaging, which means consumers in other areas are reading it and don’t know what it’s about. It’s confusing for people.” In 2018, outdoor-related business was up 5%, and hearth business much more, at VanGarderen’s hearth and barbecue distribution company Concorde Distributing. The company distributes Jackson Grills, Twin Eagles, Delta Heat,

become more popular, people are using the equity in their homes to renovate their backyards. However, he says lack of uniform codes and standards regarding ventilation requirements has been an impediment to outdoor kitchen sales in the region. “Maybe not in California or Arizona, but when someone builds a high-end outdoor kitchen in Canada, they want a roof over it to shelter it from the elements,” VanGarderen explains. “The building-code standard states that overhead combustibles must be protected, but it is not specific about what ‘protection’ means, what’s required, or how to do it. Building inspectors don’t want to make the decision, so it’s dampening high-end outdoor kitchen sales and really hurts large projects.

www.hearthandhome.com | OCTOBER 2018 | 55

The Canadian Barbecue Business | We could be selling more outdoor kitchens Thiessen says pellet grills are increasingly if the standards on roof coverings were not being built into outdoor kitchens at homes in so general. Canada and the U.S., and the company has “HPBA is needed to influence the seen great interest in its continuous-feed, development of industry standards for vertical pellet smoker, introduced last year. outdoor kitchens, but the issue hasn’t The company has a growing presence moved anywhere,” he adds. “I would like in Big Box, warehouse, and other chain to see the HPBA technical stores, but Thiessen says committee make this a Dansons remains committed priority so we can get it to the specialty channel and worked out.” is investing in developing Pellet grill manufacturer a line of its Louisiana pellet Dansons recently moved grills exclusively for its Canadian-based operation independent retailers in the to the U.S. and is now U.S. and Canada, expected headquartered out of to launch at HPBExpo in Arizona. “It made sense 2019. because 90% of our sales Jeff Thiessen. volume is in the U.S.,” explains company president, Jeff Thiessen. RETAILERS He says business more than tripled this year, thanks in part to the growing The Maritimes popularity of pellet grills in the U.S. and New Brunswick, Newfoundland, Canada, and the company is looking to Nova Scotia, Prince Edward Island continue that trend by expanding into Trina Langille, manager of Barbecue Germany and other countries. Heaven, the in-house grill division of “The category has been around for 30 Warmth by Design in Upper Onslow, years, but finally pellet grills are really Nova Scotia, says barbecue sales have been resonating with consumers because they up across the board this year. Propane grill combine the ease of gas and the flavor of sales – they carry Broil King, Broil-Mate, wood,” he says. “Originally, pellet grills Napoleon, and Jackson Grills – have were purchased as a secondary grill, but increased thanks to larger displays and now that temperatures range from highbroader selections in the store. She says enough-to-sear-a-steak to low-enough-to sales of Green Mountain pellet grills have make-jerky, a lot of consumers are choosing “picked up a bit” this year, but “are still a a pellet grill as their primary grill.” new concept” in the region, and therefore represent a small percentage of the store’s total grill sales. Charcoal-fueled Big Green Egg cookers, however, are really gaining traction, she says. The store held its fifth annual “Thrill of the Grill” Eggfest in June, an event that has attracted more interest, cooks, and attendees each Trina Langille. year. “This year, the participating cooks prepared a great variety of food that really showed off the versatility of the Egg,” Langille says. The retailer added outdoor kitchens to its product mix for the first time this year, and did well with the Napoleon Oasis modular system it displays. Barbecue Louisiana Grills 800 Deluxe with pellet grill from Dansons. Heaven installed an in-store demonstration

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kitchen in its showroom two years ago and uses it for boot-camp classes where customers can cook on any type of grill to test it out. A “Thanksgrilling” event is scheduled this fall. “Demos and events give customers a chance to try something new,” she says. “It’s a fun activity for people to do on weekends and gets them in the store.” Langille cites online competition as “a little bit of a challenge.” She says, “Costco’s website, for instance, sells some of the same brand names we carry. It may not be the exact model we have, but customers see a comparable unit from the same brand at a lower price and sometimes go for it.” At Alternatives, a fireplace, stove, and barbecue retail store in St. John, New Brunswick, owner Jason Crowdis says grill sales had “a real slow start” courtesy of a cold, damp spring that delayed purchases, or in some cases, put them off until next year. “When it gets to July, some customers say, ‘We’ll wait ’till next year to buy.’” As a result, according to Crowdis, grill sales are “flat to a little off” this year. He says gas grills remain his biggest seller, but adds that kamados have been growing, “not dramatically, but very steadily.” The retailer sold “a couple pellet grills” this year, but says the category “is a pretty hard go here in the Maritimes. I think it comes down to lack of awareness and education.” He has not seen much demand for outdoor kitchens among his customers, either. “Unfortunately, our economy is down and there is a lot of unemployment in our area,” he says. “Customers don’t have the money to spend on outdoor kitchens, so we don’t emphasize them in our displays. When we do sell an outdoor kitchen, it is usually a Napoleon Oasis unit.” Another trend Crowdis is seeing: an increasing desire among customers for Canadian-made products. “We have a lot of people asking for “Made in Canada,” and we promote those products with big tags in our store,” he says. “Canadians were never overly patriotic like in the U.S., but we are following suit and are seeing a bit of a revolt. People in our area don’t want to buy U.S. products; they won’t vacation

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Jackie Schneider Brand Director, Heat & Glo

The Canadian Barbecue Business | there, or spend money there. It’s even happening with ketchup.” He explains that after Heinz closed its Canadian factory putting people out of work, French’s stepped in and took it over to produce French’s Ketchup, hiring local workers and using Canadian-grown tomatoes. “Now people, and even restaurants, won’t use Heinz and have switched over to French’s Ketchup,” he says. “People are fed up with the whole trade issue. Our suppliers say they will absorb the increases until NAFTA gets sorted out, but we’re already seeing increases on venting.” Paul Jackson, Service manager at Sunpoke in Hanwell, New Brunswick, says, “Winter lingered a long time, but when the weather finally switched, we had a very successful year.” He says business has been helped by a growing desire for

catching on next. “People like the ease of use and flavor,” he says. Outdoor kitchens, too, are trending upward. “When people are renovating their backyards or their homes, they will often extend the kitchen outdoors,” Frempong says. “Built-in grills and components are becoming very popular. Crown Verity, Delta Heat, and Sedona built-ins have Ontario and Québec been big sellers; customers The year has been “fair” for see the quality is high and Sobie’s Barbecues in Febian Frempong. consider them a better Toronto. The season did not value than some of the start off on good footing, according to super-premium brands. Sales of Napoleon owner Febian Frempong, due to rainy Oasis modular outdoor kitchens are weather in April. But even when conditions growing, too.” improved, he says it was too late to make Frempong has concerns about price up what was lost in the early season. increases on the horizon. “Parts are already up 10%, and we have been notified by some of our suppliers that prices will be “You cannot grow when the territory going up between 3% and 5% next year,” has this many stores selling the same he says. “We will have to increase prices to hold our margins. This makes it more products and brands.” expensive for customers and more — Febian Frempong challenging for us.” To counter the situation, Frempong Sobie’s Barbecues says they are developing more services to offer customers. “We have to diversify and value among customers. “Many people The retailer says increasing competition differentiate our store,” he says. “The Big come to us because they are tired of buying has been another impediment to growth. Box stores don’t do service and they mostly Box-store grills that don’t last,” he says. “There are too many dealers in our just sell barbecues in summer; we can do “They are willing to pay a little more for territory, too close to one another,” he says. both year ’round.” a barbecue that lasts.” “And competition from Home Depot and The retailer has recently launched a The store “expanded and upgraded” its Lowe’s makes it even harder on grill-cleaning and restoration service where grill selection this year, and now carries independents. It’s very frustrating; you they bring the customer’s grill to the shop, Weber, Broil King, Napoleon, Saber, Big cannot grow when the territory has this and thoroughly clean, restore, and repair it Green Egg, and Kamado Joe. Napoleon, many stores selling the same products and to brand-new appearance and performance. Saber and Kamado Joe were the standouts brands.” Any needed replacement parts covered this year, according to Jackson. “Kamados That said, there have been bright spots. under warranty are free, but the price for are still new here,” he says. “People may “We’ve noticed charcoal growing at a rate the “very labor-intensive service” runs walk through the door with a gas grill on we haven’t seen previously,” says Frempong. around $600. “Most customers balk at their mind, but when they see a kamado, “Our market has traditionally favored gas paying for the service,” Frempong says. they’re intrigued by the long warranty and grills, but charcoal grilling and smoking “They might not see the value if they only the chance to cook different things. are now trending.” spent $1,500 on their grill initially. But if Kamados generate more excitement.” He He says Weber Kettles and Smokey it cost $3,000, spending $600 after five says pellet grills haven’t caught on yet. Mountain Cookers are popular with years to fully restore it makes sense.” The store has a Napoleon Oasis outdoor customers new to charcoal cooking, but George Giesen, owner of Porky’s BBQ, kitchen display in front of the building, avid grillers who want to experiment “will Hearth & Spa in London, Ontario, and it has generated interest and sales, but eagerly spend $1,500 on a kamado,” he describes the year as “streakier” than most. Jackson says the category is limited in their says. The category also drives return visits “In the past, sales were more predictable market. “In Fredericton, winters are long to the store to buy fuel. Frempong says – we knew we’d have a good month in June – the weather didn’t turn nice until the pellet grills – he stocks Traeger and Broil – but now some months are inexplicably middle of June – so people are not inclined King brands – are showing signs of low and some are high. Some of it is

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to spend that kind of money. We sell mostly freestanding carts.” Though there have been no tariffrelated price increases on barbecue products, Jackson says the store has been notified of increases on the hearth-side of the business. “I have no doubt some grills will go up,” he says. “We hope this issue goes away soon.”

