New England Patio & Hearth finds fresh start in established markets
Staff Staff -- Casual Living, March 1, 2009
While it’s true most new businesses fail within the first five years, some start so strong that beating the odds is pretty much a sure bet.
New England Patio & Hearth owners Kurt Wabrek and Jeff Heitmann weren’t exactly novices when they opened their first location in September 2006 in Wethersfield, Conn. Not only did they have more than 50 years of experience in the outdoor furniture industry between them, they had worked together for nearly 15 years at Porch & Patio.
They also knew their market inside and out. So when Porch & Patio filed for bankruptcy in May 2006, launching their own casual furniture business just made sense.
Heitmann and Wabrek looked for a location as close as possible to the defunct Porch & Patio Wethersfield showroom, assuming customers looking for the patio showroom would naturally stop in. That is just what happened after New England Patio & Hearth opened in a 10,000-sq.-ft. showroom just five doors down from the closed store.
“We were able to open a business with a viable product line where the same kind of business had been located for 50 years. It was a natural,” said Heitmann, who is vice president.
“We’ve been very fortunate,” added Wabrek, president. “The day we opened, we had a great day; we just hit the ground running.”
The two opened the second New England Patio & Hearth showroom in April 2008 after learning a competitor was closing shop in Canton, Conn.
“They were selling some of the key players that we sell, and we felt that if we didn’t move into that area it would leave the door open for someone else,” Wabrek said.
The second launch paid off as well, helping New England Patio & Hearth to have a healthy 2008 season.
Given their long history with Porch & Patio, Wabrek and Heitmann didn’t reinvent the wheel in opening New England Patio & Hearth.
“Porch & Patio had a successful recipe for many, many years, so we just took the best parts of that and added to it,” Heitmann said.
The biggest departure from their past employer’s business plan was adding “hearth” to the company name to ensure that customers knew they carried gas logs, custom glass enclosures and other hearth accessories. Other tweaking included adding more outdoor furniture lines to the mix.
“As a startup, we were well received by some vendors, and some took the wait-and-see approach to see how we’d do on our own,” Wabrek said. “Then we got to the point where everybody wanted [to do business with us]. We’ve brought in maybe more lines than we should, but we’ll see what works best for us.”
Their business philosophy is to carry many brands to be able to offer customers what they want, Heitmann said. At the same time, they know they can’t be everything to everybody. “We have a nice mix in our locations so that pretty much anyone coming into our stores knows that this is the place to be,” he said.
Both stores carry the same products, although the larger showroom at Wethersfield accommodates a deeper selection. It is also the location of the company’s 10,000-sq.-ft. warehouse.
Many of their mid- to high-end customers buy for their primary residences as well as their second homes on the Connecticut shoreline or on lakes in the Berkshires, all within an approximately 100-mile radius of the stores ,which are about 23 miles apart. Both locations do a strong special order business, accounting for about 40% of the company’s overall sales.
Like many other specialty retailers, Wabrek and Heitmann can only guess if that and other growth statistics will hold true in the 2009 season.
“With our experience, we like to think we know what we are talking about, but sometimes when a year like this comes along, it throws everything you’ve learned in the past out the window,” Heitmann said.
Looking forward, he said New England Patio & Hearth will be more sensitive to its promotions this season. For instance, in February he put more money into advertising a three-week floor sample sale than he might have in the past. That investment paid off.
“Our numbers this year are ahead of last year’s,” he said.
Still, he and Wabrek are concerned, in part because they bought early to lock in 2008 prices before the talk of recession hit. In general, they would like to see manufacturers base discounts on past performance rather than the current order.
“The programs coming down the pipe from some manufacturers now are more aggressive, but retailers like ourselves had our buying done back in July and August … when all of the commodities were at an all-time high, so all of the product sitting in our warehouse will be paid for at those prices,” Heitmann said. “I think it will change drastically when we go into 2009 buying; everything is going to have to change.”
More in tune
Within its product mix, New England Patio & Hearth is seeing the fastest growth in the high-density polyethelenes and marine grade polymers. Cast aluminum is its largest category, while sling, teak and outdoor wicker all remain strong. The additions and evolutions in the mix result directly from customer feedback.
“I feel like we are more in tune with the customers’ needs and what we and the industry can offer them [than was Porch & Patio],” Heitmann said. “You can definitely see it and feel it on the floor. We are listening more.”
One key to that capability is the retailer’s employees, most of whom worked with Wabrek and Heitmann at the other company. The familiar faces and product, along with excellent service, sometimes leads to brand confusion among consumers even three years later.
“A customer’s cell phone will ring and they’ll tell the caller, 'I’m in Porch & Patio,’ which is fine as long as they make the check payable to us,” Heitmann said.
Still, things are changing, he adds.
“We are making a name for ourselves with every year that goes by,” he said.