Latham Group, Inc. (SWIM): Business Model Canvas [11-2024 Updated]

Latham Group, Inc. (SWIM): Business Model Canvas
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Discover the innovative business model of Latham Group, Inc. (SWIM), a leader in the swimming pool industry. This comprehensive analysis explores how Latham's strategic partnerships, key activities, and unique value propositions drive its success. From a strong direct-to-consumer marketing approach to a commitment to quality and safety, learn how Latham effectively caters to homeowners, contractors, and commercial clients alike. Dive deeper into the elements that make up their business model canvas below.


Latham Group, Inc. (SWIM) - Business Model: Key Partnerships

Long-term dealer relationships averaging over 14 years

Latham Group maintains strong partnerships with its dealers, averaging over 14 years in duration. These relationships are supported by business development tools and co-branded marketing programs, enabling successful sales strategies across various regions.

Strategic acquisition of Coverstar Central for safety cover distribution

On August 2, 2024, Latham Group completed the acquisition of Coverstar Central, LLC for a total consideration of $71.0 million. This consisted of $66.1 million in cash and $4.9 million in non-cash settlements of preexisting obligations. This acquisition enhances vertical integration in the automatic safety cover product category and increases Latham's dealer and franchise relationships.

Item Value (in thousands)
Total Consideration $71,035
Cash $66,100
Trade Receivables $7,020
Inventories $4,293
Intangible Assets $38,220
Goodwill $21,566

Partnerships with suppliers for raw materials and components

Latham Group collaborates with various suppliers to secure raw materials and components essential for production. As of September 28, 2024, the company's cost of sales was $288.9 million, reflecting effective supplier optimization and lower material costs.

Collaboration with marketing agencies for consumer outreach

Latham works closely with marketing agencies to enhance consumer outreach, particularly through digital channels. This strategy has transformed traditional marketing approaches, allowing for direct engagement with homeowners, thus bolstering demand for their products.


Latham Group, Inc. (SWIM) - Business Model: Key Activities

Designing and manufacturing in-ground swimming pools

Latham Group, Inc. specializes in designing and manufacturing fiberglass in-ground swimming pools. The company reported a net sales figure of $150.5 million for the fiscal quarter ended September 28, 2024, which reflects a decrease from $160.8 million in the same quarter of the previous year. The decline in net sales was attributed to a $9.5 million decrease in sales volume and a $0.8 million decrease from lower pricing.

Marketing fiberglass pool products directly to homeowners

Marketing efforts are primarily directed towards homeowners, with a notable focus on increasing awareness and conversion to fiberglass pool products. The selling, general, and administrative expenses for the fiscal quarter ended September 28, 2024, reached $28.3 million, up from $23.4 million in the prior year. This increase is largely due to heightened spending on sales and marketing initiatives aimed at positioning the company for market recovery.

Implementing lean manufacturing initiatives for efficiency

Latham has implemented lean manufacturing initiatives to enhance operational efficiency. The cost of sales for the fiscal quarter ended September 28, 2024, was $101.8 million, down from $112.6 million the previous year, indicating a significant improvement in production efficiency. Gross margin increased to 32.4% of net sales for the same period, up from 29.9% the previous year, largely due to these efficiency measures.

Conducting product development and innovation

The company continues to invest in product development and innovation, particularly in fiberglass pools and safety covers. The recent acquisition of Coverstar Central for $64.0 million is expected to enhance product offerings and market reach. This strategic acquisition is anticipated to drive sales growth and improve margins through vertical integration of the automatic safety cover product line.

Key Metrics Q3 2024 Q3 2023 Change
Net Sales $150.5 million $160.8 million -6.4%
Cost of Sales $101.8 million $112.6 million -9.6%
Gross Margin 32.4% 29.9% +2.5%
Selling, General, and Administrative Expenses $28.3 million $23.4 million +20.9%
Net Income $5.9 million $6.2 million -4.2%

Latham Group, Inc. (SWIM) - Business Model: Key Resources

Extensive portfolio of pool products (fiberglass and vinyl)

Latham Group, Inc. offers a wide range of pool products, primarily focusing on fiberglass and vinyl pools. The company reported net sales of $421.2 million for the three fiscal quarters ended September 28, 2024, down from $475.6 million for the same period in 2023, indicating a strategic shift in product offerings and market adaptation . The decrease in sales volume was attributed to macroeconomic challenges, particularly impacting in-ground swimming pools, which saw a $36.5 million decline .