due to weather, but there is not always a built-in grills and outdoor fireplaces for in direct proportion to any tariff-related logical reason.” three-season rooms and outdoor kitchens.” price increases that might come along next He says, overall, the store is likely to The store sells the outdoor kitchens year. Though he has seen no barbecue price be even or up slightly in terms of dollar components and lets landscape architects hikes yet, he “expects the game will change sales, but down a bit in unit sales. “We and other contractors take the lead on next year and anything made of metal will typically sell 1,000 barbecues a year in a design-build. “We don’t have enough be going up.” town with a population of 350,000. By Outdoor Room business to be able to have Another source of concern is the far we are the leading a designer on staff; it’s too increasing difficulty in finding skilled independent in our area. costly,” he says. “But this has bricklayers, gas fitters, and plumbers. “It’s So, while we might be become a nice business harder to find and keep good people,” he disappointed when we say segment. You can’t get outdoor says, “and it’s driving up the cost of we only sold 980 barbecues, kitchen stuff at a Box store; installations. Our business is not just overall it was still a pretty you have to go to an expert.” selling something that the customer takes good year.” Giesen has noticed an home; we have to assemble, deliver, install, Giesen reports his aging trend among his troubleshoot – it’s very hard. But I guess best-selling gas barbecues customer demographic. “I 50 years ago we were worried about were three-burner units in think the younger people are different stuff. The world adapts and so the $900 to $1,500 range. George Giesen. shopping online – particularly will we.” “Our average customer for parts,” he says. “They’ll Max Lavoie, co-owner and president of doesn’t want anything fancy,” he says. argue that the price of the barbecue burner BBQ Québec, says he has been fortunate “People are looking for good value, was $3 less online. I get blamed for being not to face staffing issues. “We have been long-lasting grills with very few bells and whistles. We still sell the upper-end stuff where people are dropping $6,000, but I’m “Gas grill sales remain steady, with noticing interest in good value is trending.” customers searching for efficiency, Another significant trend: grill brushes. durability, long warranties, and value “We have sold four times more brushes this year than any other,” he says. “People at a $1,500 average price point. have been following the news and online ‘But the real growth,’ he says, reports about wire brushes. In previous years we would see a bump for two weeks ‘is in pellet and charcoal grills.’” after a news story, but this year it hasn’t let — Max Lavoie, up. It’s actually a little frustrating because BBQ Québec we’re getting lots of bodies in the store, but the increase in brush sales has not translated to an increase in barbecue sales. “In fact, our staff is spending much grumpy, but the last 11 people who came lucky that we have been able to attract a more time educating customers this year in, got our advice and then went and young, dynamic team of people who are – advice requests are way up across the bought online.” enthusiastic about what we’re doing and board,” Giesen explains. “Someone might The retailer is also observing a growing want to come work for us. I’m knocking have bought a smoker online and they’ll interest in “Made in Canada” wood, but they see our come in to ask our advice on how to products. “The Canadian company as fun, vibrant, smoke. It takes up a lot of our salespeople’s consumer never really cared exciting, high energy, and time, so the question becomes, how can much if a product was made growing.” we turn this opportunity into a sale?” in Canada or the U.S. – there Lavoie, along with his After nearly 15 years of trying, Giesen was more of a ‘Made in partners – brother JP Lavoie, says the Outdoor Room segment is finally North America’ mentality. and wife Ariane Lefebvre – beginning to take flight in his store. But this year, our customers just opened the fourth BBQ “Previously, customers would talk about are saying they don’t want Québec store (three are in wanting an Outdoor Room, but after products made in the U.S. Montréal and one is in learning what’s involved, most would They are making a statement Max Lavoie. Québec; a fifth location is a decline to go ahead with the project,” he against Trump, particularly store-within-a-store concept explains. “I don’t know if it’s the Pinterest if a family member’s job has been cut, or at his parents’ hardware store). effect, or because their neighbor has one, aluminum siding just went up for their Typically the retailers choose somewhat but it’s definitely becoming more of a house remodel. They’re getting mad.” remote store locations to take advantage trend. Now we’re selling lots of high-end Giesen expects the sentiment to swell of reduced rent, but the latest store

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The Canadian Barbecue Business | occupies an 850 sq. ft. space in a bustling farmer’s market, with room for classes, an adjacent boardwalk for outdoor demos, and greater foot traffic. This year, BBQ Québec launched its own line of branded sauces, rubs, and grilling accessories, available at hundreds of Sobeys and IGA grocery stores, among other retail outlets. Another new division, House of BBQ Experts, is an online marketplace and distribution company, offering a collection of innovative barbecue grills and accessories from brands such as Steven Raichlen Best of Barbecue, Arteflame, Sunterra, Ribalizer, and more. The company is entering the manufacturing fray with its patented All-in-One BBQ Kettle Accessory, a multi-purpose, combination rotisserie, pizza oven, cold and hot smoker, Argentinian grill, and bread baker designed to fit a standard kettle grill. In the stores, Lavoie says gas grill sales remain steady, with customers searching for efficiency, durability, long warranties, and value at a $1,500 average price point. “But the real growth,” he says, “is in pellet and charcoal grills. “We cannot focus all our future on gas because it is not a renewable fuel,” he says. “We are selling so many Weber kettles, that I’m proud to say we are the fourth biggest seller in Canada. For most of our customers it is their second or third grill, and they are having a lot of fun with it.” The company has branded its own carbon-neutral, Forestry Stewardship Council-certified charcoal, and regularly hosts charcoal grilling and smoking classes for 100 people at a clip. The team also is working on developing a prototype for a high-temperature electric barbecue, in conjunction with a student project. “It’s about changing the gas mindset,” says Lavoie. “Technically, a gas barbecue does not give any flavor; so it’s the same concept with an electric barbecue.” He adds that while they have been more focused on the cooking aspects of the barbecue category to date, Lavoie says they will extend the spotlight to include the Outdoor Room, as well. “Interest in the concept is definitely growing in our market,” he says. BBQ Québec started carrying modular outdoor kitchens from fellow Canadian company Urban Bonfire in one

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store this year, but plans to offer the line in all locations next year. “Those guys are doing a fantastic job,” Lavoie says. “The islands look beautiful, just like an indoor kitchen.” Prairie Provinces

Alberta, Saskatchewan, Manitoba

Owner John Christenson says snow that fell until mid-May is the reason barbecue sales are “slightly down” at Saskatoon Barbecues & More, this year. He says gas grills are the biggest sellers every year, but charcoal grills are more cyclical; last year they were soft, this year up again. Pellet grills also are in demand lately. He says the store does not move large volumes, but the category is trending. “We carry Yoder pellet grills, which have a big following,” he says. “They are a little pricey, so it’s a bigger buying decision, but

no question, cart grills are the biggest movers,” he says. Christenson hopes to grow the category next year thanks to a new outdoor kitchen display recently added to the showroom. He says offering services such as assembly, delivery, testing, and a free year of backyard troubleshooting helps to distinguish his store from a growing field of Big Box competitors. Another edge: demos on Saturdays. “We’ll do briskets on a Yoder, wings on a smoker, apple crisp on an Egg,” he says. “We try to show that you can do more than standard stuff.” As of yet, the store has not ventured into online selling and, according to Christenson, is “still trying to sort it out. My guess is we’ll have to try it down the road.” He says the biggest challenge is having the right product at the right time. “We

Urban Bonfire’s Urban 90 outdoor kitchen.

they do a good job and don’t have problems. While kamados are not fast sellers, Christenson says they actually sell better in the winter months because, ‘People like that they hold the heat and can be cooked on throughout the Canadian winters.’” The business does “a few” outdoor kitchen projects a year, typically providing built-in grills, accessories, and gasplumbing services, and leaving the construction to contractors. Modular cabinetry systems, such as the Napoleon Oasis, have caught on in the store, “But,

put our orders in for next year in late summer/early fall, and at that time you never know what customers will want.” Another difficulty: when manufacturers change product lines frequently. “If you’re going to keep a decent amount of stock in the building, you’re going to have stock leftover. Moving that older stock becomes an issue when grills are redesigned or features change; everyone wants the latest model. You might put a specific unit on sale, and sometimes it walks out the door quickly. But with MAP


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The Canadian Barbecue Business | trajectory. So much so that this year’s 3% A standout addition to the product mix this year has been a pizza oven accessory to 5% retreat took him by surprise. “I guess from Green Mountain Grills that inserts the busy summer was not enough to make into the hot box and gets up up for a late spring,” he says. to 800 degrees. “It’s great for “We are in our third season making pizzas or roasting and coming off the other foods, and makes the honeymoon stage, so we have pellet grill very versatile,” he to figure new and creative says. “We’re having fun ways to increase our profit talking about it in the store margin in an industry where and we’re selling quite a they set the prices.” few. It has also led to other Sales were inconsistent add-on sales of pizza peels, this year, with some and other pizza-making Phil Squarie, Jr. categories up and others accessories. It’s been a nice down. First the good news: surprise.” Pellet grill sales are “through the roof,” he The store’s outdoor kitchen business is says, with the Traeger line up 20% and growing. It mainly sells built-in grills, door Yoder up 50% over last year. “Our staff of and drawer sets, ice chests, and other eight has either a Traeger or a Yoder at components directly to customers or their home,” he points out. “They love the subcontractors. According to Breckman, simplicity and can really talk about it with they have also offered Bull pre-fab, finished customers.” outdoor kitchen islands for years, but Squarie says pellet fuel – the store selling components is “a much bigger part dedicates an entire room to solid fuels – does “really well,” too, and brings customers back to the store. He sees pellet grills –Traeger “We are in our third season and coming off in particular – trending with Millennials, the honeymoon stage, so we have to figure and says they often come in asking about the line. Another pattern he is seeing: new and creative ways to increase our “Instead of buying a $2,500 Weber or profit margin in an industry where they set Napoleon grill, more customers are opting for a $999 Broil King and adding a Traeger the prices.” — Phil Squarie, Jr. as a second grill.” Pizza ovens are another bright spot this Luxe Barbeque Company year, with sales doubling over 2017, according to Squarie. High-end Fontana couple years ago and is “very happy with of our business and accounts for the ovens – a line the store picked up this year it.” Their best seller is a medium price-point, majority of our outdoor kitchen sales.” – and entry-level, tabletop Uuni ovens three-burner model with rotisserie, priced The store has upped its social media were responsible for much of the growth under $2,000. “It’s a great game this year, increasing the in the category, he says. value,” he says. Bull gas grills frequency of its posts to The outdoor kitchen category is up in the $3,000 to $4,000 range Facebook and Instagram. In across the board. “People in Winnipeg are also are good sellers. addition to educational starting to get the concept of the total According to Breckman, content, Breckman says they backyard,” Squarie says. “We have two pellet smokers are catching on also use social media to outdoor kitchen displays in our barbecue in the store, thanks to growing promote store events, store and one in our furniture store, and consumer awareness. “Pellets including the cookouts it we put product in outdoor kitchen displays are getting pretty huge in the hosts in the parking lot a at landscapers’ compounds. We promote states, but they’re just now couple times a year. Next year our outdoor kitchens on social media. filtering here to Canada,” he Eric Breckman. the team is looking to bring We’re just touching the tip of it. The more says. The store is up between in more accessories and add projects we put out, the more people see 10% and 15% with Green Mountain Grills spices and seasonings. it and want it.” pellet cookers this year. He says they have When veteran patio furniture retailer It seems to be working. According to not received many calls for charcoal, so they Phil Squarie, Jr. opened Luxe Barbeque Squarie, sales of built-in components to don’t carry kamados or other charcoal grills, Company in Winnipeg three years ago, landscapers and contractors for pricey adding, “We are happy with gas and pellets.” business grew on a seemingly unstoppable custom projects are up, as are sales of the it’s pretty hard to advertise price, so you must get the customer in the door first.” Christenson says he “doesn’t do politics,” but is bracing for potential fallout from the tariff situation. “So far on the barbecue side, I’ve only received one price list, so I don’t know what to expect. On the hearth side, venting, fireplaces, and furnaces are all getting hit – in some cases increases are going into effect the next business day, so we couldn’t even stock up. “It puts us in a bad spot with customers for whom we’ve quoted prices. We try to stand behind our quotes, so that means it will come out of our pockets, but it’s getting more and more difficult. If we pass the increase along, I imagine it will have some customers second-guessing whether to go through with the project.” “Sales have been steady like always,” says Eric Breckman, Sales manager of his family’s business, LCL Spas in Winnipeg. “It’s been good this year.” In gas grills, the retailer took on the Jackson Grills line a

