The swimming pool industry has faced numerous challenges in the post-pandemic economy, from fluctuating demand to rising material costs. Yet, as Sabeena Hickman, CEO of the Pool & Hot Tub Alliance (PHTA), discussed in her recent interview with Joe Trusty on the Pool Magazine podcast, the industry’s future remains positive. Hickman shared insights from PHTA’s recent Business Operations Survey Report, highlighting key trends shaping the pool sector today and strategies pool professionals can adopt to thrive.
Pool Industry Navigating Post-Pandemic Market Conditions
Hickman noted that while the pandemic initially created a surge in pool construction, the industry is now witnessing a return to pre-pandemic norms. “We are seeing sales begin to normalize,” Hickman explained. “Many people built pools during the pandemic, and now that life is back to normal, customers are turning to service professionals to maintain them. They just don’t have the time to do it themselves.”
This trend has fueled growth in the service sector, which was a standout finding in the 2024 Business Operations Survey Report. According to the survey, pool service businesses have grown as homeowners increasingly delegate pool maintenance tasks to professionals. As Joe Trusty put it, “Service is going to continue—people still need their pools serviced. That’s never going to change.”
The shift toward professional service has also opened new opportunities for builders. Some are adding service arms to their construction companies to maintain customer relationships after completing projects. Hickman remarked, “We’re seeing builders diversify, saying, ‘I built the pool, I know the pool, and I want to be there to service it.’ It’s a smart way to create recurring revenue streams.”
Economic Pressures Impacting Pool Construction
A slowdown in new pool construction projects is being driven by several economic factors, including rising interest rates, inflation, and even political uncertainty. As Hickman noted, “High interest rates are discouraging some homeowners from taking on large projects, like building new pools. Financing options aren’t as appealing as they were during the low-rate environment we saw during the pandemic.”
Inflation has also caused pool prices to rise significantly in recent years. According to the PHTA’s report, the average cost of building a pool has increased from $60,000 to upwards of $90,000. “The rising costs of materials and equipment have pushed prices up,” Hickman explained. “Builders need to carefully evaluate their pricing models to maintain profitability without alienating customers.”
Political uncertainty could also be playing a factor. As Trusty pointed out, “Concerns over the upcoming presidential election could be making some consumers hesitant to commit to large discretionary projects like pools. While the economy isn’t in a recession, as evidenced by recent GDP growth, consumer behavior is shaped by perception. We’re seeing that perception influence some purchasing decisions.”
Navigating Economic Challenges
While the outlook remains optimistic, economic challenges persist. The report highlights concerns over inflation and rising material costs, which are squeezing profit margins. “Many service professionals have kept their pricing steady for customers despite rising costs,” Hickman said. “Our advice to businesses in the pool industry is to evaluate their pricing and adjust as needed to maintain profitability.”
Interest rates and inflation are influencing consumer behavior, with more customers allocating disposable income toward travel and other experiences rather than large backyard projects. Trusty echoed this shift, saying, “We saw two years of lockdown, and people were ready to get out, take that trip, and make up for lost time.”
Despite these factors, Hickman emphasized that the demand for pools is still healthy. “The average pool price is climbing, and homeowners are investing more into creating resort-like backyard experiences,” she said. “While construction slowed slightly, remodeling projects are picking up.”
An Up-Tick in Remodeling Projects
While new pool construction has slowed, remodeling projects are on the rise. “Remodeling is one area where we’ve seen steady growth,” Hickman said. “Customers who built pools years ago are now upgrading their backyard spaces with new features and modern designs.”
The PHTA’s survey also revealed a growing trend among builders to offer more comprehensive services. “Some companies are becoming full-service providers, handling everything from construction to service and retail,” Hickman noted. “This diversification not only helps businesses weather economic changes but also allows them to offer greater value to their customers.”
Trusty added that these shifts align with broader consumer trends. “Many people are looking to refresh their spaces rather than start from scratch,” he explained. “Offering remodeling and service options gives companies a competitive edge in today’s market.”
