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Industrious in Utah

Cailley Hammel
Sss 919 Aq Feat

Utah's motto is a simple one: "Industry." For a perfect example of the expression in practice, look no further than Christian Staples.

Staples, a lifelong Utahn, is the owner of Arctic Spas Utah, a retail and service company in Salt Lake City. His story starts out like those of countless other industry professionals: He got his feet wet (metaphorically speaking) as a lifeguard when he was 17 years old and, upon learning he had a knack for fixing things around the pool, decided to chase it professionally. He was based in Park City at the time, a resort area with an abundance of hot tub repair work — all he had to do was put an ad in the Yellow Pages and watch the work roll in.

Now, more than 30 years later, Staples has developed that one-man business into a multimillion dollar enterprise with 20 people on the payroll and a reputation as one of the best retailers in the industry.

There are countless reasons for that success, all of which could be illustrated by a single principle: Like panning for gold, you have to know what to keep and what to leave behind

"A lot of people try to be everything to everybody, and I've tried to do that, too," he says. "But I've had much better success focusing in on one type of client and one brand of hot tub."

Here, we talk to Staples about picking a hot tub line to carry, the surprising product that has become a bestseller, hiring and more.

The company only sells and services one brand, which allows for a greater level of focus and specialization.The company only sells and services one brand, which allows for a greater level of focus and specialization.

 

COME WIND, COME RAIN

Utah is known for its natural beauty — the state is home to five national parks, including the world-famous Zion National Park, making it a bucket-list destination for those who love the outdoors. But while the views are consistently phenomenal, the weather can be rather temperamental. In summer, temperatures regularly climb over 100 degrees Fahrenheit, and in winter, Utah resorts see hundreds of inches of snowfall. (Brighton Resort, for example, collected a record 514 inches of snow in the 2016-17 season.)

All of this was at the forefront of his mind when Staples first began looking for a hot tub line to carry. It was 1997, a time when the hot tub field was replete with suppliers, but once he met the team at Arctic Spas, he knew he struck gold.

Arctic describes its hot tubs as "engineered for the world's harshest climates" — and given that the company was founded by Canadians who grew up on farms and in rural areas, it's a claim that carries some serious weight.

"We get hotter than a lot of places and we also get colder than a lot of places. In winter, we're sometimes going wading through waist-deep snow to get to the hot tub," Staples says. "I was looking for something that could withstand the elements and also, as a service guy, be easy to service.

Unlike other manufacturers that spray insulating foam from the shell to the cabinet wall, Arctic hot tubs limit foam to the cabinet wall only. This makes the inner-workings of the hot tub significantly easier to access — a big advantage in Staples' book.

"It also makes the spa completely upgradable, so sometimes we'll have customers say, 'Hey, I want you to add a stereo,' or jets or pumps or things like that, and we can do that pretty easily."

Arctic's inner-workings also make the tub more energy efficient.

"All hot tubs have to get rid of the heat that's generated, especially by the motors, in some way, so everyone else puts vents in the cabinet that will vent that heat to the outside. And what we do is utilize that heat to heat the water," Staples says. "We have a hybrid heating system, so we have a heater just like everybody else, but we also draw heat from the equipment and utilize it to heat the water."

He was also impressed by the company's attention to detail, like the addition of a wind lip to help shield bathers from the elements.

"When you sit in the hot tub, wind is very uncomfortable," Staples says. "Arctic Spas have a wind lip, which provides more protection from the wind and allows people to use their hot tubs more often and for longer periods of time."

Staples partnered with Arctic and began retailing their spas at the end of 1998, marketing his business with a slogan similar to theirs.

"We say that we're the only spa built for Utah's harsh climates," he says. "We really reinforce with customers that you want a hot tub that's going to last you for the long-term, not just the short term."

The partnership has been so fruitful that Staples pioneered what would become a convention for the manufacturer.

"I asked them if I could change the name of my company to DBA Arctic Spas, and they said, 'Well, we've never had anybody ask that before, but sure!'" he says. "And now Arctic actually encourages everyone to name their stores Arctic Spas of whatever city they live in."

SWIM SPA SUCCESS

While retail wasn't originally his strong suit, it now accounts for the bulk of Arctic Spas Utah's annual revenue, which amounted to about $7 million last year. His top-selling product may surprise you:

"Our number-one selling model out of any of the hot tubs or swim spas we sell is actually a swim spa, which is unbelievable," he says. "Selling your first one is so hard. It took us almost a year to sell our first one. And once we started selling one, they just seemed to come much easier."