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more entry-priced Napoleon Oasis modular line. “It’s doing really well,” he says. He expects to pick up the NatureKast outdoor kitchen cabinetry line this fall. Squarie’s gas grill sales were down in the $399 to $799 price point and $999 to $2,000 ranges this year, previous price-point-sweet-spots. But the store’s best-selling high-end grills priced $2,199 and up, are even with last year. Sales of charcoal grills also are on par with last year. One change is the addition of Kamado Joe to the store’s ceramic kamado offerings; it continues to carry Big Green Egg. Squarie says the category held its own without any significant gains, and sales are now split evenly between the two brands. Sandy Melvin. Squarie plans to continue with a full roster of community events. For instance, the store is the title sponsor of the Winnipeg football team’s tailgate area. The highly visible Luxe Barbeque Tailgate features a variety of demo cookers and a pop-up shop with merchandise for sale. It’s a hub for fun competitions, raffles, giveaways, and cooking demos. The retailer also plans to “ramp up” social media efforts. “It’s hard to find time sometimes, so we are now encouraging our staff to use

Shepherd’s Outdoor Living Centre.

“The outdoor kitchen category is just starting to catch on in the store . . . more people are ‘staycationing’ and want a beautiful backyard for entertaining.” — Sandy Melvin Shepherd’s Outdoor Living Centre

their phones to promote the business,” he says. Expanded service offerings, including cooking classes and grill cleanings, are also on the agenda. “We are looking for ways to create a culture around our business,” Squarie says. “We want to be the place where people go for barbecues and outdoor kitchens.” The West – British Columbia Shepherd’s Outdoor Living Centre in Armstrong, British Columbia, enjoyed solid sales increases in 2018, according to co-owner Sandy Melvin. This is the fifth consecutive year of growth that began in 2013, when the bursting-at-the-seams outdoor seasonal department within the Melvin family’s Shepherd’s Home Hardware store was expanded into its own

new, dedicated, year-round building. “We had a good year this year; we sell a lot of barbecues here,” says Melvin. Their secret to success? “We commit to inventory and our staff knows what they’re talking about,” she says. “We don’t compete with the Walmarts and Home Depots. Our customers come to us because they want products that will stand up to the weather and last, and will cook their steak properly. We aren’t worried about online competition. People want to see what they’re buying and talk with salespeople about their options. We try to match customers with the right grill by asking about what they like to cook, their family size, do they think they’d use the rotisserie. You can’t get that from a computer.” In addition to both natural and propane gas grills, Melvin says they sell “a lot” of smokers and kamados. “We’re seeing a trend where people are going back to more traditional charcoal cooking. And [sales of ] pellet grills are definitely growing in the store,” she says. “We do demos on them and our sales guys own them, which helps when talking with customers.” The store has a built-in pizza oven on display and has sold “a few” over the years, but according to Melvin, it serves other purposes to justify the floor space. “It absolutely attracts a lot of attention and starts conversations in the store when we do after-hours events to treat customers and contractors to food and camaraderie. These events are good exposure for our business.” She says the outdoor kitchen category is just starting to catch on in the store, but interest is growing. “It’s taken awhile to gain some legs,” says Melvin, “but more people are ‘staycationing’ and want a beautiful backyard for entertaining.” The store offers design assistance and sells built-in barbecues, refrigerators, and other components. Given improved weather conditions over last year, Lyle Perry is having difficulty figuring out why barbecue sales at

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The Canadian Barbecue Business | Kerrisdale Lumber in Vancouver were not stronger this year. “Sales were pretty flat in $2,000 and under single units on carts,” the vice president of Operations says. On the flip side, Perry saw sales of high-end, built-in grills climb. “Like any new fashion or business trend, outdoor kitchens have taken longer to catch on in Canada, but now a lot more people consider them a good investment to differentiate Lyle Perry. their property,” he says. The retailer offers design assistance, sells built-in components, and connects customers with contractors who specialize in outdoor kitchen construction. In addition, Kerrisdale Lumber sells modular outdoor kitchen systems. “They are definitely catching on, especially when the customer does not have a designer involved in the project,” Perry says. “Modular kitchens are easy to conceptualize and are prefinished, so you don’t need to hire a mason or carpenter. You just pick the grill, appliances, and modular pieces, then pick the cabinet color and counter. There are a lot fewer steps involved and it’s hard to beat the quick turnaround. It gives people an easy button.” Another bright spot: pizza ovens. “We have never sold as many pizza ovens as we have this year,” Perry says. The retailer carries a wide variety of gas- and woodfired pizza ovens, but is seeing the greatest growth in freestanding, wood-burning units. “I think it’s the same theory behind why outdoor kitchens are gaining popularity – everyone wants to hang and party in the kitchen,” he explains. “It’s a fun way to spend an afternoon with family and guests. It’s pretty cool.” Though pellet grills are becoming increasingly strong sellers in the store, Perry says, they are cannibalizing kamado sales. “There is a certain customer who enjoys the romanticism of cooking with fire, wood, and smoke, and they will choose one or the other. We are predominantly a gas grill market so pellets are closer to gas. They’re more approachable.” Another reason the company is getting behind pellet grills, according to Perry, is because wood pellets are a renewable

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fuel source, something that is becoming a hot topic in their community. He says restrictions on natural gas permits in Vancouver have generated fears that the city might ban fossil fuel appliances. “New multifamily developments are not able to offer natural gas for grills or even indoor ranges,” he says. “Electric grills are allowed, but most are small and don’t perform well. I am excited about Twin Eagles’ new pellet grill. It’s feature heavy, user-friendly, and is a renewable-fuel appliance I would feel comfortable putting in a high-end outdoor kitchen.” Perry expects to do more event-based marketing next year, adding to the store’s current roster of monthly demos and a few nighttime cooking classes a year. “We’re finding that we can explain features to

Sales at The BBQ Shop in Port Coquitlam, BC, are on par with last year, according to owner Nash Shivji. He carries more than a dozen grill brands in a wide range of price points, but says the $1,000 to $1,500 range is the sweet spot, followed by grills in the $2,000 to $3,000 bracket. “Five or six years ago, we sold a lot more $4,000 to $6,000 units, but manufacturers have introduced lower-priced lines with good feature sets and they have taken away from the highest-end grill sales,” he explains. “People can now find quality in the $1,000 to $3,000 range. The sales have been redistributed.” Another trend, according to Shivji, is ownership of multiple grills – often both gas and pellet models. “The second grill used to be a charcoal smoker, then it went to a charcoal kamado, and now it has switched to a pellet grill,” he says. “People like the Wi-Fi controls and the ability to set it and forget it.”

Rogue R525SIB from Napoleon Grills.

death,” he says, “but if we show people how grills and outdoor living products can create an experience, we have a much easier time selling.” As a dealer, he is concerned about tariff-related price increases, but says he predicts “distributors will feel the pain in the first wave, and consumers will bear the burden ultimately. It’s unfortunate really.”

He is noticing that today’s customers are more knowledgeable about grills than ever, do their research online, and often know what they want to buy before even walking into the store. With that in mind, Shivji says he tries to keep the product mix fresh and drive traffic by stocking categories and brands that are catching on with bloggers, barbecue contest champions, local cooking schools, and other influencers.

“For instance, we carry Yoder pellet grills,” he says. “They are very high-end and have a big following. People come in asking for them specifically.” The store does “a good business” in outdoor kitchens. It sells built-in grills and components, and partners with a trusted local contractor who handles the construction. Shivji also carries the Napoleon Oasis modular system. When fielding inquiries about outdoor kitchens, he qualifies customers by asking if their budget is at least $15,000. “If they say, ‘No, it’s only $6,000,’ I refer them to Lowe’s. If they move up to $10,000, I know most will go for $15,000. We never had the $25,000 to $30,000 outdoor kitchen sale, but we have found that more people are able to spend $15,000. Focusing on that price point has broadened the market for us.” By asking customers another question – how did you find us? – the retailer discovered that the store’s website is the primary connection, followed by referrals. As such,

Shivji is paying more attention to developing an effective online presence, paying experts to optimize the website so the store “pops up high” when people are researching online. He says, at his daughter’s suggestion, they are now proactive in “humbly asking” customers if they would consider posting a review of the business. “People will often do that,” he says, “and it’s very helpful. Previously, we might only get a review if someone had a problem, and it ends up being a negative review. Now, good reviews are burying any negative reviews.” This spring, Shivji turned a plethora of negative local TV and newspaper reports about the danger of barbecue bristle brushes, into a positive for the store. He invited people to bring their old grill brush to The BBQ Shop and get a new bristle-less brush for free, including messaging about the promotion in already-scheduled advertising and on social media. He ordered 400 brushes initially, at a wholesale cost of $6.50 each, and the program proved

so successful, he extended it through Father’s Day with another 200 brushes. “People brought in awful looking brushes,” Shivji recounts with a laugh. “We’d ask for their name and email address and put them in our system. It was an opportunity to educate people about our grills and it generated a lot of sales. People didn’t always buy on the spot, but after going home and looking at their own grill, they’d often come back to purchase.” Shivji says ever-increasing competition is among his greatest business challenges. “There are more and more dealers in the metro-Vancouver area where you can buy the same products we carry,” he says. “And, some of our suppliers are selling in Big Box retailers, as well.” He is also noticing more customers declaring, because of political issues, that they won’t buy anything made outside of Canada.” On the subject of tariffs, Shivji says, “Price increases haven’t hit us yet, but I expect they will be coming soon.”

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| The Canadian Barbecue Business |

Shrine of Barbecue In Ottawa, partners have created a retail juggernaut with in-depth staff training, great customer service, and a fun atmosphere, and now they’re heading south (Florida?). By Lisa Readie Mayer

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f you phone Capital BBQ and happen to be put on hold, you’ll hear a recorded message: “Welcome to the Shrine of BBQ.” In fact, many consider a visit to this 30-year-old barbecue retail store in Ottawa, Ontario, Canada, an experience not to be missed. It starts as soon as you drive into the parking lot and see the exterior of the building painted with a dramatic mural of red, orange, and yellow flames flickering through a giant grilling grid. Before you can walk through the front door, you must pass a dozen grills lined up in the outdoor display and demo area.

