Hayward Holdings, Inc. (HAYW): Business Model Canvas [10-2024 Updated]

Understanding the business model of Hayward Holdings, Inc. (HAYW) reveals how this leading manufacturer of pool equipment thrives in a competitive market. With a strong emphasis on innovation and sustainability, Hayward leverages key partnerships and advanced manufacturing capabilities to deliver high-quality products. Dive into the details of their Business Model Canvas to uncover how they create value for diverse customer segments and maintain robust revenue streams.

Hayward Holdings, Inc. (HAYW) - Business Model: Key Partnerships

Collaborations with distributors and retailers

Hayward Holdings, Inc. relies on a network of distributors and retailers to market and sell its products. For the three months ended September 28, 2024, external net sales from North America were $194,968,000, while sales from Europe & Rest of World totaled $32,601,000, bringing total external net sales to $227,569,000. The company’s strategy emphasizes enhancing relationships with distributors to optimize market reach and customer service.

Long-term relationships with suppliers

Hayward maintains long-term relationships with key suppliers to ensure a stable supply chain. The company’s total inventory as of September 28, 2024, was $229,363,000, consisting of raw materials ($87,359,000), work in progress ($21,378,000), and finished goods ($120,626,000). This inventory management is critical for maintaining production efficiency and meeting customer demand.

Partnerships with technology providers for IoT solutions

Hayward has established partnerships with technology providers to enhance its product offerings through Internet of Things (IoT) solutions. These partnerships are aimed at integrating smart technologies into pool equipment, which can improve user experience and operational efficiency. The company has invested in research and development, with total capital expenditures of $6,819,000 for the three months ended September 28, 2024.

Strategic alliances with pool builders and service companies

Strategic alliances with pool builders and service companies are vital for Hayward's growth strategy. These partnerships facilitate the distribution of Hayward products in new constructions and service markets. For the nine months ended September 28, 2024, Hayward reported total net income of $63,922,000, highlighting the financial benefits of these strategic alliances.

Partnership Type	Details	Financial Impact
Distributors/Retailers	Network of distributors and retailers across North America and Europe	External net sales of $227,569,000 for Q3 2024
Suppliers	Long-term relationships to ensure supply chain stability	Total inventory of $229,363,000 as of September 28, 2024
Technology Providers	Partnerships for IoT integration in pool equipment	R&D capital expenditures of $6,819,000 for Q3 2024
Pool Builders/Service Companies	Strategic alliances for product distribution	Total net income of $63,922,000 for the nine months ended September 28, 2024

Hayward Holdings, Inc. (HAYW) - Business Model: Key Activities

Designing and manufacturing pool equipment

Hayward Holdings, Inc. specializes in the design and manufacturing of a comprehensive range of pool equipment, including pumps, filters, heaters, and automation systems. In the fiscal year 2024, the company reported net sales of $724.5 million, with residential pool products contributing significantly, accounting for $652.7 million of the sales. The manufacturing processes are supported by advanced technology and efficient production lines, enabling the company to maintain a competitive edge in product quality and innovation.

Conducting research and development for innovative products

Investment in research and development (R&D) is critical for Hayward to drive innovation in the pool equipment sector. For the nine months ended September 28, 2024, the company incurred R&D expenses totaling $18.9 million. This investment focuses on developing new technologies and improving existing products, ensuring that Hayward meets evolving customer demands and regulatory standards.

Marketing and sales through various channels

Hayward employs a multifaceted marketing strategy to reach its customers, utilizing both traditional and digital channels. The company reported selling, general, and administrative expenses of $187.7 million for the nine months ended September 28, 2024. This includes costs associated with advertising, promotions, and sales force management. The sales team works closely with distributors and retailers across various geographic regions, including the U.S., Canada, and Europe, to maximize market penetration and brand visibility.

Managing supply chain and logistics for distribution

Effective supply chain management is vital for Hayward to ensure timely delivery of products to customers. The company reported total inventory of $229.4 million as of September 28, 2024, consisting of raw materials, work in progress, and finished goods. The logistics operations are designed to optimize distribution efficiency, reduce costs, and maintain high service levels, thus supporting the overall business model.

