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Hot Tub Demand Surges During Pandemic Causing Delivery Delays

Updated: Jun 7, 2022

There was a time, not long ago, when consumers had a difficult time understanding how they could enjoy sitting in hot bubbly water outside in the winter. Hot tubs were introduced at home shows where thousands of shoppers were exposed to the products, and consumers struggled to understand how they would fit a hot tub into their bathroom! As time progressed, the notion of installing a hot tub in the backyard became more and more common. In addition, hot tubs became part of hotel and resort offerings worldwide, making the experience well known and sought after by many.

Homeowners of single-family residences throughout Canada, the United States and around the world are now much more aware of the benefits of installing a hot tub in the backyard, which is why a hot tub became one of the most desired new products for the home. On top of the numerous health benefits, a hot tub is part of a healthy lifestyle. It is a great way to spend quality time with friends and family in a setting that fosters communication and being together. It is difficult to operate the all-mighty smartphone in a hot tub, so by nature, it is a way to unplug from social media and all the noise that can be found on the internet.

Hot tub demand and production typically follows the housing market. When the housing market is hot, demand for hot tubs is hot. During the great recession in 2008, housing demand slumped, causing a slump in hot tub demand. There was an overcapacity of hot tub production, and many hot tub manufacturers found themselves restructuring, and some had no choice but to shut their doors forever. Coming out of recession, consumer demand for hot tubs began to gain strength again because it is just one of those rare, natural feel-good products. They are attainable by many, and a hot tub is an excellent health and wellness addition to anyone’s home.

The hot tub and home improvement industries compete for consumers’ disposable income, so there is no surprise that the hot tub industry considers travel and vacation friendly competitors. Consumers spend 10 to 20 thousand dollars on a vacation, which leaves them short for purchasing a new hot tub. Therefore, the hot tub industry began campaigning around the notion of a “staycation.” Essentially the message is for consumers to consider buying a hot tub so they can relax and vacation at home all year long as opposed to purchasing a holiday where the experience is short-lived and the memories fizzle out over time.

So now that we have set the table to this point, there should be no surprise as to what is coming next. In 2019, the housing markets in Canada, the United States, and worldwide were hot, hot, hot. So by nature, the demand for hot tubs was hot, hot, hot. There was no hot tub manufacturing capacity left. Manufacturers were about maxed out. The hot tub business was enjoying boom times as they had never seen before. Now imagine what happens when you put the brakes on travel because of the Covid-19 pandemic! Years of “staycation” marketing resonate through consumers’ minds. The hot tub business no longer has to compete with travel for consumer dollars. The travel industry is flat on its back, and consumer demand for hot tubs is through the roof!

Now we have a hot tub manufacturing under capacity problem. Even inflatable hot tub capacity is a problem! The worldwide output of hot tubs can not keep up with consumer demand, which can not be corrected on the stop of a dime. Hot Tub manufactures are like car manufacturers with a main assembly hall, and various parts and pieces that are sourced from OEM suppliers. If a critical OEM supplier cannot deliver enough hot tub parts, the hot tubs can not be completed in the assembly hall, creating an order backlog and delay. Imagine a jet manufacturers with 200 injection mould machines running at full capacity before the pandemic.

Now demand increases by 100%, but the machines are producing at maximum capacity. The OEM manufacture has important decisions to make. Buy 200 more multimillion-dollar machines to satisfy the current demand, buy a limited number of machines to help meet demand or status quo. They are exercising caution! No matter what the decision, it is challenging because nobody can see what the future holds. It's a catch 22. Invest in equipment that potentially sits idle in the future or leave sales on the table.

If you are in the market for a new 4 person hot tub, you will likely find that your local dealer can sell you a hot tub with a delivery date of 9 to 12 months in the future. The reason is as outlined above. The pandemic has minimized travel and other discretionary spending. Hot tubs were popular before the pandemic, but the pandemic has more than doubled demand. Manufacturers and OEM suppliers are working through the orders as quickly as possible. Capital investment to ramp up production is risky as the market is expected to normalize.

If you would like a new hot tub to enjoy in your backyard, patience is a virtue and beware of dealers that over promise and under deliver to secure your non-refundable deposit. They have no control over the supply chain and are at the mercy of market forces and demand that the hot tub industry has never witnessed before!

Hot Tub Demand Surges Causing Delivery Delays
Hot tub demand surges causing delivery delays. Patience is a virtue and beware of dealers that over promise and under deliver to secure your non-refundable deposit!

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