“We are the only store in Ottawa that’s dedicated to the barbecue category. But it’s not just that we have a huge breadth of barbecue products. We invest in staff training.” — Chuck Shabsove

Inside is a griller’s heaven, packed with a vast selection of gas, charcoal, and pellet grills, kamados, smokers, pizza ovens, grilling tools, accessories, fuels, sauces, seasonings, outdoor kitchens, fire pits, and more. There is also an in-store, vented kitchen for live-action grilling demos, cooking classes, and clinics. The staff is a walking encyclopedia of barbecue and grilling know-how, well trained on all products on the sales floor and well-versed in all types of grilling and barbecuing techniques. In fact, nearly everyone on the sales staff is a certified Kansas City Barbeque Society (KCBS) judge. “The minute you arrive, you know you’re in barbecue mecca,” says Chuck Shabsove, president of Capital BBQ. “We are the only store in Ottawa that’s

dedicated to the barbecue category. But it’s not just that we have a huge breadth of barbecue products. We invest in staff training. “We have demo models of every grill we sell and the staff tests all of them, as well as every bottle of sauce and seasoning. It’s invaluable to be able to talk from personal experience, especially when you’re trying to sell a $3,000 or $4,000 barbecue, but even when someone just asks for a rub recommendation. We get so much positive feedback from our customers about our education and communication efforts. It sets us apart.” “We understand barbecues,” adds Joe Whitfield, co-owner of the business. “We enjoy engaging with customers and take the time to answer questions and talk recipes. We proudly display our KCBS diplomas and aprons in the store. I think it adds another layer of credibility.” This deep level of product knowledge and bend-over-backwards customer service has been a guiding principle since 1989, when Shabsove first purchased a foundering appliance and grill store called Capital City Appliance. Shabsove, had been working in his family’s garden center and figured selling and repairing appliances would be a more recession-proof, year-round business. “Appliances and barbecues would always need fixing, right?” he recalls thinking with a chuckle. “But then people stopped fixing things and we became a throwaway society.” Shabsove attributes the changing consumer mindset at the time to the influx of Big Box stores stocked with lower-quality, “disposable” versions of the appliances and grills he was selling. In an effort to better compete with the chains, the inherently creative thinker and problem-solver started a buying group in the mid-1990s to gain leverage for his store and other independent retailers. When two members of the group, Chadwicks, a former Sunbeam outlet store, and Hacks, a Black & Decker outlet store, both about six hours away in Hamilton, Ontario, were ready to fold, Shabsove bought the failing businesses in 2001 and merged them into one store, Chadwicks & Hacks.

Chuck Shabsove, president of Capital BBQ.

In 2005, he ditched the appliances at Capital City Appliance, rebranded as Capital BBQ, and shifted the focus to quality barbecues backed by excellent service and support, the kind of products and intangibles not available at chain stores. The strategy had a positive impact on business. Today, Capital BBQ generates $3.7 million in annual sales out of a 5,000 sq.ft. retail showroom. The Chadwicks & Hacks sister store has achieved steady growth as well, surpassing $4 million in annual gross sales of barbecues, fireplaces, and vacuums. It consistently earns local “Readers’ Choice” awards for best customer service, best fireplace shop, best vacuum store, and best grill store. “Our business has been around for over 60 years, and we have a reputation for customer service,” says Chadwicks & Hacks’ general manager and co-owner Gary Green. Green says Hamilton is a steel town, with more middle-income consumers compared to higher-income Ottawa, so demographics dictate differences in Click here for a mobile

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| The Canadian Barbecue Business |

The Capital BBQ Store.

product mix and sales trends at the two stores. For example, there is less demand for outdoor kitchens at Chadwicks & Hacks than at the Ottawa store. And, Green says, given that many in the Hamilton area work in the steel industry, there has been “a real backlash against China-built products” and a growing preference for made-in-North America brands. Also, since barbecues must share the store’s 5,500-sq. ft. showroom with fireplaces – a category that has been “growing tremendously” at the store – and vacuums, there is no room for a working demonstration kitchen or cooking classes. Barbecue Sales Trends Gas grills are the top sellers at both stores – they carry Napoleon, Weber, Broil King, Crown Verity, and DCS. According to Shabsove, the price-point sweet spot is $1,100 to $1,499 at Capital BBQ, but the store stocks grills for every budget, from $249 up to pricey premium models. He notes that while gas grill sales were up overall this year, there was “a little bit of a dip” in the highest-end units. “Manufacturers such as Napoleon have added interior and knob lighting, ceramic

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infrared burners, and charcoal trays, so people can get a good-quality barbecue with all the features they want, for less money,” he says. “These barbecues are a good value and are taking away from super-premium grill sales.” Whitfield says pellet grills are “really taking off. We have noticed a big difference this year.” The retailer carries “good, better, best” lines from Traeger, Memphis, and Yoder. “People like the Wi-Fi features, and the wider temperature ranges now make pellet grills more versatile for year-round use in Canada,” he says. According to Green, pellet grill sales are up at Chadwicks & Hacks, too. “They are very easy to use,” he says, “and quite frankly, women prefer them over charcoal kamados.” In fact, the growth in pellet grills seems to have come at the expense of kamados in both stores, according to Shabsove. Capital BBQ dedicates two rooms to Big Green Egg, Primo, and Kamado Joe cookers, accessories, charcoal, and woods, but he says kamado sales declined slightly this year. “They’re everywhere now – at pool and spa dealers, garden centers, Big Box stores, Costco road shows,” he says. “The increased competition hurt our sales.”

Pizza ovens have been an unexpected bright spot. “Previously, we weren’t able to get much traction with the category,” Shabsove says, “but, this year we had really good success with the Fornoteca Duetto oven. It has two gas burners beneath the pizza stone, and the stone continually rotates so it heats evenly, gets up to temperature in 10 minutes, and cooks a pizza in 90 seconds. A wood-fired oven with the fire at the back takes two hours to get to temp, and you need to manually rotate the pizza because of hot and cold spots. “The Fornoteca oven is portable and affordable ($2,100 Canadian) and we sold quite a few units this year. It’s been very successful with homeowners, and even golf courses and restaurants.” Outdoor kitchens also are trending at Capital BBQ. “We are a few years behind the U.S., but interest is really starting to grow,” says Shabsove. “People are ripping up their yards, putting in pools, outdoor kitchens, fire pits, electric heaters. The more outdoor kitchens we do, the more referrals we get, and it compounds the growth.” While the store has partnered with a local construction outfit on custom projects for years, Shabsove says changes are afoot

in the category. “We’re seeing a lot fewer stone islands lately, resulting in a dip in our built-in door and drawer component sales. Now, customers are really attracted to modular outdoor kitchen systems. They’re lighter weight; you don’t need a stone guy or framing guy; there are more finish options to choose from, and you can have it now and don’t have to wait.” Last winter, the store’s sales team attended a hands-on training session for Danver and Brown Jordan Modular Outdoor Kitchens at the Danver headquarters in Connecticut. “Seeing how they’re made and meeting their designers helped our team understand the line better and be more confident selling a $30,000 or $40,000 outdoor kitchen. We are up 200% in Danver kitchens this year, which we attribute to the training.” Capital BBQ also carries Napoleon Oasis modular systems. “It’s a very good price point,” says Whitfield. “We show customers how they can create an outdoor kitchen that’s comparably priced to a large cart barbecue. We tell them, ‘If you ever move, you can take it with you, or if you outgrow it, you can sell it on Craigslist and get a new one.’” Attracting Barbecue Pilgrims to the Shrine Their own in-store, live-demonstration grilling kitchen is busy with free classes and clinics most weekends throughout the

Weber grills.

year, often hosted by guest chefs from the Canadian Culinary Federation, an organization to which the store belongs. “Professional chefs with our equipment, it’s a great mix,” says Shabsove. “The events bring people to the store. They ask questions, get inspired about what they can cook on our barbecues, try out new sauces and rubs.” The store also ties in with experts from the Canadian BBQ Society to teach competition-style barbecue clinics. But customers don’t have to wait for a class to see grills in action. “We offer test drives any time,” says Shabsove. “We’ll supply the food, or customers can bring their own and cook. If a salesperson is talking with someone about a grill, they can say, ‘Hey, do you want to try it?’ It helps close the sale.” This is just one of many ways in which Capital BBQ tries to differentiate itself from the competition. Another is product mix. According to Shabsove, the store’s membership in the 280-independentretailer-strong United Buyers Group, provides access to exclusive barbecue lines and special-edition colors and features not found in other stores. Shabsove and Whitfield regularly revamp the Capital BBQ showroom to “keep it fresh.” And they have expanded their service offerings, making annual barbecue tune-ups available to customers, in addition to ongoing customer service and support.

“In the age of social media, good service is a chance to really shine,” notes Whitfield. “If we do a good job, customers will tell their friends and post about their positive experience. Most of our customers have been referred to us or find us while researching online.” This summer, the store used social media to turn local news reports about stray grill-brush bristles getting lodged in food, into a sales opportunity. “Every time the

Kamado Big Joe 24 inch.

Outdoor heaters and accessories.

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| The Canadian Barbecue Business | issue was in the news – and it was frequently – we would repost the story with a link to our website page about bristle-less brushes,” Shabsove says. “We had very good success with that. We sold bristle-less brushes like they were going out of style.” Next year, they plan to expand social media efforts with a food blog to drive visits to their online store, BBQing.com. Launched in 2015, the site sells a broad array of barbecue grills and accessories, for shipping only within Canada. Their second Internet site, BarbecuesandGrills.com, is dedicated to Napoleon grills; it has warehousing in the States and ships to both the U.S. and Canada. Shabsove says they hope to expand their BBQing.com marketplace to the States, as well. “If you want to exist in this online business, you need to be south of the border,” he says. “We are looking to buy an established brick-and-mortar location in the States, somewhere in a warm climate, accessible by direct flight – maybe Florida.”

According to Shabsove, online sales in the U.S. could “get more complicated” in the coming year, due to uncertainties about sales-tax collection. Tariffs could add another potential hurdle. “On the fireplace side, we’ve already gotten notification that venting is going up 25%,” says Green. “I think that will really impact fireplace sales. But there are so many moving parts and we still don’t know how it will all shake out. It’s a lose-lose situation and very unfortunate for everyone.” In the meantime, Capital BBQ will continue to use clever marketing infused with humor and wacky antics, to stay ahead of the competition, gain customers, grow sales, and reinforce its message that this is indeed a shrine to barbecues. Case in point: For an ad campaign, splashed across 40 Ottawa city buses from April through September, Shabsove donned a Superman costume and held up a grilled chicken under the tagline, “We Create Backyard Heroes.”

A high-energy television commercial featuring “Ribeye Joe” Whitfield taking viewers on a mad-dash tour of the store, and strumming a Big Green Egg guitar, aired during NHL hockey playoff season. Shabsove says the spot was one of its most successful marketing efforts ever, generating tremendous customer response and directly attributable sales. “The day after it first aired, one gentleman came in and spent $5,000,” he recalls. “He had been watching the game with his brother, saw the commercial and said, ‘Hey, we both need new barbecues,’ and he came in the next day. It was quite amazing.” The spot scored great post-season play as well, racking up 300 views online. “We’ll definitely be doing more videos this year,” Shabsove says. “Creativity and innovation are the best ways to stick out from the competition and send the message that this store is fun,” he adds. “And life is too short not to have fun.”

