Founded in 1966 by Steve Ast's uncle, Bob Ast, Shasta Pools has grown to become Arizona's largest swimming pool builder. Shasta has brought the fun and enjoyment of swimming pool ownership to more than 75,000 families.
It appears the economy is very gradually improving. Did you experience any growth from 2009 to 2010?
We went up a little over 5 percent in that time. So it wasn't cascading down sales like it once was, but you could see the market moving slightly up, so that was a good sign. I think one big barometer is consumer confidence, and throughout the last six months of 2010, it seemed like it was steadily trending upward. And when people feel confident about the next six months to two years, they go buy more big-ticket products, things that increase their quality of life.
Any other positive trends helping the pool and spa industry?
In Arizona, there are a lot of people moving here from colder weather states to escape the cold, and when they come down, pools seem to be at the top of their list. I've seen more of that in the last six months than I had seen in a long time, and that's due to a combination of things. Right now, you're getting such a great value from homes in Arizona, values you haven't seen in the past 15 to 18 years. And then, of course, some people have dreamed about owning a home in Arizona, so they're saying it's perfect timing and a lot of people are taking advantage of it.
Are there any other factors affecting the health of the pool and spa industry in Ariona?
The real challenge in Arizona is because of the foreclosure crisis, we're not seeing a whole lot of new home building, and typically, the pool market in Arizona really follows behind new home building. In a typical year in Maricopa County, they'll build 30,000 new homes, but in the last couple years, it has been between 7,000 and 10,000. So every year that new home building doesn't take off, you're trying to chip away and gain market share from a smaller pie.
What percentage of pools do you build on new homes vs. existing homes?
In a typical market, it's about 50/50, but the last couple years, it has been more like 90/10 existing homes vs. new homes.
Have you been doing a lot of renovations over the last few years, as well?
We've been in remodeling for almost 25 years. So for a long time, it has been a good part of our market. What we've seen is a lot of builders get in and get out because remodeling pools is a vastly different set of parameters vs. building new pools.
Has your clients' ability to find financing affected your business?
This is a huge issue. There hasn't really been any equity financing available recently because of the drop in home values in Arizona and many other states. That's going to be a slow grind to the point where equity financing comes back, but really there's literally zero lenders that are offering equity financing right now. They might want you to remortgage your entire home or do a complete refinance, but aside from that, most of our customers deal with unsecured financing. They're finding ways to get a portion unsecured and pay down a portion. You've seen some creative ways to finance for people that really want a pool, but if we had any type of good financing, you could probably double the business in Arizona.
I hate to say it, but probably 70 to 80 percent of business is cash right now, and that's why the pool industry in many parts of the country is not going to take a jump up until there's some type of good financing available.
How do you believe the Internet has influenced the building segment of the industry?
I think for the most part, it has been very, very good. Most consumers like to do their own research anyway, and it allows consumers to do that research at very little to no cost, conveniently and in their homes. It used to be, prior to the Internet, when customers came in to your store, they'd have tons of questions, like how long have you been in business? What is your rating with BBB? Now, you don't hear those questions being asked because they've found all those answers already online. They come in ready to look at your products. I think it sets their minds at ease a bit more.
Secondly, it allows consumers to select between a few contractors, and businesses have been able to lower their overhead and provide a lead-generating source they didn't have in the past.
