In a significant shift in business strategy, LPI announced it is ending its domestic dealership program to focus on its direct-to-consumer retail division, Aqua Living Factory Outlets. The move, effective Jan. 1, 2019, will impact about 200 spa retailers who carry LPI portable spas, which includes the Catalina, Signature and Pinnacle brands. Aqua Living currently operates 35 stores, with 110 more expected to open over the next two years.
LPI CEO Dave Hatley says the change is the result of the company reaching an impasse where it is no longer feasible for the Johnson City, Tenn., facility to meet the production needs of a dealer network and its own retail stores.
“We've been playing on both sides of the fence for four or five years now. We have retail stores that we own, and we have dealers in the same markets, meaning we're somewhat competing against our dealers,” Hatley says. “This year the dealer orders were substantially more than we projected, and we ran out of capacity. With the strength of our retail stores doing so well over the last couple years, and the improving economic conditions, we felt like we needed to choose this direction and put all of our efforts into going into the retail world.”
LPI’s second manufacturing plant in St. Petersburg, Fla., has not reached its production ceiling, meaning dealers who carry LPI swim spas will be unaffected.
“The decision to end our domestic dealer programs was an extremely tough one. Ultimately, we see our most successful path in the USA through providing our products direct to the consumer,” Hatley says. “We plan to work diligently with all our current dealers in transitioning them to another manufacturer.”