Store Name: Capital BBQ

Phone: (613) 228-0009

Chadwicks & Hacks: 5,500

Street: Grenfell Crescent, Ottawa, Ontario

Annual Revenues: Capital BBQ: $3.7 million Chadwicks & Hacks: $4 million

Lines Carried: Barbecue: Broil King, Big Green Egg, Crown Verity, DCS, Kamado Joe, Memphis Wood Fire Grills, Napoleon, Primo, Traeger, Weber, Yoder Hearth at Chadwicks & Hacks: Amantii, Bionaire, Dimplex, Heat & Glo, HPC, Majestic, Napoleon, Regency, Timberwolf, Valor, Vermont Castings

Number of Stores: 2 Sister Store: Chadwicks & Hacks Owner: Chuck Shabsove and Joe Whitfield (Gary Green is a partner in Chadwick & Hacks) Yr. Established: 1989 Web Site: www.bbqing.com E-mail: chuck@bbqing.com

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Number of Employees: Capital BBQ: 12 in high season, 6 in low season Chadwicks & Hacks: 6 Sq. Ft. of Building Space: Capital BBQ Showroom: 5,000 Capital BBQ Warehouse: 8,600


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| Manufacturing |



By Lisa Readie Mayer


n the late 1980s, California-based DCS (Dynamic Cooking Systems), a manufacturer of restaurant appliances, shook up the backyard barbecue industry with the introduction of commercial-quality, high-end, stainlesssteel barbecue grills. The grills were sleek, sexy behemoths of gleaming metal that performed like professional appliances and appealed to serious cooks. The elevated design struck a chord with luxury homeowners searching for a suitably sophisticated grill for their patios. With that line, DCS is credited with establishing the high-end grill category and launching the trend of stainless-steel grills. Sales took off, so much so that the company got out of the commercial appliance business to focus on its burgeoning line of outdoor appliances, and added to it a line of premium, residential indoor appliances. DCS cemented its position as a leader and innovator in the premium outdoor cooking category by expanding into storage doors and drawers, refrigeration, beer dispensers, beverage coolers, sideburners, and other components for outdoor kitchens.

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In 2004, the company was purchased by premium appliance manufacturer Fisher & Paykel, and rebranded “DCS by Fisher & Paykel.” New Zealandbased Fisher & Paykel’s history dates back to 1934 when Olive Paykel asked her husband to import refrigerators from the U.S. after seeing them advertised in a Ladies Home Journal magazine. He continued to import refrigerators, and later washing machines and other appliances, from America until the New Zealand government prohibited the practice. Appliance parts were not included in the ban, however, so the company resourcefully secured a licensing arrangement with its U.S. appliance suppliers, and began importing parts and assembling the units in New Zealand. Fisher & Paykel went on to design and manufacture appliances under its own brand name and established a reputation for quality and innovation. According to the company, it pioneered the first dishwasher drawer, the first multitemperature refrigerator drawer, and a smart refrigerator that automatically adjusts airflow to maintain stable temperatures and help food last longer.


DCS by Fisher & Paykel, a luxury grill pioneer, is moving rapidly and smartly into the future.

Ludo, one of DCS’ ambassadors, cooking on a Series 9 grill (36"), with two refrigerator drawers and kegerator.

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| Manufacturing | “DCS was a smart fit,” says Scott Davies, Fisher & Paykel’s director of Strategy. “It had always been an innovator, had very good brand recognition, and was well respected in the outdoor space, and that appealed to us. Getting into outdoor appliances made sense because New Zealanders are very social, outdoorsy, adventure-driven people. The country only has 4.2 million people; it’s a very small island. But it has lots of greenery and a big outdoor culture. It made sense to bring outdoor appliances into our family of products.”

with competition, and stainless-steel finishes had become the norm for both premium grills and the myriad of low-priced imitators being made overseas. Although still widely respected and recognized for quality and performance, the once cutting-edge DCS line had not always kept pace with the new products and innovative features offered by its competitors. “The first thing we did (with the DCS brand) was refocus on quality and manufacturing,” according to Davies. “We are at the high end of the market and

The Fisher & Paykel Experience Center in Costa Mesa, California, with the Series 9 grill.

In 2010, Fisher & Paykel underwent a major, company-wide brand refreshment. After researching how people cook and use their kitchens, and how the role and look of the kitchen is changing, the company established a new philosophy on which all product designs are based – The Social Kitchen. The Social Kitchen “The Social Kitchen is where people live and interact,” Davies explains. “It’s where food experiences are created; those experiences begin when you start to cook, not when you sit down to eat. Whether it’s inside or outside, the kitchen is the hub and center of a home. Everyone huddles around the stove, the grill, or the fire pit.” While DCS grills and outdoor kitchens clearly dovetail with the Social Kitchen philosophy, Fisher & Paykel entered a barbecue category that had changed dramatically since the first DCS grill was introduced. The marketplace was flooded

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consumers have high expectations in terms of product durability when they’re spending that much money on a grill. So we invested heavily in improving quality and design. The aesthetic, too, has evolved to have a more modern, upscale style. “In addition, we tightened up the distribution model,” he says. “Originally, DCS was sold through outside distributors in a whole bunch of channels. Now, there are no third-party distributors; we control the entire process. We have our own warehousing and our own sales team and they concentrate on two key channels: traditional appliance dealers and hearth, patio, and barbecue dealers. These two groups are the leaders involved in creating outdoor kitchens and outdoor spaces.” DCS by Fisher & Paykel has significantly amped up R&D in recent years and unveiled its new Series 9 grill line at the HPBExpo last March. Series 9 grills have the same cooking system as the company’s Series 7 line, but include a stepped-up feature set with

interior and control-knob lights, flexible warming rack systems, warming pan inserts, two-position charcoal tray inserts, and selfcontained rotisserie storage beneath the drip tray. Optional features include a griddle surface, infrared sear burner, and a six-inchwide built-in cabinet for storing extra grids, inserts and accessories in outdoor kitchens. “Series 9 has given us an ultra-premium line,” says Justin Monroy, the company’s Market Development manager, Outdoor Sales – USA. “It has inspired some of our former dealers to jump back on and support us. A lot of people have taken notice and the line has been very well received.” Its Liberty Collection modular outdoor kitchen system, introduced some years back, has been newly revamped, as well. It offers a selection of modular grills, refrigeration, storage units, and other components that link together to create custom-configured outdoor cooking islands. The line exemplifies the concept of “social grilling,” according to Monroy. Grills, sideburners and all other modules in the Liberty line were intentionally designed without high-profile lids to encourage a 360-degree view from all sides, inviting guests to gather ’round, cook, and socialize. While Fisher & Paykel appliances are sold in 50 countries around the world, DCS by Fisher & Paykel outdoor appliances are available only in the U.S., Canada, New Zealand, and Australia. “The premium market is very, very small in New Zealand and Australia,” Davies says, “so we are focused on aggressively growing our market share in the U.S. and Canada.” To help accomplish that goal, the company has stepped up marketing efforts. “We’re at the point where our indoor and outdoor product offerings are now very competitive and we have our sales representation in place, so we are ready for the next step,” Davies explains. Eventually the company’s marketing efforts will target consumers directly, but for now it is focused on reaching influencers. To that end, Fisher & Paykel has opened five Experience Centers globally, including Toronto, Costa Mesa, California, and New York City, each with a section dedicated to DCS by Fisher & Paykel grills and outdoor kitchens. “Our core audience at these centers is the design and architect communities,” says Davies. “The Experience Centers give

It’s in the works and should be available six to eight months down the road. Monroy says the sales team further supports dealers by hosting demos, and the company is looking at developing cooking classes for consumers. The pair says the company also is helping dealers navigate the e-commerce channel. “E-commerce is evolving very quickly and most manufacturers and retailers are trying to figure it out,” says Davies. “We are loyal to a fault to our retailers. You must have a retail storefront to be able to sell our product online. But if a dealer has an online presence,

The New York Experience Center.

us the ability to create a full brand immersion; to take the customer through our best-in-class products, company history, and backstory of what makes us unique. In a dealer setting there are many other brands. Here, there is no sales mentality or pressure; just education and inspiration.” The company opened its first Experience Center in 2014 in Toronto’s International Design Centre, a one-stop-shop for design professionals. The Costa Mesa center offers 6,500 sq. ft. of indoor and outdoor kitchen vignettes and the opportunity to take cooking classes hosted by the resident chef. The New York City Experience Center, located in the Architects & Designers building, has multiple indoor appliance vignettes, as well as a set of floor-to-ceiling sliding glass doors that open to a simulated penthouse- or balcony-sized outdoor living area with wood decking and seating. The area features an outdoor kitchen with built-in DCS grill, sideburner, beverage center, and storage. A DCS cart-based grill is also displayed. “The outdoor kitchen concept is growing across the nation,” according to Monroy. “Retailers who previously just put cart models on the floor are now putting built-in islands on display. This allows us to showcase our storage options and other built-in components, and it has really increased the attention on outdoor kitchens and the size of the sale for dealers.” He says sales of the company’s Liberty outdoor kitchen system also have spiked. “It

answers a need for many consumers. The separate modular pieces can be put together to create a customized outdoor kitchen; there is flexibility to move it around or reconfigure it into a different layout; and you can put it on a deck, rooftop, or balcony. It offers easy installation and a faster turnaround. It is a fundamental solution for consumers who don’t want the look of a traditional rock island. I do believe there is a growing market that is taking the indoor kitchen look outside, and you can get that with the Liberty line. It’s all a matter of personal preference and depends on the look you want.” Monroy and Davies say the company provides design assistance to retailers and designers creating outdoor kitchens for customers. “Our team is fully trained in designing outdoor kitchens,” says Davies. “We have some sample designs available as starting points, and our sales staff can help retailers and designers to use 3-D design software such as Google SketchUp. We are creating our own online design platform.

we want our brand to be represented as best as possible on their website; we want a premium online experience. “There are three or four big online players in the U.S., but the others are very small,” he continues. “Overall, e-commerce is still a minority in terms of total grills sold. We are primarily sold through dealers. In the area of the market we play in, our customer is very unlikely to spend $3,000 to $10,000 or more on an outdoor kitchen without seeing the product before they buy it.” As for the future, according to Monroy, while the brand introduced charcoal inserts this year, and there is charcoal grilling and smoking capability on the new Series 9 grills, it remains loyal to its gas-grill heritage. “We are very clear about who we compete with and who we don’t,” he says. “We want to stay true to our brand. A few grill brands disappeared with the economic recession some years back. We are committed to growing our brand and infrastructure and winning here in the U.S.”

