A Year to Remember
By Bill Sendelback
This past year was one to remember in the hearth industry. Consumers flocked to hearth shops in such numbers that sales of just about every hearth product increased dramatically.
Gas fireplaces were no exception; they continued to be buoyed by recovering new home construction and greater interest in home remodeling. However, even with the last three years of sales gains, after being in the doldrums along with housing starts, the gas fireplace market still has a long way to go to recapture sales levels in new home construction a decade ago.
Most gas fireplace manufacturers report good unit sales for 2014, and they expect continued increases in unit sales this year, although there is cautious optimism as new home construction appears sluggish going into this new year. The good news is that, with an apparent shift away from Builder Box models toward more expensive models with more features, the average sales price of a gas fireplace is increasing.
Although total 2014 unit sales of gas fireplaces in the U.S. rose only 1.5 percent due to sales declines in vent-free models, the total dollar volume increased 3.9 percent, a welcome sign for manufacturers and retailers alike.
“Last year was a very strong year for our gas fireplaces,” says Stephen Schroeter, senior vice president of Sales and Marketing for Napoleon Fireplaces. “Our Canadian sales were up, but sales in the U.S. were way up. We’ve definitely seen tremendous growth in the U.S. Sales in 2015 should be steady with our 2014 numbers, and that is not a bad thing because 2014 was so good.”
“We had a good year in 2014 with sales up in the 20 percent range,” says Paul Miles, director of Sales for Valor Fireplaces/Miles Industries. “Sales in the U.S., particularly in the West, were very good. Canadian sales were good, but not as good as in the U.S. Even though snow in the early part of 2015 in the East slowed installations, the trend is for a very good sales year.”
|LV 50 from Napoleon Fireplaces.|
“Last year was a really good year for all gas products,” says Nick Bauer, president of Empire Comfort Systems. “Even with housing starts down somewhat at the beginning of 2015, this year saw a nice start compared to early 2014.”
Sales of gas fireplaces have increased for the last three years in the U.S. after falling, in 2011, to the lowest unit sales level in at least 15 years – 273,893 units. Even after increasing 44 percent to 394,952 units in 2014, that number was still down 64 percent from the high in 2005 – 1,086,915 units.
In comparison, wood-burning fireplaces in the U.S. dropped 75 percent from a 2005 high of 426,884 units to 105,017 in 2014. As a result of increased market share garnered by gas fireplaces over the years, in 2005 gas fireplaces accounted for 72 percent of the fireplace market, with wood models at 28 percent. By 2014, gas fireplaces had nabbed 79 percent of the market, with wood models now at 21 percent.
Direct-vent gas fireplaces continue to dominate the market, holding steady at 79 percent of the market. Despite dropping 12 percent in unit sales for 2014, vent-free models nabbed 16 percent of the market, and B-vent gas fireplaces accounted for five percent. Even with a 12 percent drop in unit sales in 2014, manufacturers expressed confidence in the vent-free category, with some just entering the vent-free arena.
“We’re confident in the category,” says Jess Baldwin, senior vice president of Sales and Customer Service for Vermont Castings Group, “and we’re committing substantial resources to vent-free.”
“For us, vent-free has outpaced our vented sales,” says Empire Comfort’s Nick Bauer.
“Our vent-free sales are staying stable and constant,” adds Glenn Thomson, executive vice president of Sales and Marketing for Innovative Hearth Products (IHP).
Most gas fireplace manufacturers continue to add contemporary models to their lines, but traditional styling still dominates. Traditional models were 79 percent of the gas fireplace, stove and insert market in 2012 in the U.S. and Canada, and actually increased that market share to 89 percent in 2013. But traditional styling declined to 81 percent of 2014 unit sales, with contemporary styling at 19 percent.
An indication of the higher prices of most contemporary models, they represented 21 percent of the 2014 dollar volume while traditional models brought in 79 percent.
A new word has been coined to describe today’s new styling – transitional, styling between traditional and contemporary. Featuring louver-less, clean-faced fronts, transitional appears cleaner and simpler than traditional without the ultra modern lines and glass ember beds of most contemporary models. Transitional styling appears to be gaining favor with consumers and retailers, and therefore manufacturers.
“Transitional styling is gaining momentum,” says Perry Ranes, director of Sales for Travis Industries. “Dealers are pushing us harder to put logs in our linear models to make them more transitional. But the majority of our sales are traditional. The Canadian and Australian markets are huge for contemporary, but people in the U.S. want logs.”
“The demand for clean-faced models has escalated significantly,” according to Vermont Castings’ Jess Baldwin. “Linear styling continues to gain a bigger share of the overall direct-vent market, causing the average sales price to move up.”
“Millennials are looking for non-traditional styling, but not necessarily contemporary,” says IHP’s Glenn Thomson.
|Model 4237 by Fireplace Xtrordinair from Travis Industries.|
“Contemporary styling is growing and becoming more and more important, along with a shift away from logs,” says Patrick Moynihan, president of Sólas and a longtime industry manufacturer. “It has long been popular in Canada, and in the last few years the U.S. has embraced it. But the U.S. is still a few years behind Canada.”
Sólas has been manufacturing contract OEM fireplaces since 1999 but developed its own line in 2007; the company specializes in high-efficiency, contemporary, wall-mounted, direct-vent gas models. “Our retailers are now pushing us for outdoor wall mounts and indoor built-ins,” says Moynihan.
