Hot tub industry - careers

[Jacuzzi Jim]

 On a good month I average say 5 to 15 spas a month give or take, at various price ranges. I only get 3% from any spa sale I make, but I also make a really nice salary as I dont do just sales.  
  I do all the purchasing for the spa end,I am also the service manager,handle all the service calls and set up all deliveries for the customers, not to mention anything else that comes along in my spa world.

 What happens though I dont get paid my 3% till the spa is delivered,so I could sell 15 spas in a month, none of which might not get delivered for a month,2 months and even longer so as far as money coming in I am basically collecting money monthly from sales that could be 3 weeks/3 months ago or longer.

  Quite a few spas I sell if in stock, do go out pretty fast. If they are an order in its about 3 1/2 weeks and most people are ready for there spa at that point.

 So is not getting paid till after the delivery the norm in the industry??
Some months I am glad I am paid that nice salary,if not I know I could not live in the house I do and would probably be doing something else.

 Will I stay here? Yes, the company I work for is a major heating and A/C business, and is in the process of building a new store the 2nd one now with patio furniture,bbq"s spa's all kinds of back yard type stuff, along with gas/wood stoves,fireplaces the works.  All in all pretty happy doing what I am doing.

Till I win the lottery that is,I just have to play more.  

[ndabunka]

I have been in this industry over 20 years.  I have many salespeople that work for me.  As far as I know, no salesman in the spa industry makes 3-5k for selling 3-4 tubs. Thats about double of what the good ones make

It looks like someone took my original comments out of context.  I said the GROSS profit was around $3K PER TUB for the DEALERSHIP, not the salesman's cut of the profit.

[ndabunka]

On a good month I average say 5 to 15 spas a month give or take, at various price ranges. I only get 3% from any spa sale I make, but I also make a really nice salary as I dont do just sales.  
  I do all the purchasing for the spa end,I am also the service manager,handle all the service calls and set up all deliveries for the customers, not to mention anything else that comes along in my spa world.

 What happens though I dont get paid my 3% till the spa is delivered,so I could sell 15 spas in a month, none of which might not get delivered for a month,2 months and even longer so as far as money coming in I am basically collecting money monthly from sales that could be 3 weeks/3 months ago or longer.

  Quite a few spas I sell if in stock, do go out pretty fast. If they are an order in its about 3 1/2 weeks and most people are ready for there spa at that point.

 So is not getting paid till after the delivery the norm in the industry??
Some months I am glad I am paid that nice salary,if not I know I could not live in the house I do and would probably be doing something else.

 Will I stay here? Yes, the company I work for is a major heating and A/C business, and is in the process of building a new store the 2nd one now with patio furniture,bbq"s spa's all kinds of back yard type stuff, along with gas/wood stoves,fireplaces the works.  All in all pretty happy doing what I am doing.

Till I win the lottery that is,I just have to play more.  

Sounds like you are a sales manager so the salary seems like a better plan (less risk) than a traditional salesman would have to endure.  I would expect that holding payment until the Spa is delivered would be a pretty common method as it is in other "big ticket" retail industries.  In my prior business I didn't pay the rep until the client paid me.   That simple precaution helped protect me from an unscrupulous sales person that tried to write a bunch of "paper" (orders) right before his departure.  

Three percent of a $8K spa is only $240.00 so it doesn't sound like much but if you average 10/month your still bringing in an extra $2,400/month as "icing on your cake" so it sounds like you are doing pretty well.  

[Micah]

a single salesman selling 3-4 tubs could likely make enough to keep at it ($3 to $5K/month depending on the split with the owner of the business).  

ndabunka,
This is the quote I was refering to.  My statement remains the same.  In our industry selling 3-4 spas will not make a salesman 3-5 k.  If I am "misquoting" you I am sorry.  It does however seem to me like you are saying that a salesman can make at or above $1000 in commission per tub. Average sale is lets say $7500, that means the salesman is getting 13.5% commission.  That is the best paid salesman I have ever heard of in the spa industry.

[D.P. Roberts]

Will I stay here? Yes, the company I work for is a major heating and A/C business, and is in the process of building a new store the 2nd one now with patio furniture,bbq"s spa's all kinds of back yard type stuff, along with gas/wood stoves,fireplaces the works.  All in all pretty happy doing what I am doing.

1) Jim, the company you work for is primarily a heating & A/C contractor? That sounds a little unusual. Most of the companies around here "diversify" into other products such as the patio furniture, fireplaces, etc. like your second store is selling. Pool tables and other "rec room" stuff is also a common combination. In some areas of the country, swimming pool installers also sell tubs.

I'm just curious because it seems like most spa dealers sell other stuff besides spas to support themselves in the "off season". HVAC is a little unusual - are there any other "weird" combinations out there?