Key Activity	Details	Financial Data
Designing and Manufacturing	Specializes in pool equipment such as pumps, filters, and automation systems.	Net sales: $724.5 million (2024)
Research and Development	Focus on innovation and regulatory compliance.	R&D expenses: $18.9 million (2024)
Marketing and Sales	Utilizes traditional and digital marketing channels.	Selling and administrative expenses: $187.7 million (2024)
Supply Chain Management	Efficient logistics and distribution operations.	Total inventory: $229.4 million (2024)

Hayward Holdings, Inc. (HAYW) - Business Model: Key Resources

Extensive manufacturing facilities in North America and Europe

Hayward Holdings operates multiple manufacturing facilities strategically located in North America and Europe, which enable efficient production and distribution of their pool equipment. The company's facilities are designed to optimize production workflows and reduce lead times, contributing to a robust supply chain. As of September 28, 2024, total inventory amounted to $229.4 million, with finished goods representing $120.6 million.

Strong brand recognition in the pool industry

Hayward has established a strong brand presence in the pool industry, recognized for quality and innovation. This brand equity allows the company to command premium pricing on its products. The residential pool segment generated net sales of $652.7 million for the nine months ended September 28, 2024, reflecting the strength of its brand in driving customer loyalty and sales.

Skilled workforce with industry expertise

Hayward's workforce is a critical resource, consisting of skilled professionals with extensive industry knowledge. The company invests in training and development to retain talent and enhance productivity. As of September 28, 2024, total selling, general, and administrative expenses were $187.7 million for the nine months ended, indicating significant investment in human capital.

Proprietary technologies and patents in pool equipment

Hayward holds several proprietary technologies and patents that provide a competitive edge in the market. These innovations enhance product efficiency and reliability, driving customer satisfaction. The company has incurred approximately $18.9 million in research, development, and engineering expenses for the nine months ended September 28, 2024, underscoring its commitment to technological advancement.

Resource Type	Description	Value/Impact
Manufacturing Facilities	North America and Europe	Total Inventory: $229.4 million
Brand Recognition	Strong presence in the pool industry	Residential Pool Sales: $652.7 million
Workforce	Skilled professionals with industry expertise	SG&A Expenses: $187.7 million
Proprietary Technologies	Patents in pool equipment	R&D Expenses: $18.9 million

Hayward Holdings, Inc. (HAYW) - Business Model: Value Propositions

High-quality, energy-efficient pool and outdoor living products

Hayward Holdings, Inc. specializes in providing high-quality, energy-efficient pool and outdoor living products. The company reported net sales of $227.6 million for the three months ended September 28, 2024, reflecting a 3.3% increase from $220.3 million in the same period in 2023 . This growth was driven primarily by a net price increase and the positive impact from acquisitions, despite a decline in sales volume due to decreased new construction activities in the U.S.

Comprehensive aftermarket support for maintenance and upgrades

Hayward emphasizes comprehensive aftermarket support for maintenance and upgrades, ensuring customers have access to necessary services and parts. The warranty reserve for their products was approximately $20.1 million as of September 28, 2024 . This reflects the company's commitment to customer satisfaction and product reliability, addressing customer needs for ongoing support and maintenance of their pool systems.

Innovative solutions that enhance user experience

The company has invested in innovative solutions aimed at enhancing user experience. Research and development (R&D) expenses were recorded at $6.4 million for the three months ended September 28, 2024, compared to $6.2 million during the same period last year . Such investments are directed towards developing advanced technologies that improve the functionality and efficiency of pool systems, aligning with customer demands for smarter, more user-friendly products.

Commitment to sustainability and environmental responsibility

Hayward has made a strong commitment to sustainability and environmental responsibility. The company’s gross profit margin rose to 52.3% for the three months ended September 28, 2024, an increase attributed to operational efficiencies and cost management . This focus on sustainability not only enhances their brand image but also appeals to environmentally conscious consumers who prioritize eco-friendly products.

Financial Metrics	Q3 2024	Q3 2023	Change (%)
Net Sales	$227.6 million	$220.3 million	3.3%
Gross Profit	$113.1 million	$105.4 million	7.3%
Gross Profit Margin	52.3%	49.7%	190 bps
R&D Expenses	$6.4 million	$6.2 million	3.2%
Warranty Reserve	$20.1 million	$17.0 million	18.3%

Hayward Holdings, Inc. (HAYW) - Business Model: Customer Relationships

Focus on building long-term relationships with customers

Hayward Holdings, Inc. emphasizes the importance of establishing long-term relationships with its customers, particularly in the residential and commercial pool markets. The company reported net sales of $724.5 million for the nine months ended September 28, 2024, compared to $713.9 million for the same period in 2023, reflecting a growth strategy focused on customer retention and loyalty.

Providing exceptional customer service and support

The company's dedication to customer service is evidenced by an increase in Selling, General, and Administrative (SG&A) expenses, which rose to $187.7 million in the nine months ending September 28, 2024, up from $172.1 million for the same period in 2023. This increase is primarily attributed to investments in customer care and support teams.