“Sales of linear models are strong, and customers are looking for feature and design options,” says Napoleon’s Schroeter, “but traditional with logs still rules. The whole industry has done a great job of moving traditional styling forward with the no-louver, clean-faced look.”
“We’re continuing to focus on modern design in gas fireplaces, though we consider it less of a trend and more of a fixture,” says Bob Ballard, senior vice president of Marketing for Hearth & Home Technologies (HHT). “We’re continuing to satisfy consumer demand by developing new, modern, linear products.
“Outdoor fireplaces are another key area. Consumers are continuing to look for ways to enhance their outdoor living space with outdoor fireplaces.”
However, there are some who think the industry may have gone too far with the wide variety of features offered in today’s gas fireplaces.
“Manufacturers are trying to push more features than consumers really want, similar to what they are doing with today’s cars,” points out Empire Comfort Systems’ Bauer. “Consumers are not driving the demand for more features. The main consumer phone calls we get are from people wanting to know how to use their remote control. So although we offer features as options, we try to keep things simple.”
As of Jan. 1, 2015, all gas hearth appliances must have a safety barrier for the glass front if the temperature of that glass can exceed 172 degrees F. It has not been an easy addition for some manufacturers to become compliant with a barrier that blends well with the appliance design and remains attractive.
“It was tough to do,” says Napoleon’s Schroeter. “We didn’t just want to bolt it on the front and have it look ugly. It has to meet our criteria for quality and appearance. In some cases we had to redesign or create new models. On some models it was easy, but for some it was very complex.”
“We introduced some products with barriers in 2014,” says IHP’s Glenn Thomson. “We had to redesign our whole product line in just a few months to have barriers that were acceptable to us and to consumers.”
|Forty6 by Sólas.|
“These barriers were a ton of problems for us,” says Empire Comfort’s Bauer. “Some applications came out good, some not. We have barriers, but we’re not totally happy with them. It will take us a year or so to get them acceptable to us.”
Most gas fireplace manufacturers are offering new models for 2015, and here are just a few:
Empire Comfort Systems this summer is adding four new gas fireplace models: a 60-in. vented indoor linear model in its Boulevard series, a 60-in. outdoor model in its Carol Rose Collection, a two-sided or three-sided vented indoor model yet to be named, and a vent-free Slimline model for installation in 2-by-4 or 2-by-6 walls or wall hung.
Hearth & Home Technologies is introducing its Heat & Glo Primo model, a very clean-faced, direct-vent unit with “no restrictions on finishing materials” and no exposed barrier mesh or trim, featuring HHT’s Power Flow Heat Management System. Another new model, the Palazzo, is an outdoor linear model featuring a remote-controlled barrier screen.
Innovative Hearth Products this fall will introduce its Aries, Gemini and Scorpio, good-better-best series of heater-rated models. Designed for new construction, all three will be available in four sizes with either traditional or contemporary styling.
Kingsman Fireplaces is expanding its gas fireplace offering into vent-free models with clean-faced styling and remote controls that can be accessed from a smart phone.
Mendota Hearth Products is introducing three new gas fireplaces. Its ML 39 is a smaller linear model with Driftwood or Forest Oak logs and a porcelain reflective liner. The Fullview FV 34 is more traditional with a wider styling, and available with custom fronts. The FV 41 Arch features a traditional arch front and an 80 percent turndown.
Napoleon Fireplaces has introduced its new HDX series of gas fireplaces, premium clean-faced models in 35-, 40- and 52-in. sizes, with optional fronts. The HDX series also features Napoleon’s Big Flame burners that concentrate the flames, giving a “towering,” very natural effect. The LV 50 is a new 50-in. linear model coming this summer, with LED lighting under the glass media. Operated by an app with a tablet or smart phone, the colors and intensity can be controlled, offering 14.2 million color and intensity combinations.
Travis Industries this summer will introduce its FPX 4415 Linear See-Through featuring a variety of front finishes including new hand-hammered trim. Available later this summer, the FPX 4237 is a new clean-faced, transitional 60,000 Btu model featuring a 13-piece log set. Not a linear model, the FPX 4237 is taller than it is wide.
An Iron Works face with double doors is now available with compliant barriers for the 564 and 864 gas fireplaces and the DVL gas insert. Also available for these models is a new Timberline front, custom hand-forged and hand-hammered.
Travis’ new Da Vinci brand, a 2014 Vesta Award winner, now features the custom L Series available in single-sided, see-through, island, pier, left corner, right corner and bay configurations. In three-ft. to six-ft. sections, the L Series, a 2015 Vesta Award finalist, is available in three-ft. to 21-ft. widths with glass heights from 12- to 36-in. Travis is developing a heat exchanger for the L Series.
Valor Fireplaces/Miles Industries this summer will introduce the H6 transitional model into its Horizon Series, a larger, clean-faced fireplace with 60 percent larger viewing area than Valor’s H5 model. The H6 features four firebeds. Valor’s new L3 linear model is a larger continuation of its linear L1 and L2 series. The L3 will be available in July.
Vermont Castings Group is introducing new linear see-through, vent-free models into its Slimline and Premium series. After redesigning its builder line in 2014, Vermont Castings is re-engineering its mid-priced lines for introduction in August, 2015.
Big $$$ in Expensive Fireplaces