2) To generalize:
      A) Owners sometimes pay themselves a salary, but basically live off whatever net profit they may make.
      B) Full-time salespeople earn about 5%-8% commission or a flat $500 or so on their sales.
      C) Employees with other responsibilities earn a salary plus a small commission (like JJ's 3%) if they also make some sales.

Is this a reasonable summary of what one would expect to see at most spa dealers?

[D.P. Roberts]

By the way - I do not sell tubs nor do I own a dealership.  I "had" investigated it pretty deeply a couple of years back.

If I may ask, what made you decide against it?

[ndabunka]

ndabunka,
This is the quote I was referring to.  My statement remains the same.  In our industry selling 3-4 spas will not make a salesman 3-5 k.  If I am "misquoting" you I am sorry.  It does however seem to me like you are saying that a salesman can make at or above $1000 in commission per tub. Average sale is lets say $7500, that means the salesman is getting 13.5% commission.  That is the best paid salesman I have ever heard of in the spa industry.

Micah - Maybe I am the one in error.  I was thinking $1K/tub would equal $3K/month.  Maybe dealers don't pay that much.  I would have, but then again It was just a plan and never actually put into play.  As far as to why I did not "jump in" myself is primarily because my "real job" Voice/Data Convergence consulting is too busy and lucrative to depart (six-figure+ and 40-50 hours/week).  My original intent of the Spa dealership was a business my wife could run while raising a 2-4 year old until we hired a full time manager 2 years down the road.  I would have stayed involved for those first two years (every minute in the dealership I wasn't on the phone for my consulting business) but in the end, my wife decided that she did not want to sell hot tubs.  One aspect may be the fact that she only goes in the tub we do have only about once a year (seriously).

PS - Wife's salary would have been $40 to $50K/year (as owner/operator) as her income from her "previous" job (as a Med Tech) only paid around $32K/year.  Most of the profit during those first 2 years was going back into the store or into a fund to pay for land.  

[East_TX_Spa]

Just throwing my hat in the ring.....

Our business is pretty strange lately.  January and February were great, March and April were not so great.  May started slow but finished strong and June is off to a good start.  We started doing a lot of offsite promotions in May and they helped tremendously.  I truly believe spa companies need to try and do as many off premise events as possible.

Regarding careers in the spa industry:  I don't think spa sales is typically a career path one should pursue if they want to make a lot of money.  I talk to many salespeople at different sales training events and we all compare notes about our jobs.  I wouldn't work under the conditions most of them do.  However, most of them sell swimming pools primarily and the spas are typically somewhat of an afterthought.

I am very, very, very fortunate to be in the position I am in.  I work alone, so no interoffice politics, drama, squabbling over commission....just the occasional inappropriate office romance to deal with.

Being the branch manager, I am responsible for everything that goes on in my territory.  I also receive compensation for everything that comes through my territory.  I get a nice salary plus a single digit percentage commission on everything.

My family's medical insurance is paid by the company, we have a profit-sharing plan, and a bonus structure set up whereby I get a little spiff for every spa I sell over my quota (9 spas) each month.  I also receive a substantial gift around Christmas and get to qualify for company trips (Australia, New Zealand, Greece).

The best part is that I get tremendous support from my boss, co-workers, Watkins Manufacturing, and customers that no one else in this part of the world could possibly get.  I sold 153 spas last year without really doing much more than being personable, being forthright and honest, and selling the very best product in the market.  Once you establish yourself, your business will become self-sustaining if you take care of the customers.  This is where my local competition falls woefully short of the mark.

The customer is GOLDEN.  65% of our business is referrals.  Make them happy and they will make you happy.

Terminator

[D.P. Roberts]

Regarding careers in the spa industry:  I don't think spa sales is typically a career path one should pursue if they want to make a lot of money.  I talk to many salespeople at different sales training events and we all compare notes about our jobs.  I wouldn't work under the conditions most of them do.  However, most of them sell swimming pools primarily and the spas are typically somewhat of an afterthought.
 

Term,

Thanks for the response. This leads me to two questions:

1) What conditions do these salespeople work in? Are these poor conditions more a result of the spa side or the pool side? Here in Ohio, all the spa stores I've seen specialize in spas, as hardly anyone has an inground pool.

2) What, exactly, is the "career path" of a salesperson?  If one's ultimate goal was to own a spa dealership, should one start as a salesperson?

It might help if I explained where I'm at. I started working at a bookstore 8 years ago, with the idea that I would eventually open my own bookstore. I knew I'd have competition from larger chains like Borders and Barnes & Noble, but I knew that big chains like that don't open stores in small towns, where I hoped to open a store. It seemed like a pretty good plan.

