The State of The Industry: Builders Moving Forward

Eric Herman Headshot
photo of a construction site
Courtesy Roger Willis

The swimming pool and spa construction industry made significant gains in 2011, which by all accounts are continuing in 2012. The AQUA builders survey found 59.2 percent of pool building companies reporting better revenues and 47.3 percent reporting an increase in the number of projects, all marginal improvements over last year's survey.

In my discussions with builders, it's clear that things are finally getting better, even though most remain reluctant to declare a definitive end to the doldrums we saw during the depths of the recession. The phrase "cautiously optimistic" seems to have become a mantra of sorts; as if no one wants to jinx the recovery by declaring its existence prematurely.

Such caution would seem wise, given that the general economic recovery so far has been at best "shallow" with unemployment remaining high, energy costs cutting into discretionary income for the both homeowners and businesses and the continued problem with lenders who have remained in a defensive crouch ever since the crash.

The reason for the significant uptick in pool construction appears to be due to a handful of key factors. In addition to improving economic conditions, the past year has seen some of the warmest weather on record. As my friend Mike Farley points out in the Q&A which follows, the Dallas/Fort Worth area experienced 75 consecutive days last summer of weather in excess of 100 degrees followed by an extremely mild winter. Similarly warm temps from around the U.S. have motivated homeowners to revisit their dream of pool ownership.

This year's survey revealed another dimension to the recovery that's worth noting. In responses to the question about factors that have influenced the market a number of builders focused on advances in technology that have made a significant difference including variable-speed pumps, improvements in user-friendly automation, increased flexibility in vinyl liner design, the advent of LED lighting systems, greater selections of materials options such as glass tile and surface options, and overall improvements in energy efficiency.

Also contributing on the plus side, many cited the trend toward providing entire backyard environments including outdoor cooking areas, gazebos, outbuildings and integrated planting and hardscape designs — a trend that fits neatly with the aging Baby Boomers desire for greater luxury and comforts at home.

On the downside, many builders are quick to point out the dampening effect of confusion over the implementation of federal regulations, including the vacillating VGB rulings, last fall's drain cover recall and more recently the stuttering enforcement of ADA requirements.

Finally, a recurring theme that didn't show up in the survey, but has certainly occupied much of my time in conversations, is the influx of landscape architects into the pool business. Some view this migration as a threat to the rank and file pool and spa industry, while others view it, as I do, as a natural evolution that is leading everyone involved in aquatic design and construction in a more professional direction.

I believe this development will ultimately be good for the industry as it provides opportunities for those builders who are willing to expand their skill sets and acumen through continued education, while at the same time pushing fly-by-night companies further toward the fringes. After all, as is true of most any profession, to succeed over the long haul is to constantly evolve.

In summary, from my particular vantage point covering the aquatics design and construction industry, I see genuine cause for optimism, but for at least the time being, that optimism should be moderated with a large dash of caution. Compared to the brutal contractions of the past few years, that's pretty darn good!

Comments or thoughts on this article? Please e-mail [email protected].


Builders were asked what types of projects they took on in 2011. Remodel work led the way with more than 70 percent, up about 3 percentage points from 2010; 40 percent are involved in vinyl liner projects. Inground concrete vessels held steady at 53 percent. Firms involved in commercial construction increased from 18 percent in 2010 to 27 percent last year.

graph showing types of construction completed in 2011


Net hiring was up in 2011, as 24 percent of builders reported new hiring while 20 percent were cutting workers. More than half reported no change either way, indicating that a majority of firms have the right-sized staff.

chart showing number of full-time, year-round employees in 2011

chart showing number of additional employees hired during the season in 2010


Notably, the number of firms adding new types of projects increased from 18 percent in 2010 to 27 percent last year.

Builders reported adding a number of new features to their projects including splash pads, landscaping, vinyl liner repair, electronic leak detection, heat pump installation, resurfacing, solar heating, geothermal heating, energy audits, out-building construction, paver installation and pool service, among others.

graph showing services added in 2011

"We added ADA pool lifts and commercial renovations."

"Automatic pool cover repair and installation"

"Outdoor kitchens"


Just under half of respondents said they increased the number of projects last year from 2010. That encouraging number was offset by the 34 percent who indicated that they did fewer projects, with the remaining 18 percent staying the same.

Comments from respondents reflected 2011's mixed results:

"New construction was down but vinyl liner replacements went up."

"A number of projects are on hold due to the economy."

"We're down 90 percent from 2006."

"Just about a 10 percent increase from 2010."

"We were up 65 percent."

graph showing if the company did more or fewer projects in 2011 compared to 2012


The distribution of gross revenues remained steady with a fairly even distribution of companies generating revenues across the spectrum, with 60 percent earning between $100,00 and $750,000. Five percent reported earning more than $5 million.

graph showing gross revenue for construction, installation, and renovation in 2011


A strong majority, 59 percent, reported that revenues were up from 2010, with 41 percent reporting a decline. Those mostly positive, but still mixed results are consistent with the results of the previous question regarding numbers of projects.

chart showing 2010 vs. 2011 gross revenue in pool and spa building industry


The survey indicated a clear decline in the attrition rate of pool builders. Back in 2009, a stunning 47 percent reported a fewer competitors. That number fell to 40 percent in 2010 and continued its steady decline in 2011, down to 29 percent. The number of those gaining competitors remained steady at 20 percent.

"Garage pool builders kill us underbidding because they have no overhead, and more and more are showing up to compete."

"Most competitors can't compete with us. One of our wisest customers once said, 'The only competition is in your own mind'."

chart showing if builders lost or gained competitors in their area in 2011

"We feed off the marketing of our larger competitors."

The question whether or not competition was a major factor in their company's performance in 2011 drew some of the most interesting and varied comments from respondents:

"I believe it all depends on your attitude with the customer when you arrive to price a job. If you're nice to a customer and provide a good service, the competition really does not matter for the most part."

"Many are unaware that minimum standards even exist, and too many inspectors are still on a learning curve when inspecting inground pools for compliance."

"Cut into margins — anyone with a pick-up truck or a minivan is now in the pool business."

"A lot of companies went under in the recession (mostly companies with high overhead) and also unprofessional ones that walked away with homeowners' money and uncompleted projects. In saying this, we have survived the economy (not out of the woods yet) due to the referrals we receive from our past customers."


"A wider understanding that better efficiency and safety are not our enemies."

"All of the different types of water features and add-on equipment that can be installed on swimming pools to make them look like an expensive piece of artwork."

"The economy, stupid!"

"The lack of consumer confidence."

"The move toward greater state regulation, implementation of Virginia Graeme Baker and new ADA access rules for public pools."

"The legal mandate to install variable speed pumps."

"We got rid of a lot of deceitful contractors and made homeowners do more research before calling a contractor for a proposal. It also created another potential problem, that is that some contractors are offering services that they are not competent in and therefore, bidding low, very low, on items that they don't normally do and leaving dissatisfied customers."

"A commitment to a pool that can deliver a ROI... Less energy, less chemicals, less waste, less maintenance and less work... People buy pools to enjoy them, not be sorry they ever bought one..."

"Decorative concrete is by far the newest and most exciting area for my customers and me."

"Easy-to-use automation."

"Saltwater chlorine generation."

"Last year's main-drain recall; what a tough time it was to get answers and try to understand what the issue was."

"Bringing old-world qualities to the new world of technologies."

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