For the service portion of our State of the Industry issue, we spoke we three of the industry’s leading service professionals to serve as our “service voices.” In these profiles, they share how their businesses fared last year, their strategies for success and their vision for the future. For 2013, we spoke with Bob Nichols, Pete Coccaro, Jr. and Stewart Vernon.
Stewart Vernon Founder and CEO America’s Swimming Pool Company Macon, Ga.
APSP is the country’s largest swimming pool maintenance and repair franchiser. Currently, the company has 110 franchise locations in 12 states.
How’s business these days at ASP?
Well, when you asked me that question last year, we were having our largest classes of incoming pool school attendees. We launched 14 locations last year, which was a record for us.
If you break them down, the highest-performing locations did better last year than any of the high-performing locations from the previous year. Last year’s class of new locations got off to a better start and generated a higher amount of first-year revenue than we’d ever seen in the past.
Some of that was improvement in the response rate to marketing. We’re seeing customers really start to buy in and believe in the variable speed pumps — the energy efficiency and energy savings that new technology in the pool business is able to bring. We’ve really capitalized on this. We’ve seen a record number of variable speed pumps sold last year. And this year, we’ve almost sold more in February of this year than we did in all of last spring.
The new technology is well-branded in the pool business and we’re seeing the results of that. The consumers are responding.
How are the variable speed pumps selling?
We’re seeing these pumps trickling down from the high-end projects to the mid-range, and the reason is that the manufacturers are understanding their technology better and how to market it.
I saw a presentation from a big manufacturer at our owners meeting, it was the second time I’d seen them present, and it was so much better: the message was better-delivered, better information, more data. So I think they’re understanding their own products better, the dealers are understanding the technology better, and the consumer is getting more relevant, better information. And so no longer is it the six-figure new pool that’s getting the variable speed pump, it’s now the $25,000 backyard pool because the dealer is better able to show them off.
One thing that has really helped is the data and the energy savings calculators on the manufacturer websites — the big three all have them — and the consumer can say, “Here’s where I live, here’s how long I run my pump, here’s how much I’m spending, and here’s how much I can save in a year.”
It’s hard to argue with the dollars and cents of it. It’s just common sense. Those selling tools have just gotten a lot better.
We now have a link on each franchisee’s website so the customer can go to that pump savings calculator. They get our direct mail, go straight to the franchisee website and get their own data.
Psychologically, where is the customer now?
Well, it seems like last year we were getting a lot of gloom and doom, whether it was the fiscal cliff or the elections or whatever, and it seems like the customer has worked through some of the fear and unknown that we all felt a year ago. It’s come and gone and the lights didn’t go out.
Whatever result they might have wanted, we now have some clarity, and people are now bearing down and making the most of what they have, and in our world, that’s what they have in their own backyard.
We’ve seen better response to the marketing this year, and I think it’s that the consumer now feels that if they were holding back, they can free up their spending a little bit.
Has monitoring grown at ASP?
Very little. I remember the first time I saw that, it was the summer of 2005, almost eight years ago. And almost every year since then you see an account or two about it, that it’s coming, but I haven’t seen that. I think it’s so difficult to replace what a pool really needs, which is just that visual inspection and the touch and feel of the service professional or homeowner.
I think that will eventually pick up some steam, but I can’t see it ever taking hold the way the hype has suggested.
Are you getting much business from ADA compliance?
The last email before I took this call was from our franchisee to Steve Brown at PoolCorp, our national account manager. He said he’s getting a lot of calls this week from people scrambling to get in compliance.
But before I saw that, I would have said we’ve really not seen the volume of business this spring that we saw last spring. But of course, the legislation came and went, and now it’s back, but in general we haven’t seen a lot so far this year.
How many pools would you say are in compliance? 30 percent? 50? 75?
Just as a gut feeling, I would say it’s on the low end of that. Maybe 50 percent at best. What does that mean? I don’t know. Who’s going to regulate it and when? I have no idea.
And unfortunately, it will probably take some big national lawsuit, and then everyone will scramble to meet the requirement.
Internet retail competition – is that an issue?
We certainly fight it. It is an issue at times. We plan and price based not just on our competition down the street but also on that Internet monster. It’s out there, and I have not seen it get any better. If anything, it’s worse as search engines and platforms grow – like laptops and smartphones – but we combat it at the end of the day with our marketing to drive people into the store and provide them something they cannot possibly get online.
I’ve been proud to see the approaches taken by the manufacturers to protect the dealers. I feel like the big three manufacturers have really stepped up to the plate to back the service professional. Because at the end of the day, once the boardroom doors are shut, I don’t think they care how their pool cleaner is sold.
But if in public they’re showing support for their dealer, that’s all we can ask for. I’ve been proud to see their policies strengthened with better warranties for products that are professionally installed.
And for them it makes total sense. You would rather have your product installed by the service professional. You want that touch of the service professional on the installation of a pump or a backyard slide that a child is going to use.
What’s your biggest concern going forward?
Last year or two years ago, I would have said “fear of the unknown.” So I’ve been glad to see the situation stabilize a bit.
But as far as a challenge for the future, I guess I’d say it’s the challenge of the franchisee dealing with coming business regulation — new regulations on owning and running a business, such as healthcare regulations or payroll taxes. I’m hoping our franchise owners that are successful can continue to be so without too much governmental control. I think that’s going to get worse over the next couple of years.
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