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A P u b l i c at i o n O f T h e H e a rt h , P at i o & B a r b e c u e A s s o c i at i o n

Get to Dallas and Get Set to Go BIG!


verything really is bigger in Texas, which makes it the perfect location to celebrate HPBExpo’s 40th year. In that spirit, HPBExpo 2019 is gearing up and getting set to Go BIG! From big buyers and big leads to big trends and big ideas, North America’s largest indoor-outdoor living industry show is coming to Dallas for the very first time.

category is on a fast pace to being a $9.1 billion industry, according to the Freedonia Group research firm. Consumers are showing an intensifying desire for the highest-quality products to complete the vision they have for their ideal space. Home chefs are adding artisanal techniques to their grilling and looking for both high-performance and specialty products, such as pellet grills and kamado smokers. Outdoor entertainers are demanding furniture styles that keep up with the trends they see on HGTV or in the pages of Architectural Digest. They’re also seeking to maximize the use of their investments and are stretching the outdoor living season into cooler weather.

That means warmth and lots of it, including fire pits and radiant heaters. HPBExpo is the place where you’ll see, touch, smell, hear, and taste all of these products that your customers will be demanding. All of the biggest trends are here and when you attend the show, you’ll get to hook your wagon to them before your competition does. HPBExpo isn’t just products – it’s the people who live and love them. With hundreds of exhibitors and thousands of professionals from every facet of indoor-outdoor living, attending HPBExpo is walking into an eCommerce site. But,

HPBExpo 2019 takes place March 13-16 at the Kay Bailey Hutchison Convention Center right in downtown Dallas. To date, manufacturers of every size worldwide have already answered HPBExpo’s call to “Go Big” and they’re getting set to bring their innovative products to the buyers in one of retail’s fastest-growing segments. In 2019, the indoor-outdoor living market is forecast to rise to $9.1 billion. With the lines between indoor and outdoor living continuing to blur – and the needs and wants of consumers continuing to trend toward sophistication – our

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With hundreds of exhibitors and thousands of fellow attendees, you won’t want to miss HPBExpo 2019 in Dallas, Texas!

All routes lead to Dallas.

this is your chance to actually touch, feel and see the products for yourself, meet the people behind the products, and have all of your questions answered; you simply can’t feel the heat from a fireplace or check the comfort of a sofa cushion if you’re stuck behind a desk.

Dallas’ central U.S. location makes it super convenient from just about anywhere and is a fairly inexpensive city for both business and leisure. Early spring – when HPBExpo takes place – is the best time to visit while temperatures are perfect for a stroll around downtown. If you’ve got a green thumb (or enjoy seeing the fruits of those who do), Dallas Blooms at the Arboretum will be taking place at the same time as HPBExpo. Comprised of more than 500,000 blooming spring bulbs, this spectacular display is one of the biggest in the world.

Networking is another valuable benefit of HPBExpo. By chatting with your peers, you’ll learn about what’s happening in their businesses, and could walk away with solutions to your own challenges. You’ll also make critical connections you never thought possible and reinforce your role in this amazing community. No matter how far HPBExpo attendees travel, they always arrive home excited, refreshed, and ready to sell. The HPBExpo Education Program is legendary, and for good reason. It ’s the most comprehensive and up-to-date program available in the industry. Classes take place just steps from the show floor, giving you the best of both worlds in one easy trip. You can also earn CEUs and certifications. Through the HPBExpo Education Program, you’ll explore the latest business strategies, brush up on your technical skills, and find out about important regulatory changes for the industry. In addition to practical classes on installation and repairs, topics covered in 2019 in Dallas will include: conquering your fear of social media, marketing the outdoor room, making the most of your website, learning succession strategies, and using aftermarket parts on existing installations.

Mike Holmes, star of HGTV and the DIY Network, will deliver the HPBExpo 2019 Keynote Address, sponsored by Napoleon Products.

HPBExpo 2019 is scheduled to start on a very high (key)note. The DIY Network’s Mike Holmes will deliver HPBExpo 2019’s Keynote Address. As the host of HGTV’s Holmes on Homes, Holmes Inspection, and All American Handyman, he knows this industry and he’s ready to get the crowd fired up about the newest housing and product trends, the critical role the fireplace plays as the heart of the home, and how to entice homebuyers with outdoor products. Sponsored by Napoleon Products, the Keynote is set to take place on Thursday, March 14 from 8-9:15 am before the show’s official opening.

The HPBA Journal is intended to provide in-depth information to the hearth and outdoor products industries. Statements of fact and opinion are the responsibility of the authors alone and do not necessarily reflect the opinions of the officers, board, staff or members of the Hearth, Patio & Barbecue Association.

Dallas is continuously growing and has the largest urban arts district in the nation. Covering over 20 blocks, this hub of creativity features art for all the senses, including award-winning museums, performing arts venues, and plenty of restaurants and bars. The Dallas Farmers’ Market is considered to be the market of the future and is the perfect place to sample Texas’ diverse cultures and flavors. A trip to Texas is also incomplete without barbecue; and craft-barbecue scene is now all the rage in Dallas. In fact, you’ll find some of the reportedly best brisket in town just blocks away from the convention center at Pecan Lodge. You’ve got to go here if you want to get anywhere. HPBExpo 2019 registration is now open, and discounted rooms in the hotel block will go fast. If you’ve never attended HPBExpo, the 2019 show is the one you can’t afford to miss. “Go Big” and you could enjoy your best year yet. Visit hpbexpo.com for more information.

Copyright ©2018 by the Hearth, Patio & Barbecue Association. All rights reserved. Reproduction in whole or in part without written permission of the Hearth, Patio & Barbecue Association is prohibited. Direct requests for permission to use material published in the HPBA Journal to media@hpba.org.

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| Industry News |


Contour has the ability to fit to any shape or angle, making a variety of end products possible. Craftsmen can expand their offerings with shade sails and other shade structures. Featuring 15 colors, the fabric is a rich, knit texture. Call (336) 221-2211 or visit www.sunbrella.com.

Drolet By (SBI) Stove Builder International

Aupa Plancha

The Aupa Plancha grill has a smooth, stainless-steel solid cooking surface, removable grease tray, and powder-coated cover. Foods cook in their own juices, retaining flavor; the solid grate heats food evenly. The two-burner grill cooks for up to 10 guests and the three-burner grill has a cooking surface for up to 16 guests. Call (404) 228-5304 or visit www.aupaplancha.com.

Mistral is an outdoor wood-burning fireplace made of 1.6 mm thick steel sheets, coated with a powder paint. The coating is seven times more resistant than regular paint. Four panels go together easily and rest on a sturdy and stable base, offering a 360-degree view of the fire with enough room to fit a 20-in. log. Call (877) 356-6663 or visit www.drolet.ca.

RicoRock Bask Outside

Made from recyclable polyethylene plastic using a rotational molding process, the Costarondack is weather resistant and easy to clean while maintaining a beautiful appearance and comfort. The chair also has handy cup holders. Call (830) 249-8947 or visit www.baskoutside.com.

78 | OCTOBER 2018 | www.hearthandhome.com

The Waterfall Bench has a built-in fire option and is designed to ‘plug-n-play’ for easy installation. Homeowners can order the bench with a 12- or 24-in. ColorFall spillway waterfall and a 24-in. Linear Fire Effect. The propane tank is hidden within the hollow cavity of the bench. Call (888) 717-3100 or visit www.ricorock.com.

Lloyd Flanders

The All Seasons Collection embraces new traditional style, with built-in reticulated foam seating that allows moisture to drain quickly from cushions. The wicker collection offers a cushioned seat option, and includes deep seating, dining, bar and balcony choices. Homeowners can choose from 20 finishes. Call (800) 526-9894 or visit www.lloydflanders.com.



Place An Order Of $1700 Or More And Receive

Free Freight

Anywhere In The Continental U.S. See all our stocked products in the 2018-2019 Sand Hill Wholesale Catalog. Contact us for your free copy Stone Forest

The Segmented Boulder is carved from a solid natural granite boulder. For a graphic and unique twist, it is segmented, creating a new take on the classic boulder fountain. Each piece emphasizes the boulder’s natural shape. Call (888) 682-2987 or go to www. stoneforest.com.

1-888-SAND-HILL Fax

1-800-958-5497 E-mail

info@sandhillwholesale.com www.sandhillwholesale.com Click here for a mobile

friendly reading experience www.hearthandhome.com | OCTOBER 2018 | 79

| Industry News | Calcana USA

Gas fired, high output patio heaters operate from mild to heat-wave hot at the turn of a dial. Features of the units include overhead and sidewall mounting capabilities, no glowing parts, easy light, three-try, electronic ignition and a low voltage control panel. Call (800) 778-6729 or visit www.calcana.com.

Kalamazoo Outdoor Gourmet

The Hybrid Fire Grill uses gas, wood and charcoal interchangeably, in any combination. Chefs can sear, smoke and roast on the same freestanding grill. The temperature ranges from 250 to over 1,000 degrees. Custom grill grates have three patterns for cooking different foods. Call (888) 229-6952 or visit www.kalamazoogourmet.com.

The Companion Group NatureKast

The Evo Cooktop Combination Cabinet is weatherproof and has a unique radius-match, bowed drawer front to allow for maximum storage space under the versatile cooktop. Call (844) 880-6314 or visit www.naturekast.com

The Charcoal Companion Attachable Sun Shade for gas grills clamps securely on the side of a grill. It can be adjusted to 90-degrees horizontal or 360-degrees vertical. The shade also can be clamped to a picnic table, patio railing or anyplace cover is requested. Call (800) 521-0505 or visit www.companion-group.com.

Cleveland Whiskey

Music City Fire

With striking lines and angles, the Resonate is handcrafted from lightweight glass-fiber-reinforced concrete supported by a lightweight aluminum chassis. The finish is smooth and comes in a single color or two tone. There is also a glass windguard for the 36-in. burner. Call (866) 615-6232 or visit www.musiccityfirecompany.com.

SMOKER BRICX are made from finishing woods such as apple, black cherry, sugar maple, American white oak, hickory and honey locust. The BRICX are packed wet and fresh, and are full of aroma and flavor. They are solid wood with no sawdust, bark or fillers – except bourbon. Call (216) 881-8481 or visit www.clevelandwhiskey.com.

Exterior Elements Outdoor Living

The Palm Sectional has a modern design that is comfortable and brings indoor comfort and style to any Outdoor Room. The frame is powder-coated aluminum and cushions are quick dry and come in a choice of fabrics and colors. Call (519) 636-3921, or go to www.exterior-elements-outdoor.com.

80 | OCTOBER 2018 | www.hearthandhome.com

Introducing the ALL NEW

Cajun Preaux Built-in Grill & Cart ($2,998 MAP)

Some Distributor Territories Still Available

The Cajun Preaux Built-in Grill ($1,799 MAP) was designed with the professional BBQ’er in mind: ALL 16 GA 304 STAINLESS STEEL featuring dual 12 GA coal trays and almost 750 inches of cooking area. Dual exhaust and combustion air vents, up front coal tray controls, and electropolished SS cooking grids round out this beautiful grill. Function precedes beauty in the Cajun Preaux Cart ($1,199 MAP) with dual drawers, dual folding shelves, commercial casters, and air cooled designed cart.