Of course, 8 years ago the internet wasn't having the impact on bookstores that it's having now, nor was the internet affecting the use of printed material as a whole. I wouldn't consider opening a bookstore now.

So, I'm thinking of opening a hot tub store. Starting as a salesperson seems like a good idea, as I could learn more about the industry and hopefully save up enough startup capital to open the business. So before I switch careers, I want to hear all the reasons my plan won't work, or any suggestions from people in the industry for a better idea.

[East_TX_Spa]

1) What conditions do these salespeople work in? Are these poor conditions more a result of the spa side or the pool side?

My impression is that most emphasis is placed on selling swimming pools and the accompanying chemicals and accessories as that is where the big money originates.  Salespeople are telling me that they have to split "ups" with 2 or 3 other salespeople, that there is some backbiting and subterfuge amongst them, that they work straight commission and have no benefits nor receive sufficient vacation time.  They carry very little inventory and have few floor models, no mood room, they carry competing brands, etc.

I admit that my job is an absolute dream.  I don't have any of the above situations to contend with, I get 4 weeks paid vacation (which I never take...my job is like an everyday vacation).  I have the best office equipment available, a full beer cooler, a great supporting cast of 3 full-time service techs and a primary and backup delivery crew.  We keep our stores full of spas and have a beautiful warehouse and parts department that we keep stocked.  And I don't have to sell anything but HotSpring, Tiger River, Solana, and HotSpot Spas.  Makes things pretty easy.

2) What, exactly, is the "career path" of a salesperson?  If one's ultimate goal was to own a spa dealership, should one start as a salesperson?

It seems like most of the salespeople I run across are short-timers.  Based upon the way they are treated, I can certainly understand why.  Again, I'm very fortunate to have a boss who wants me to make a lot of money and have job security.  He realizes that I will do everything within my capabilities of making our company successful.  All of our other employees feel the same way.  We're more like a family as opposed to some corporate conglomerate.  The owner of our company is independently wealthy, so we don't sweat the ups and downs of the industry like some others may.  Our company is pretty unique, I would imagine, compared to most.

What I'm saying is that it looks to me like it would be very difficult for someone to try and start up and sustain a spa business in today's climate, especially if they are not fully committed to excellence and have a STRONG financial backing.  It is dang near impossible to sell a crappy brand of spa and have long-term financial success.

Term

[Spiderman]

What I'm saying is that it looks to me like it would be very difficult for someone to try and start up and sustain a spa business in today's climate, especially if they are not fully committed to excellence and have a STRONG financial backing.  It is dang near impossible to sell a crappy brand of spa and have long-term financial success.

Term

Thanks for the encouraging words Chris!  I'm sure pumped now        I'm pretty confident with HotSpring, though.   What's the worst that could happen?  End up working in Shrevport?  

[Spatech_tuo]

It seems like most of the salespeople I run across are short-timers.  

I was speaking to a dealer who was looking for a new sales person and he described them this way. Half are capable salespersons who know how to interact with people and it just so happens that what they sell are spas, the other half are "the Carnies who have teeth". He was looking to avoid the latter.

[D.P. Roberts]

Thanks for the encouraging words Chris!  I'm sure pumped now        I'm pretty confident with HotSpring, though.   What's the worst that could happen?  End up working in Shrevport?  

The industry may be in a little bit of flux now, but I really think it's going to grow over the next few years. From my small amount of research, it seems like a lot of people pay for hot tubs with home equity loans. With all the turmoil in the housing market, it's not surprising that equity loans would be harder to come by.

However, I think the industry is really going to grow long-term. The main reason being that baby boomers are getting older, and more of them will want spas to relieve all those aches and pains. Secondly, with gas prices continuing to rise and no end in sight, it sounds like people are traveling less and spending more on their homes, which should continue to help hot tub sales.

[hotubinn]

Read the thread on "No cover suction" in the other forum.  This is the type of things you will have to deal with...How about replacing a $300 cover (which may or may not fix problem) because their is no "suction" :-?

[East_TX_Spa]

You also get to meet exciting, verbose, intellectually stimulating conversasionalists like this guy:

Me: Come on in and make yourself at home!  I'll be with you in just a minute.
Mr. Excitement:  We're just looking.
Me: Great!  Feel free to look around and I'll be happy to help if you have any questions.
Mr. Excitement:  What do these run?
Me: Well, we've got 27 different models.  They run between $3000 and $12,000.  If you have a few minutes, I'll be happy to show them to you.
Mr. Excitement:  I'm just wanting to know what they cost.
Me:  $3000 to $12,000.
Mr. Excitement:  Well, alright....let us think about it.
Me:  OK.  Take care.