Pool Industry Optimism Fueled by Research and Data
Hickman encourages pool professionals to explore the PHTA’s Business Operations Survey Report to make informed business decisions in this changing landscape. “The survey allows companies to benchmark their performance against industry averages and regional data,” she explained. “It’s a powerful tool for identifying opportunities for growth and areas for improvement.”
The report, now in its second year, offers detailed insights across multiple industry segments. Pool professionals can use the data to assess everything from gross profit margins to employee productivity. “Participating companies get free access to the data,” Hickman added. “It helps them make smarter decisions and plan strategically for the future.”
Snapshot of Business Operations Survey Data
Demographics
- Participants are primarily located in the southern United States, with a focus on warmer climates.
- Respondents include service technicians, builders and retailers.
- Builders offer the widest range of services, while service technicians primarily focus on maintenance.
Economic Trends
- The industry has faced challenges due to inflation, rising interest rates, and economic uncertainty.
- Despite these challenges, there has been growth in some areas, such as new pool sales and remodels.
- Backlogs for new pool installations have fluctuated but are currently on the rise.
- Customers are becoming more price-conscious and are making adjustments to their purchases, such as opting for smaller pools or fewer add-ons.
Business Performance
- The average company in the study makes around $1 million in annual revenue.
- Builders and retailers tend to have higher average revenues and more employees than service technicians.
- The top challenges facing businesses include economic factors, labor shortages, and access to capital.
Outlook
- The industry is optimistic about future growth as economic conditions improve and interest rates decrease.
- Continued focus on customer satisfaction, employee retention, and operational efficiency will be crucial for success.
Key Takeaways for Businesses:
- Understand your company’s unique position in the industry and identify areas for improvement.
- Monitor economic trends and adjust your business strategies accordingly.
- Prioritize employee satisfaction and retention to maintain a strong workforce.
- Focus on providing excellent customer service and building long-term relationships.
| Category | 2023 |
|---|---|
| New Pools by Type | |
| Gunite | 52.6% |
| Vinyl: Steel Wall | 16.0% |
| Fiberglass | 12.4% |
| Above Ground | 9.1% |
| Vinyl: Concrete or Poured Wall | 4.6% |
| Vinyl: Polymer Wall | 2.9% |
| Other | 2.4% |
| New Pools and Pools/Spas Units Sold | |
| Median Units Sold | 18 |
| Average Units Sold | 67 |
| Revenue per Unit Sold | |
| Median Revenue | $92,262 |
| Average Revenue | $100,109 |
| % of Units Sold Not Completed | |
| Median | 12.8% |
| Average | 19.5% |
| Funding of New Pools and Pools/Spas Projects | |
| Builder Financing | 13.1% |
| Cash | 58.8% |
| Credit Cards | 9.4% |
| HELOC or Mortgage | 12.0% |
| Other | 6.7% |
| Funding of Remodel Jobs | |
| Builder Financing | 4.7% |
| Cash | 70.8% |
| Credit Cards | 15.9% |
| HELOC or Mortgage | 5.1% |
| Other | 3.5% |
The PHTA’s Business Operations Survey reached nearly 500 respondents across various industry segments, including builders, service professionals, remodelers, designers, and retailers. The survey collected detailed data on key performance indicators essential for business optimization. Metrics gathered include profit margins, gross profit margins, company sales volume, and the number of pools built. It also tracked workforce data such as the number of employees and sales per employee, providing insights into operational efficiency. Additionally, the report analyzed revenue per unit sold, comparing trends between new pool construction and remodels. This comprehensive data allows companies to benchmark their performance and identify areas for strategic improvement.
Ready to take a deeper dive?
Listen to our entire discussion with Sabeena Hickman about the status of the industry, current market conditions, and what’s in the 2024 Business Operations Survey Report on the Pool Magazine podcast.
