Frenzied demand, record sales, interrupted supply chains and sparse inventories: a quick picture of the pool and spa sector's wild ride through 2020. We've witnessed the historic surge in consumer appeal of pools and spas, but what about saunas?
Actually, interest in the product was on the rise well before the pandemic hit, thanks to growing interest in the well-documented health benefits of saunas.
A breakthrough study in 2018 from the University of Eastern Finland cemented the association between sauna bathing and better health – specifically, reduction in the risk of vascular diseases, neurocognitive diseases, skin diseases, arthritis, mental health disorders and more. As the wellness movement gains steam, year after year, research like this convinces more consumers of the value of wellness products.
Against this solidifying backdrop, the COVID nesting effect of 2020 drove sales through the roof.
"There was definitely huge demand with everyone being at home, then of course with spas and health clubs being closed," said Logan Ross and Kim Temme of Nordic Saunas in a conference call with AQUA. "All those people that normally go to the sauna on a regular basis weren't able to do that."
Just as we saw with the pool and spa sector, meeting this demand was a struggle due to the supply issues provoked by the coronavirus.
"COVID had a significant impact on our business," says Les Hyatt of Dundalk LeisureCraft. "We were shut down for several weeks, so we weren't able to ship orders. After opening up, our demand increased significantly, similar to the hot tub industry. Our lead times went from our normal 4-6 weeks to 12-15 weeks, and in some cases, even longer."
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"[This was] the highest delay we'd ever seen going from spring into summer, because the sauna is sort of seasonal. Normally we wouldn't see delays and demand for saunas spiking upwards going into the summer," says Ross. "Normally, everything kind of teeters down, and then we anticipate that spiking-up, especially in the northern states, once it starts getting colder. Watching demand, you can tell which states are getting colder by where the leads are coming in. So we've never seen it like that in March and April."
As this demand was spiking, supply chains for models made across the Pacific suffered link breaks and significant delays.
"On the China side, we definitely saw a couple months basically shut off completely," says Mark Raisanen, national sales manager, Finnleo. "Our portable and plug-and-play type units — meaning infrared portable saunas and portable traditional Finnish saunas — the ones that are made in our factory overseas in Asia, they're major backlogged, around six months. And that's with double production of what we were doing last winter."
Although they still felt reverberations, supply chains outside China were less affected. Finnleo had relatively normal lead times for their U.S.-built custom rooms, and no problems sourcing goods produced in their Finland and Sweden factories. As for Nordic, Temme and Ross noted the same for their main focus, European-built and California-built saunas.
STRAINS ON SUPPLY
At Dundalk, supply chain problems took several forms. "When we first opened up, not all of our production lines could be manned, and that created shipping shortages," Hyatt says. "Because of the significant increase in our business along with an increase in other sauna manufacturers' sales, some wood types became scarce and difficult to get. More recently, we're experiencing delays from our glass suppliers for the glass in our doors and windows."
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Complicating the wood shortage is a tariff affecting the Canadian Hemlock and Western Red Cedar commonly used to craft saunas. "[The tariff] has been in effect for the last three years or so. After they came to an agreement, that tariff went off at the end of July," says Temme. "[Before that], basically, no one wanted to buy cedar and bring it in. Everyone wanted to just use up their sources that they had stateside before they brought any more across the border. But come August, there was huge demand, which actually made the cedar price go up higher because now there was this huge pent-up demand for the clear cedars used for saunas."
RETHINKING HEALTH CLUB NORMS
Like other residential leisure products, sauna sales overlap into public facilities and are affected by that market. And in this brave new COVID-conscious world, public facilities are being forced to re-evaluate the way they incorporate saunas.
"[This] has absolutely changed the world's practices in how to recreate, how to sweat, and how to work out in gyms," says Ross. "It's going to continue to change for years to come in regards to what you can do in gyms and spas. I think it's going to become more European-style in the U.S."
With health and wellness facilities subject to state and local regulations for hygiene and safety, some are beginning to invest more into single-user sauna models.
"We have a few places that are installing single units — just one and two-person type saunas, side-by-side, for commercial use," says Ross. "There are a few places providing that, so users can go in one at a time."
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Innovative and novel as this tactic may be, the number of facilities taking this approach isn't large enough to have a significant effect at this point in time. "It's just those facilities that are wellcapitalized that can make improvements during the slowdown," says Raisanen.
MAKING HEADWAY AT HOME
Saunas are seeing the highest growth potential in homeowner purchases, in a continuation of the trend to bring outside entertainment into the home. And at Nordic, there's a certain model outselling the rest, according to Ross. "The Finnish-style sauna has seen the biggest demand," he says. "And those are the type that you normally find at the gyms and at the spas."
While traditional Finnish-style saunas are popular now, the infrared category is seeing some growth as well.
"Infrared is growing because it's a category that is a little bit cheaper to get into; it's a little more affordable-friendly. You can set it up, take it down, plug it in anywhere," says Raisanen. "It's the ease of it. And the other thing is, people who may have found the Finnish sauna to be too hot... seem to gravitate towards infrared as well, because of the low temperatures. You still get health benefits at a low temperature."
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According to Raisanen, Finnleo is also seeing growth in a product that provides the best of both worlds.
"We've had a lot of growth on this combination — it's what we call a hybrid, two-in-one sauna," he says. "It's infrared and traditional in the same room. You don't have to own both, you just own one, and you select what bathing style you want that day. We're selling these to people who can't decide what to get, and in the end ended up getting both.
Having said that, Raisanen adds, "Our dealers that are having the most success on closing sales right now have the ability to handle custom. The nice thing with custom is that the lead time is relatively short — three weeks — and they also have very little competition. You can't go online and find a custom sauna at Costco. It's exclusive, and most customers are surprised to learn that it's not that expensive. You can put in a custom sauna in your home at a reasonable price."
