Jerry Greer feared the worst when coronavirus shut down non-essential businesses in March 2020. As the chief executive officer of Core Covers, the world’s largest spa cover manufacturer serving OEMs, distributors and dealers, he worried about how the pandemic might impact not only his company but also the entire spa industry.
“Most national or worldwide crises have not turned out well for the hot tub industry,” he says. “It’s a discretionary purchase, so the industry does not typically grow at those times.”
That didn’t happen this time. As many pool and spa retailers around the U.S. can attest, 2020 turned into a banner year. Stay-at-home orders forced consumers to make their own fun, and they opted to spend money they might otherwise have used for travel and vacations to improve their own residences instead.
“Demand for anything related to the home has gone up substantially,” Greer says. “Fortunately hot tubs were one of those home-related products that have done really well. And, as a result, our company has experienced increased demand.”
When it was safe for its employees to return to work (more on that later), Core Covers added staff, manufacturing square footage and new production lines at its plants in both Mexico and Pennsylvania to keep pace. Greer expects to operate at additional capacity through at least the third quarter of 2021.
Manufacturers and distributors of spa cover lifts and other accessories report unprecedented interest in their products, too. For example, sales of lift devices at Leisure Concepts, a manufacturer in Spokane, Wash., soared by as much as 70% practically overnight, according to company President Mike Genova. “Worldwide demand for cover lifts and spas is at an all-time high right now,” he says.
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Ann Spires, president of Essentials, a Monrovia, Calif.-based supplier of accessories and maintenance products, tells a similar story. “We saw record demand for every spa- and pool-related item we sell — and that’s over 1,000 SKUs,” she says. “The demand for cover lifts and steps didn’t just explode; any instock items were sold out by the middle of May, and we saw increases in every other category, like chemicals, fragrances and novelty items.”
CHALLENGES ABOUNDED
All of that increased demand, though, led to increased stress on companies — especially considering they relied on supply chains that could be interrupted or cut off at any time. Some spa cover and accessories businesses also were temporarily closed because of local lockdowns, putting them further behind the proverbial eight ball when they reopened.
“In January, when news of the outbreak in China first hit, I knew there would be major supply-chain issues,” Spires says. “I was very aggressive with purchasing, knowing that a shortage was coming. In March, when we faced the shutdown, I briefly thought I might have a lot more product than I anticipated needing. Then the leisure industry exploded, and it was all about buyingbuying-buying to try to provide as much as possible.”
For Leisure Concepts, raw materials and plenty of completed product already were onsite when the shutdown happened, in anticipation of a typically busy spring season. But as soon as Genova sensed demand would be higher than usual, he became proactive in working to keep components coming. Although Leisure Concepts wasn’t able to fully meet increased demand, Genova says, “We surprised our dealer base with the fact that we actually had product.”
Essentials dealt with the opposite problem. “We faced extreme difficulty getting product from our suppliers,” Spires says. “Every order we received took multiple shipments outbound to fulfill completely, and every purchase order we placed was received in five to 10 inbound shipments. We combed through thousands of line items of backordered products every week as product arrived, which took enormous amounts of time. The amount of paperwork we processed through our [accounts receivable] and [accounts payable] department was staggering compared to normal.”
Also staggering were the logistics of keeping staff members safe.
“First and foremost, we asked: How are we going to keep employees safe?” says Crystal Lengua, director of sales and marketing for Ultralift Cover Lifter Systems in Ontario, Canada. “Then, obviously, we began wondering if we were going to be able to keep running.”
That second question was answered quickly. Ultralift was deemed an essential business, because its parent company, Specialty Metal Products — which manufactures a variety of metals used by other essential businesses — was allowed to remain operational.
“We were very lucky,” Lengua says, adding that Ultralift’s cover lifters are assembled, built and packaged in the facility it shares with SMP, and metal, paint and packaging are produced in factories all located within a 7-mile radius of the building.
With those basic operational needs met, Ultralift and SMP worked to accommodate staff needs with daily department check-ins led by company officials. They also sourced a 24-hour hotline for employees who might need physical, mental or emotional assistance, and regularly shared wellness information.