Check out our NEW all stainless steel grill line at www.cajungrill.com (337) 233-6808

| 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.

RETAILER SALES - U.S. AND CANADA August 2018 vs. August 2017










Retailers Up







58% Retailers No Change

Retailers Down

Eighty-three percent of Hearth retailers, and 75% of Spa retailers were either UP or the Same, while Patio and Barbecue were at 86% and 87% respectively.

13-MONTH YEAR-OVER-YEAR RETAIL SALES August 2018 vs. August 2017


HEARTH 13% 12%

11% 10% 8% 9% 10% 8% 10% 6% 7% 9% 2%


2% 4% -1%

8/17 9/17 10/17 11/17 12/17 1/18 2/18 3/18 4/18 5/18 6/18 7/18 8/18


4% 8% 5% 1% 4% 3% 0%

3% -3%

8/17 9/17 10/17 11/17 12/17 1/18 2/18 3/18 4/18 5/18 6/18 7/18 8/18

SPAS 8% 5%

4% 3% 6% 2%


24% 7% 2% 2% 5% 5%



25% 10%


8% 5%

12% 13% 2%

5% 5%

-5% 8/17 9/17 10/17 11/17 12/17 1/18 2/18 3/18 4/18 5/18 6/18 7/18 8/18

8/17 9/17 10/17 11/17 12/17 1/18 2/18 3/18 4/18 5/18 6/18 7/18 8/18

In August, the Hearth season kicked off with a 10% gain over the same period a year ago. Patio products were up a strong 7%, Spas had a 5% gain, and Barbecue sales were flat.

82 | OCTOBER 2018 | www.hearthandhome.com

RETAILER COMMENTS NORTHEAST Connecticut: (Hearth) “Better year thus far than last few – across the board, wood, pellet, and gas. Some people who bought this year came in two years ago just looking. They’re tired of the long, cold, expensive winters. Looks like a good year on the horizon.” Connecticut: (Hearth) “After a slow June

and July and a good August we are still up for the YTD.” New Hampshire: (Hearth, Patio) “Economy

is great! Not only are sales up, but customers are spending their own money and not credit.”


For the following weather charts, the numbers for each state reflect the temperature ranking for the period since records began in 1895.



67 90

118 105 118 106

118 67


118 116 Record Coldest

Much Below Average

123 124 94 124 121 102 124 52 114 124 119 76 108 123 34 94 97 124 102 108 123 81 122 123 72 39 124 100 70 94 74 124 121 98 102 124 52 45 51 114 71 124 119 1 = Coldest 72 69 76 124 = Warmest 108 123 34 97 94 124 102 108 8394 81 122 72 39 101 100 74 98 45 51 National Climatic71 Data Center/NESDIS/NOAA 1 = Coldest 72 69



90 116


New Jersey: (Hearth, BBQ) “Hearth

products are up for a hot month! Customers who came in just looking last year are coming in to purchase this year! Our weather is so up and down almost daily that we are happy to see this.”




109 61 92 109 Below Average


94 Average





Warmest Much 124 =Record Above Average Warmest


New Hampshire had a Record Warmest August, as did Massachusetts, Rhode Island, Connecticut and Delaware. National Climatic Data Center/NESDIS/NOAA

New Jersey: (Hearth, Patio, BBQ)

“August was down from the previous month, but still strong. The season has changed so time is up.” New York: (Hearth, BBQ) “We had some

bursts of sales but the momentum just did not continue.” New York: (Hearth, Patio, Spas) “Here

in Upstate New York, I would have been better off being in the Ark-building business! We’ve had 300% more rain than normal for August! Sheesh!” Pennsylvania: (Hearth, BBQ) “Too

much rain for outdoor product sales. We expect strong hearth sales and some outdoor projects this fall if it stops raining.”

Record Coldest

Much Below Average

Below Average

Near Average

Above Average

Much Above Average


120 Warmest 120 112 121 89 104 106 123 119 STATEWIDE AVERAGE TEMPERATURE RANKS 103 116 124 85 108 113 120 109 104 June 2018 - August 2018 94 120 108 74 99 95 119 108 113 123 120 124 97 113 120 112 122 87 108 121 116 89 104 123 103 106 123 119 109 103 116 94 104 124 85 108 113 91 123 123 104 120 109 1 = Coldest 100 94 94 124 =120 Warmest 108 74 95 120 119 108118 11599 123 113 124 97 113 122 87 108 116 123 103 109 94 104 123 123 91 National Climatic Data Center/NESDIS/NOAA 100 94 1 = Coldest Record Coldest

Much Below Average

Below Average







124 = Warmest Much Record Above Average Warmest 118

Pennsylvania: (Hearth) “September is

starting out good.” SOUTH

Arkansas: (Hearth) “August ended up

being a good retail month for hearth products thanks to a few remodeling projects involving vent-free gas. Too hot for wood and pellet products. Waiting for fall!”


National Climatic Data Center/NESDIS/NOAA

Record Coldest

Much Below Average

Below Average

Near Average

Above Average

Much Above Average

Record 111 Warmest 100 120 107 115 85 78 109 90 In the three-month period June to August, the vast 77 majority of states experienced 123 107 71 116 94 Above Average to Much 98 Above Average temperatures. The exceptions Rhode 84 were112 76 105 Island and Utah, with Record Warmest temperatures, and Nebraska with Near Average 57 70 68 54 110 temperature. 58 84 111 118 108 40 89 100 120 93 53 53 107 90 115 85 122 78 42 90 Click here 93 for a mobile 109 123 107 3877 71 33 116 94 96 friendly reading 100 77 www.hearthandhome.com | 1OCTOBER 112 2018 | 84 experience 98 40 = Coldest 41 76 124 =105 Warmest 57 70 54 60 68 110 58 47 118 84 117



10 83

28 28



| Business Climate |

increased in August, following a modest

130.8 122.9

133.4 127.1 127.9

increase in July. The Index now stands at 133.4 (1985=100), up from 127.9 in July. 110 “Consumer confidence increased to its highest level since October 2000 (Index,

Iowa: (Hearth) “August sales in our area

Economic Indicators at The Conference

are always relatively flat most years, not until September and October do sales hit. There seems to be more customers inquiring this August than in other years. We are a pellet stove dealer for the most part, so it almost always takes some cold weather to break people loose.”

Board. “Consumers’ assessment of current business and labor market conditions improved further. Expectations, which had declined in June and July, bounced back in August, and continue to suggest solid economic growth for the remainder of 2018. Overall, these

Michigan: (Hearth) “Home remodels and

historically high confidence levels should

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.

“We are already scheduling three weeks out. Hold on my friends, it’s gonna be a crazy fall season!” — Oklahoma

Florida: (Patio) “Our sales were better

last year, even with hurricane Irma around and no power for six days… Add to that, 1. Dead floating manatees. 2. Turtle carcasses. 3. The Red Tide smell. 4. Dead and rotting fish. Beachfront property is getting cheaper by the day! The Sunshine State has had 55 days straight of rainfall!”

84 | OCTOBER 2018 | www.hearthandhome.com

MIDWEST Illinois: (Hearth, Patio, BBQ) “Seemed a little slower than last August. A lot of people on vacation I think.” wood stoves than the past few years.”

in July,” said Lynn Franco, director of

spending in the near-term.”

time customers start thinking and buying vent-free gas log sets and fireplaces. The fall of the 90+ degree temps will help a lot.”

Iowa: (Hearth, BBQ) “More interest in

135.8), following a modest improvement

continue to support healthy consumer

6 Mo. Sept’15 Oct ’15 Nov’15 Ago

1985 = 100

CONSUMER CONFIDENCE The Consumer Confidence Index

Year Ago

Year 6 Mo. June Jul Aug Ago Ago 2018 2018 2018

1985 = 100

new construction are the reasons for growth in monthly and YTD sales.” Michigan: (Patio, BBQ) “Outdoor furniture

was a good time to prepare for winter.”

has been very fickle this year. Woven product demand has diminished in favor of the clean lines of alternative poly or aluminum product. Demand for large and extra-large tables is up, but sales are slow. Many times customers come in wanting something very specific, yet when it comes to the bottom line they don’t want to pay for exactly what they wanted. Mass merchant advertising has skewed the consumer’s sense of value. “Grills were selling well prior to Father’s Day, then dropped off, despite advertising and promotional giveaways from our manufacturers. We feel that the grill sales are definitely affected by an influx of product and sales at mass merchants with sub-standard product. In fact, we have had a rise in customer requests for parts for Box store products, as those products are failing even after a year’s time. Consumer education is the key in getting grill sales back on track.”

Virginia: (Hearth) “August sales were

Missouri: (Hearth, BBQ) “The local

Georgia: (BBQ, Spas) “Slow start to

August, but thanks to a big last 10 days, we finished up.” North Carolina: (Hearth, BBQ) “Sales

again have been amazing. Every month sales are even higher. We have been here for 22 years and it has never been this good. Biggest issue we have is getting new help. Just cannot find quality people. If we could, sales would be even higher.” Oklahoma: (Hearth) “Lots of rain! August

really down until the end of the month. Rain and more rain was taking its toll on new home construction. The last week of August sales started to perk up some. Hope that September will really kick it up a couple of notches, as this is usually the

market is strong in housing, but most of it is for new first-time homeowner housing. The demand for this housing (meaning under $200k) is at levels we have not seen for many years, and the trades cannot keep up. Meanwhile, move up housing is starting

to sit vacant. The increase in affordable housing has brought more competition to the area in regards to fireplace installers as well as many HVAC companies dabbling in the builder side of things for fireplaces. “This trend is dispersing the sales around and allowing contractors to try to drive down the already cutthroat builder unit pricing. We remain profitable due to controlling nearly all of the custom jobs and a handful of contractors who refuse to sacrifice quality, but sales have been hurt. Competition is healthy and free market is great, but I do believe there needs to be more local and national regulation on fireplaces. ‘We put fire into your home’ is a mantra that needs to be taken seriously. I cannot tell you how many homes we have stopped in just to see what the competition is installing, just to see the poor/dangerous

installs that are being performed. (An investigation into this across the nation might make for a good article...).”

Wisconsin: (Hearth, Patio, BBQ) “This

year was the best in 30 years; we’ve never seen so much new construction, homes are getting larger, still can’t find help, no one responds to help wanted ads, but everyone else in a 50-mile radius says the same thing. Gas is out-selling wood and pellet, electric products are holding their own. Lead times are getting longer, back logged two months, historic times. Products are so much better now, even better than the past three to five years.”

