August 1, 2015
For Immediate Release
Hot tub finance sales up 63%
Sales of hot tubs on finance have risen by more than 63 per cent on the same period last year. Consumer Credit Solutions (CCS) have reported finance approvals were up from £1.4m in May 2014 to £2.2m in May 2015.
Higher sales on finance are an excellent indicator of what is happening in the wider pool and spa market. Consumer confidence has clearly increased over the last 12 months, with homeowners willing to make ‘big ticket’ purchases on luxury goods.
Record sales figures are being experienced by both online and showroom dealers across the UK, with some reporting sales up by 30 per cent. And it’s not just new customers buying their first hot tub, many long-term owners are also trading in and upgrading. Sales have also been fuelled by the fact there are some very competitive hot tub finance products available at the moment that are attractive to both dealers and consumers.
Paul Farrell, Marketing Manager at Jacuzzi Spa and Bath Ltd, said: “Jacuzzi has seen continued double digit growth into 2015, with hot tubs now seen as one of the must have luxuries for the home.
“To quote one of our largest customers, ‘we believe that consumers are now tired of not spending money under the pressures of the recession, and credit offers that flexibility without putting personal savings at risk’.”
Online retailers have experienced a similar rise in sales, with finance contributing to their growth. Scott Jackson, Managing Director of The Grizzly Bear Hot Tub Company, said: “We have seen a large and steady increase in our hot tub sales since 2013. Finance has played a part in that. Interest free credit has been a huge draw for customers as it has made hot tubs more affordable to a much wider market. Customer feedback indicates that people are more willing to spread the costs rather than having a large initial outlay.”
Offering finance has become a key ‘soft sell’ marketing tool for hot tub dealers
CCS Managing Partner Andy Wallace believes finance is a valuable sales and marketing tool and it has helped many businesses to significantly increase turnover and grow. Andy said: “Finance is often associated with purchasing cars, furniture or funding home improvement activities such as double-glazing or kitchens but it’s become widely available on many luxury items including hot tubs, spas and pools.
“Today’s customers now expect businesses to offer an attractive hot tub finance option as standard, whether it’s interest free, buy now-pay later or a low interest bearing loan. Dealers are undoubtedly losing sales if they don’t offer credit.”
Since April 2014 any business wanting to offer finance to customers has to be authorised by the Financial Conduct Authority (FCA). Becoming authorised can seem like a big step and some retailers are put off because they think the application process will be complicated and expensive.
However, for hot tub dealers, becoming authorised by the FCA is relatively simple, this is because they sell ‘on-trade’ from showrooms or via the internet, which means a business only needs to apply for Limited Permission. Limited permission has a shorter application process that takes about 1-2 hours to complete and the fee is £100, and typically it takes less than four weeks for the FCA to confirm authorisation.
Andy added, “CCS would be happy to help with and provide guidance on the FCA application process for any company wishing to work with us and our lending partners. In recent weeks, we’ve assisted several independent Jacuzzi retailers to obtain limited permission, and who have now gone on to use promotional credit to their advantage.”
Dealers do need to be aware that most Lenders have minimum lending criteria which means they typically need to have been operating for at least two years and have a turnover in the region of £500k or more.
# ENDS #