Part of the secret to his success, he says, is personal experience.

"My wife kept bugging me to get a swim spa and I said, 'I've got to get 50 sold first, and then we'll get one.' And so once I had sold 50, which took me awhile to do, I bought one, and I was like man, these are so much fun.

It gets them away from watching TV or playing video games and they can go outside and have fun."

While swim spas come with additional work and cost on the dealer end — they're more expensive to ship and installation requires more logistical planning — Staples says the profit margins are off the charts.

"On a hot tub, we're going to max out at about $18,000. But on a swim spa, if they go with the fancy cover and stuff like that, you're going to be closer to $40,000. And it's exactly the same amount of work for us, so they tend to be a more profitable part of the business."

"When you start using them, you sell what you're excited about. So people come in and maybe they were thinking about getting a hot tub, but they see the big presence of a swim spa and then we start talking about it. And then you say, 'Hey, I have one of these at my house, my kids just love it.

It gets them away from watching TV or playing video games and they can go outside and have fun.'"

While swim spas come with additional work and cost on the dealer end — they're more expensive to ship and installation requires more logistical planning — Staples says the profit margins are off the charts.

"On a hot tub, we're going to max out at about $18,000. But on a swim spa, if they go with the fancy cover and stuff like that, you're going to be closer to $40,000. And it's exactly the same amount of work for us, so they tend to be a more profitable part of the business."

Focusing on the right customers and emphasizing quality over price, Staples says, is a recipe for success.Focusing on the right customers and emphasizing quality over price, Staples says, is a recipe for success.

 

STAFFING SECRETS

Arctic Spas Utah employs 21 people, Staples included. Like most pool and spa dealers, Staples admits finding and retaining staff can be an uphill battle. But over the years, he says his perspective has shifted.

"In the beginning, it felt almost devastating to think about going through the hiring process again. I almost hated it. I actually enjoy it a lot more now. We take more time in hiring people and we do some maybe slightly unconventional things to try to help weed out people who wouldn't fit into our culture."

For example, food is a big piece of the company culture. The company hosts breakfast for the team once a month, and staff regularly enjoys lunches together. As a way of screening potential employees, Staples invites the candidate out for dinner.

"I've had some people say, 'Hey, that makes me uncomfortable, I'm not interested,'" he says. "But we spend a lot of time eating together here. If you're not comfortable eating dinner with us, you're probably not going to fit in."

In a separate conversation, Staples sits down with the candidate for an upfront, honest conversation about what they can expect from working there, including both the ups and downs.

"I pretty much tell them what it's like to work with me and the things you have to put up with. In all honesty, I think I'm a nice person, but I'm not super outwardly friendly to people. And some people don't like that," he says. "One thing we do here is we work. And if you are dragging your feet, it is going to be frustrating not only for me, but also for them. It is just going to create so much stress. So if somebody is not super excited to come in and work, they might need to go back to a job working at the DMV or something more their speed."

It's an idea he modeled after a concept created by Zappos CEO Tony Hsieh. At Zappos, new employees go through a four-week training period before being given what they call "The Offer": If they quit right then and there, they'll get $1,000.

"It's much less costly for them to pay $1,000 than it is to keep them on and realize afterward that they're not invested in the job," Staples says. "I've never offered someone money to quit, but I do essentially try to get them to quit before we hire them."

Filling certain positions can also require some creative ingenuity, for instance accounting roles, which are often filled by aspiring CPAs from nearby colleges.

"I think one of the greatest things I can give them is flexibility, because then they can focus on their school and work here. And the other thing I can give them is real life experience they can take and put on their resume and say they did accounting while they were going to school. And then the thing I get in return are these super smart people who are so excited about accounting."

LIKE ATTRACTS LIKE

Staples brings a principled approach to running a business. He only sells and services Arctic Spas, for one, but he also knows not every person who walks in his store looking for a hot tub is going to be the right customer for him.

"We've realized our best customers are people who put thought and care into their hot tub purchase. They're concerned with how they're constructed, how they last in our climate and how they last in the long-term," he says. "We do have customers that come in and we know we're not a good fit for them because all they really want is a flashy hot tub from Costco.

Focusing on the right customers and emphasizing quality over price, Staples says, is a recipe for success for any hot tub dealer.

"We need to focus in on not just selling on price, because it's super easy to gravitate to that, but it also creates a bad rap for the spa industry. I wish more people would focus on making the shopping experience more high end," he says. "I think all of us would end up making more money in the end if people just had a better feeling about what they were going to get if they bought a hot tub."

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