Ohio: (Hearth, BBQ) “August sales were

up over last year, but that is misleading, as last year was a personnel disaster in our store. New management and staff are driving sales of products that we lost to competitors last year. Barbecue sales have been flat or down all year – terrible barbecue season for us! “Hearth products have been up steadily as the economy seems to be picking up steam. Hoping for an early start to heating season! We have already started to schedule days dedicated to pre-season maintenance and service calls for heating appliances as nighttime temps dip into the low 60s and high 50s. Bring on the cold weather!”

Wisconsin: (Hearth, Patio, BBQ) “A late

spring followed by an extremely wet summer and we’re still ahead of last season. Some recent large jobs have helped the overall $. Looks like fall will be busy, if it ever stops raining. Flooding is hurting getting to job sites and delaying building.


Standard & Poor’s 500 (a) HNI Corporation (b) Pool Corporation (c) Restoration Hardware (b) Wayfair (b) NOTES:












2,914.04 45.40 150.26 164.49 100.14

2,476.55 31.16 97.25 67.62 35.45

2,840.35 42.68 157.18 134.74 111.64

2,901.52 44.10 164.26 159.00 135.17

2.2% 3.3% 4.5% 18.0% 21.1%

7.8% 17.8% 15.3% 98.1% 68.2%

17.2% 18.7% 63.0% 227.8% 86.5%


$1,880.00 $6,830.00 $2,800.00 $11,960.00

(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

52-WEEK STOCK PRICE CHANGE 240% 220% 200% 180% 160% 140% 120% 100% 80% 60% 40% 20% 0%



86.5% 63.0% 17.2% 18.7%


HNI POOL RH As of 31-Aug-2018


MARKET CAPITALIZATIONS $12,000 $11,000 $10,000 $9,000 $8,000 $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $0

(US $000,000)


POOL 01-Sep-2017




www.hearthandhome.com | OCTOBER 2018 | 85

| Business Climate |

California: (Hearth, Spas) “The economy

“Pellet, wood, oil and LP sales are all up despite a record warm summer in Southeast Alaska. LP had the biggest increase over last year.”

California: (Hearth, Patio, BBQ, Spas)

during times like that... You know the old saying though, when there’s no wind in your sales, it’s time to get out an oar and row! That’s what we are doing now and September is looking good!”

Pray for all the folks that have lost their belongings, homes, and memories.” Wisconsin: (Hearth, BBQ) “A wonderful

increase in sales. Just hope we can keep up. We are still looking for a good younger employee.” Wisconsin: (Patio) “It was the best August

ever. Sales continued to outpace previous years. Hope the trend continues!” WEST

is strong and people are positive, which generates good business. Lots of remodels and more new construction now. Let’s hope it continues for a while. Also, the spa business is showing improvement.” “August was a great month all around. We are booking until November now and people are being patient, as long as it stays warm. Should be another good year. Just a suggestion: It would be great if HPBA had some sort of apprentice program to train installers and service techs. A one-year program to learn the stoves, with different retailers, and to learn different brands. They will not know everything, but they would be a little more useful than someone who knows nothing.” Oregon: (Hearth) “In a booming year,

August was very slow. The weather has been super-hot and it’s easy to get complacent

— Alaska

Washington: (Hearth, Patio, BBQ,

chimney booking orders – couldn’t have guessed that we should have ordered much more. Due to BC’s worst forest fire season, we had too many smoky days and our local soccer tournament had to be put off until late September.” British Columbia: (Hearth, BBQ) “Pretty

normal activity for August.”

British Columbia: (Hearth, Patio, BBQ,

Spas) “August was a down month, not looking like a trend but we will see. Plenty of work booked for the fall.” British Columbia: (Hearth, BBQ)

“This year started a little slower, but quickly started to get stronger. I find customers are planning for the cool weather sooner this year, as sales for hearth products have been quite strong this spring and summer.”

Spas) “We recently started selling patio products. Hearth has been booming throughout the year (YAY!), we brought spas in a year ago in August and have seen a great revenue boost from that. Barbecue is up slightly.”

Ontario: (Hearth) “Hot, hazy, humid.


Ontario: (Hearth, Patio, BBQ) “We had a

British Columbia: (Hearth, BBQ) “Even

though we had an extremely hot August, our hearth customers kept confirming orders and taking deliveries. Chimney sales were steady and we have already sold our

Hardly any store traffic, and impossible to line up annual cleanings etc.”

Ontario: (Hearth, BBQ) “Just a normal


difficult 14-month interruption due to highway improvements at our location. We are located at a very busy highway intersection which included a new bridge. Should only get better now.”

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86 | OCTOBER 2018 | www.hearthandhome.com


WANTED Electric Fireplace Distributor For U.S. West Coast To market our commercial-grade electric fireplaces, sold under the Kennedy brand.


For more information contact sales@jrhome.com or call 1-800-561-5550

www.hearthandhome.com | OCTOBER 2018 | 87

| Classifieds |

Classified Advertising

1 Column x 1 Inch Minimum 1 inch minimum Price per column inch = $175 Call the Sales Department at (800) 258-3772

Business For Sale

Business For Sale

Profitable, Green Energy business on the Central Coast of Calif. Offering residential and commercial applications for fireplaces, stoves, solar electric systems, along with battery based power systems. Three knowledgeable employees, training provided. $55K plus Inventory (apprx. $200K). Cooperative Owner retiring.

For Sale Stove, furniture and gift shop in the mountains of Northern California. Owners retiring. Loyal customer base, working with Air Quality until 2020 on a stove change out. Sales around $900,000 a year. Beautiful area, a great place to raise your children.

E-mail Rick Owens, Broker (No. 01354249) at: bizexpert1@gmail.com or

Subscribe to Hearth & Home online visit www.hearthandhome.com.

Call: 805-543-0506. Website: bizexpert.org.

This ad index is an additional service provided by Hearth & Home to its advertisers. Hearth & Home assumes no liability for any incorrect information.

| Ad Index | Advertiser

Contact us at: quincyhotspot@gmail.com or (530) 283-2929

Page Phone




(888) 997-7623


Blaze King


(509) 522-2730


Broil King


(800) 265-2150

email: gkelly@omcbbq.com

Cajun Grill


(337) 233-6808




(877) 303-3134




(800) 835-4429




(800) 622-1359


Evosus Business Management Software


(360) 735-9510


Hearth, Patio & Barbecue Association


(703) 522-0086


Heat & Glo


(888) 427-3973


IMC – Las Vegas


(702) 599-3046




(800) 421-9455


J&R Home Products Ltd.


(800) 561-5550




(800) 378-3115


Pacific Energy Fireplace Products Ltd.


(888) 223-0088


Peak Season


(866) 606-6330




(866) 919-1881


Sand Hill Wholesale & Mfg.


(888) 726-3445




+491522 26 44 162 www.spartherm-america.com



(336) 227-6211


Telescope Casual Furniture


(518) 642-1100


Tempotest USA


(972) 512-3534


Tjernlund Chimney Products


(800) 255-4208


Valor/Miles Industries


(800) 468-2567


Vesta Awards


(800) 258-3772


Wittus Fire by Design


(914) 764-5679


Wood Carver / Regal Teak


(978) 258-5651


88 | OCTOBER 2018 | www.hearthandhome.com

Who Reads


Dan Bonar, for one! City: Montréal       Province: Québec   Occupation: “Director of Sales & Marketing, ICC Industrial Chimney Company”   Special Interests/Hobbies: “I try to take advantage of the snowy Québec winters by downhill skiing. I used to be an instructor, so I give my daughters (7 and 3 years old) lessons. In the summer I trade my snow skis for water skis and we spend most of our free time lakeside.   “I love to entertain and consider BBQ and cooking an avid pastime. Wine tasting, beer tasting, and scotch tasting are also high on the list – just not all at the same time.”   Problems/Issues Facing the Hearth Industry: “I’m on the Board of Directors of the HPBAC as well as the APC (Québec’s association). Through the Government Affairs Committees it’s obvious we’re still fighting a long-held negative view of our industry from a health and environmental standpoint.  “The HPBA and HPBAC are doing an incredible job of educating those who make decisions, but changing established perceptions isn’t easy. Too many consumers and legislators are uninformed about how incredibly clean-burning and efficient modern hearth products are. “Also, recent tariffs across the U.S. / Canada border have made life difficult for chimney manufacturers in both countries. As steel chimney lengths cross the border, they are subject to 25% tariffs. This has meant increased prices for consumers on both sides of the border.”   Key Trends in the Hearth Industry Today: “Customers want EPA 2020 certified units today, and emissions reduction is becoming the trend. Many of our customers are starting with an emissions goal, and then finding an appliance that suits their objectives. As a company at the forefront of clean-burning technology, it’s a great position to be in.   “Customers also want the biggest, aesthetically-clean glass doors you can put on a fireplace, with the smallest chimney possible.”    Forecast for Your Overall Business in 2019: “We’ve continued to grow our product offerings; this year we expanded into the wood grill and fire pit markets. The 2018–2019 season is shaping up to be strong for pellet appliances. That will bring in sales from a previously slow category in which we have very good market share. With 2018 shaping up to be our biggest year on record, we’re optimistic that will rollover into a very strong 2019.”   Years Reading Hearth & Home: “Fifteen, ever since I first started working as a wood stove/fireplace installer.”   Reasons for Reading Hearth & Home: “Hearth & Home feels like it really has its finger on the industry’s pulse. Reading it gives me insight into my PHOTO: ©2018 RICCARDO CELLERE. WWW.RICCARDOCELLERE.COM. competition, my customers, and the industry as a whole. The industry numbers are helpful in planning, and it’s Click here for a mobile always exciting to see our products on the back cover!” friendly reading experience

| Parting Shot |



ou never know when the neighbors will stop by. This scene of a huge iceberg floating past the Fort Amherst Lighthouse at St. John’s in Newfoundland, likely has been repeating itself for centuries. The oldest confirmed accounts of European contact there date from a thousand years ago, when the Viking Leif Ericson landed.

90 |

Click here for a mobile friendly reading experience OCTOBER 2018 | www.hearthandhome.com

It was first claimed as an English colony in 1583, but that claim was contested for years, first by the Dutch, then by the French, then back to the English when Lt. Col. William Amherst chased the French away. That was around 1762, and Amherst quickly realized that he needed stronger fortifications to protect the harbor entrance; he named it after his brother. The stone fort was not completed until 1777;

Newfoundland’s first lighthouse, a stone tower, was erected inside Fort Amherst in 1813. After Newfoundland became part of Canada in 1949, a new lighthouse was constructed on the South Head. It was 25 ft. tall, wooden, and with a pyramidal design. It wasn’t until 1982 that the lighthouse was de-staffed.


Residential | Contract | Hospitality


1 866 919 1881

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Profile for Hearth & Home

Hearth & Home Magazine - 2018 October Issue  

The voice of the Hearth, Barbecue, and Patio industries. Hearth & Home is a trade journal serving the hearth, barbecue and patio furnishings...

Hearth & Home Magazine - 2018 October Issue  

The voice of the Hearth, Barbecue, and Patio industries. Hearth & Home is a trade journal serving the hearth, barbecue and patio furnishings...