Engaging with customers through feedback and product improvements

Hayward actively engages its customers for feedback, which plays a crucial role in product development and improvement. The company invests approximately 2.6% of its net sales in Research, Development, and Engineering (RD&E), amounting to $18.9 million for the nine months ended September 28, 2024, which remains consistent with the previous year's spending.

Offering loyalty programs and incentives for repeat purchases

Hayward has implemented various loyalty programs and incentives to encourage repeat purchases. While specific financial data on loyalty program participation is not disclosed, the overall increase in customer retention is reflected in the growth of gross profit, which increased to $362.8 million for the nine months ended September 28, 2024, from $339.8 million in the same period of 2023.

Category	2024 (Nine Months)	2023 (Nine Months)	Change
Net Sales	$724.5 million	$713.9 million	+1.0%
SG&A Expenses	$187.7 million	$172.1 million	+9.1%
RD&E Expenses	$18.9 million	$19.0 million	-0.5%
Gross Profit	$362.8 million	$339.8 million	+6.8%

Hayward Holdings, Inc. (HAYW) - Business Model: Channels

Direct sales to distributors and retailers

Hayward Holdings, Inc. primarily sells its products through a network of distributors and retailers. For the three months ended September 28, 2024, external net sales amounted to $194.97 million in North America and $32.60 million in Europe & Rest of World, totaling $227.57 million. The year-over-year increase in net sales was driven by a 5.3% rise in price, net of discounts and allowances.

Online platforms for product information and sales

Hayward leverages its online platforms to provide comprehensive product information and facilitate sales. The company reported an increase in gross profit margin to 52.3% for the three months ended September 28, 2024, up from 49.4% in the same period the previous year, which reflects operational efficiencies likely supported by digital initiatives. The company has also been enhancing its e-commerce capabilities, aligning with industry trends towards increased online purchasing.

Trade shows and industry events for brand visibility

Participation in trade shows and industry events is a key strategy for Hayward to enhance brand visibility. In 2024, the company actively participated in several key industry events, which contributed to their brand recognition and customer engagement. Such events provide Hayward with a platform to showcase its latest innovations and connect directly with potential customers and partners.

Partnerships with pool service companies for installation and maintenance

Hayward has established partnerships with pool service companies, which facilitate the installation and maintenance of their products. This strategy not only extends their market reach but also enhances customer satisfaction by ensuring professional service. The company reported a segment income of $51.57 million for North America for the three months ended September 28, 2024, indicating strong performance in their operational channels.

Channel Type	Sales (in millions)	Gross Profit Margin (%)	Segment Income (in millions)
Direct Sales to Distributors and Retailers	$227.57	52.3	$54.04
Online Platforms	N/A	N/A	N/A
Trade Shows and Events	N/A	N/A	N/A
Partnerships with Pool Service Companies	N/A	N/A	$51.57

Hayward Holdings, Inc. (HAYW) - Business Model: Customer Segments

Residential pool owners in North America

Hayward Holdings, Inc. targets residential pool owners primarily in North America, a segment that accounts for a significant portion of its revenue. In the most recent fiscal year, net sales in North America reached approximately $609.5 million, with a considerable focus on residential products such as pool pumps, filters, and heaters.

Commercial pool operators and facilities

The commercial pool operators segment includes hotels, resorts, water parks, and community pools. This market contributed approximately $115.0 million in net sales during the last nine months. Hayward's offerings for this segment include advanced filtration systems and automated controls that enhance operational efficiency and user experience.

Pool builders and contractors

Hayward also serves pool builders and contractors, providing them with a range of products tailored for new installations and renovations. The company has established strong relationships with these professionals, which is reflected in their robust sales growth. For the nine months ended September 28, 2024, the company reported a total segment income of $166.6 million from North America, which includes contributions from this customer segment.

International markets in Europe and Asia Pacific

Hayward is expanding its footprint in international markets, particularly in Europe and the Asia Pacific region. The company reported external net sales of approximately $32.6 million in Europe for the third quarter of 2024. This segment is expected to grow as Hayward continues to enhance its distribution networks and product offerings tailored to local market needs.