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That’s where Lengua’s ongoing education toward earning a certification in Foundations of Applied Mindfulness Meditation from the University of Toronto came in handy. “I really think that providing people with two-minute de-stressing meditations helped their mental health,” she says, adding that she will receive her certificate this March. “We let everyone work from home as much as possible, but that might have made them feel isolated and secluded, which can be hard on mental health. We tried to let employees know that it’s okay to not be okay, and here are tools available to help you.”
Core Covers, which employed 600 people at the Mexico manufacturing facility before shutting down in March for six weeks, implemented rigorous health and safety standards — including the addition of an onsite registered nurse. All employees undergo daily temperature screenings at two checkpoints, Greer says. Anybody with a high temperature or other COVID-19 symptoms is dispatched to a quarantine area, where they are given a rapid test that returns results in about 10 minutes. Employees testing positive for the virus are then driven to a nearby clinic for a full blood test.
Employees also enter an inflatable disinfection tunnel stationed outside the manufacturing facility that sprays them with alcohol-based disinfectant. Additionally, the facility’s layout has been reconfigured to implement social distancing practices, dozens of hand-sanitizing stations have been set up, and sneeze guards separate individuals eating in the onsite cafeteria. Additionally, everyone wears a mask at all times while on the job, and the entire facility is sanitized between shifts.
Core’s 12-member customer service team, meanwhile, still works remotely — a strategy that is paying off in multiple ways, according to Greer. “They like it, and it has improved the quality of life for those who work in that department because they’re not commuting in a high-traffic area,” he says. “Everybody is being productive and completing their workload in an elevated-demand environment. That’s one of the most obvious changes we made during the pandemic that I foresee continuing.”
Amidst concerns about keeping staff members safe, Spires notes that she and the Essentials team also worried about their customers. “[We] always put customer service first and pride ourselves on quick lead times and answering the phones,” she says. “The lead times got away from us, and the calls went through the roof. We felt we were failing our customers in every way, and it took a giant mental toll.”
Not surprisingly, Essentials wasn’t the only company with which customers experienced supply issues, and they expressed understanding. “Our customers [were] telling us that we were doing the best we could,” Spires says.
That kind of outreach during an unprecedented crisis is indicative of the support professionals in the spa cover and accessories business extended to each other in 2020.
“I really saw our industry come together in a way I’ve never seen before, and I’ve been in this industry for almost 17 years,” says Lengua, who also is president of the Pool & Hot Tub Council of Canada. “There were people checking in on each other, there were people sharing information that maybe they wouldn’t have before, and there was a lot of camaraderie — from virtual trade shows to trying to support one another.”
'I FEEL REALLY FORTUNATE'
As 2021 dawns with vaccine distribution underway — although the number of positive coronavirus cases is spiking in some parts of the country again — the future for spa covers and cover-lifting devices has dramatically improved from March 2020.
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“The spa manufacturers are selling 100% of what they can make and have orders through the third quarter. Hot tub accessory sales are just as much in demand,” Spires says. “We still have suppliers playing catch-up from 2020, so the supply chain is still going to see shortages, and we will still have backorders. [But] I’m starting 2021 knowing what I’m up against vs getting run over by a Mack truck in 2020. Our eyes are looking forward, and we know what is in front of us.”
Lengua doesn’t see the upward sales trend slowing down, either. She notes that consumers’ preference to avoid long-distance travel and stay put could linger well into the post-pandemic era. “For the next five years, we’re expecting to still see an incline in people wanting to spend more time at home,” Lengua says.
Regardless of whether the added optimism lasts three quarters or five years, Greer is keenly aware that things could have turned out differently.
“All of us know people who are suffering right now because their industry was hurt by COVID,” he says. “I feel really fortunate that all of us in this business are doing well and that we’re able to provide something consumers want. But we’re also able to take care of our employees, and hence, our employees are able to take care of their families. Although keeping up with demand and keeping people safe with sanitizing tunnels and everything else have been challenges, I know they pale in comparison to those of people who own a restaurant or an events business. So I’m grateful.”
This article first appeared in the February 2021 issue of AQUA Magazine — the top resource for retailers, builders and service pros in the pool and spa industry. Subscriptions to the print magazine are free to all industry professionals. Click here to subscribe.