Customer Segment	Net Sales (in millions)	Contribution to Total Revenue (%)	Key Products
Residential Pool Owners (North America)	$609.5	84.2%	Pumps, Filters, Heaters
Commercial Pool Operators	$115.0	15.8%	Filtration Systems, Automated Controls
Pool Builders and Contractors	$166.6	22.9%	Installation Products, Renovation Supplies
International Markets (Europe & Asia Pacific)	$32.6	4.5%	Localized Pool Equipment

Hayward Holdings, Inc. (HAYW) - Business Model: Cost Structure

Manufacturing and production costs

For the three months ended September 28, 2024, Hayward Holdings reported a cost of sales of $114.5 million, slightly down from $114.9 million for the same period in 2023. For the nine months ended September 28, 2024, the cost of sales totaled $361.8 million, compared to $374.2 million for the same period in 2023. This reflects ongoing efforts to optimize manufacturing efficiencies and manage production costs.

Research and development expenses

Research, development, and engineering (RD&E) expenses increased to $6.4 million for the three months ended September 28, 2024, compared to $6.2 million for the same period in 2023. For the nine months ended September 28, 2024, RD&E expenses remained stable at $18.9 million, slightly down from $19.0 million in the same period of 2023. As a percentage of net sales, RD&E was 2.8% for the three months ended September 28, 2024, and 2.6% for the nine months ended September 28, 2024.

Marketing and sales expenditures

Selling, general, and administrative expenses (SG&A) increased to $64.5 million for the three months ended September 28, 2024, up from $59.5 million in the same quarter of 2023. For the nine months ended September 28, 2024, SG&A totaled $187.7 million, an increase from $172.1 million year-over-year. This increase is attributed to higher salary costs driven by wage inflation and investments in customer care and sales teams.

Administrative and operational overhead

Administrative and operational overhead costs include various expenses related to corporate operations. For the three months ended September 28, 2024, Hayward Holdings incurred $7.6 million in amortization of intangible assets, consistent with the previous year. In the same period, acquisition and restructuring-related expenses amounted to $1.1 million, showing a decrease from $3.3 million in the comparable quarter of 2023. The nine-month figures show amortization of $21.4 million and restructuring expenses of $2.5 million.

Cost Category	Q3 2024 Expense (in millions)	Q3 2023 Expense (in millions)	YTD 2024 Expense (in millions)	YTD 2023 Expense (in millions)
Cost of Sales	114.5	114.9	361.8	374.2
Research & Development	6.4	6.2	18.9	19.0
Selling, General & Administrative	64.5	59.5	187.7	172.1
Amortization of Intangible Assets	7.6	7.5	21.4	22.8
Acquisition & Restructuring Expenses	1.1	3.3	2.5	6.2

Hayward Holdings, Inc. (HAYW) - Business Model: Revenue Streams

Sales of pool equipment and supplies

The primary revenue stream for Hayward Holdings, Inc. comes from the sales of pool equipment and supplies. For the nine months ended September 28, 2024, the net sales from residential pool equipment amounted to $652.7 million, while commercial pool equipment sales contributed $34.3 million. The total net sales in this category were $724.5 million for the same period.

Recurring revenue from aftermarket services and parts

Hayward generates significant recurring revenue through its aftermarket services and parts. This stream includes sales of replacement parts and maintenance services for existing pool systems, contributing to customer loyalty and repeat business. The company reported aftermarket sales as part of its overall gross profit, which reached $362.8 million for the nine months ended September 28, 2024.

Revenue from international sales in Europe and Asia

International sales have become an increasingly important revenue stream for Hayward. For the nine months ended September 28, 2024, Hayward generated $71.3 million from sales in Europe and $43.7 million from the Rest of World, which includes Asia. This demonstrates the company's ability to expand its market presence beyond North America, where total net sales were $562.5 million during the same period.

Income from technology licensing and partnerships

Hayward also earns revenue through technology licensing and strategic partnerships. These arrangements allow Hayward to monetize its innovations and proprietary technologies, further diversifying its income sources. Specific figures for income generated from these licenses are not detailed in the financial reports, but they play a crucial role in enhancing the company's overall profitability and competitive edge.

Revenue Stream	Q3 2024 Revenue (in millions)	Year-to-Date Revenue (in millions)
Residential Pool Equipment	$200.8	$652.7
Commercial Pool Equipment	$14.2	$34.3
Total Pool Equipment Sales	$227.6	$724.5
International Sales (Europe)	$16.8	$71.3
International Sales (Rest of World)	$15.8	$43.7
Aftermarket Services and Parts	N/A	$362.8

Article updated on 8 Nov 2024

Resources:

1. Hayward Holdings, Inc. (HAYW) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of Hayward Holdings, Inc. (HAYW)' financial performance, including balance sheets, income statements, and cash flow statements.
2. SEC Filings – View Hayward Holdings, Inc. (HAYW)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.