Skilled workforce of approximately 1,850 employees

Latham Group employs approximately 1,850 individuals, contributing to its operational efficiency and product development capabilities. This skilled workforce is essential for maintaining high standards in manufacturing and customer service. The company has implemented cost containment initiatives, resulting in a 6.4% decrease in selling, general, and administrative expenses to $81.2 million for the three fiscal quarters ended September 28, 2024 .

State-of-the-art manufacturing facilities across multiple locations

Latham Group operates several advanced manufacturing facilities designed to enhance production capacity and efficiency. The company invested approximately $13.9 million in property and equipment in the fiscal quarter ended September 28, 2024, primarily to expand its manufacturing capabilities . The company’s commitment to lean manufacturing practices has driven operational improvements, contributing to an increase in gross margin to 31.4% .

Strong brand reputation in the swimming pool industry

Latham Group has established a robust brand reputation in the swimming pool industry, recognized for quality and innovation. The acquisition of Coverstar Central on August 2, 2024, for $64 million is a strategic move to bolster its brand presence and product offerings in automatic safety covers, enhancing market competitiveness . This strategic acquisition is expected to accelerate sales growth and improve margins through vertical integration .

Key Resource Description Financial Impact
Extensive portfolio of pool products Includes fiberglass and vinyl pools Net sales decreased to $421.2 million in 2024
Skilled workforce Approximately 1,850 employees SG&A expenses reduced by 6.4% to $81.2 million
Manufacturing facilities State-of-the-art facilities supporting production Investment of $13.9 million in capacity expansion
Brand reputation Strong presence in the swimming pool industry Acquisition of Coverstar Central for $64 million

Latham Group, Inc. (SWIM) - Business Model: Value Propositions

High-quality, customizable pool solutions for homeowners

Latham Group, Inc. offers a range of high-quality, customizable swimming pool products, including fiberglass pools, liners, and safety covers. The company reported net sales of $421.2 million for the three fiscal quarters ended September 28, 2024, reflecting a decrease of 11.4% compared to $475.6 million for the same period in 2023. This decrease was attributed to a $51.7 million reduction in sales volume and $2.7 million from lower pricing, indicating the impacts of macroeconomic conditions on consumer demand.

Direct-to-consumer marketing strategy enhancing customer engagement

Latham employs a direct-to-consumer marketing strategy designed to enhance engagement with potential buyers. This approach enables the company to build stronger relationships with customers, ensuring they receive tailored solutions that meet their specific needs. The marketing initiatives are crucial as Latham aims to capture a larger market share, particularly in the fiberglass pool segment, which continues to show resilience despite overall market challenges.

Comprehensive support for dealers through training and tools

The company provides extensive support to its dealers, which includes training programs and tools designed to enhance sales effectiveness and product knowledge. For instance, Latham’s recent acquisition of Coverstar Central, valued at $64 million, is expected to streamline operations and improve dealer support across 29 states. This strategic move aims to integrate sales and marketing efforts, thereby increasing the efficiency of dealer operations and enhancing customer service.

Commitment to safety and innovation in pool products

Latham Group is committed to safety and innovation, particularly in its automatic safety covers and pool technology. The company reported an increase in gross margin to 31.4% of net sales for the three fiscal quarters ended September 28, 2024, up from 27.7% in the same period in 2023. This improvement is largely due to production efficiencies and cost control measures implemented through lean manufacturing practices. Latham's focus on innovative safety features not only meets regulatory standards but also addresses growing consumer demand for safer pool solutions.

Metric Q3 2024 Q3 2023 Change
Net Sales ($ million) 421.2 475.6 -54.4 (-11.4%)
Gross Margin (%) 31.4 27.7 +3.7%
Net Income ($ million) 11.3 -2.5 +13.8
Adjusted EBITDA ($ million) 76.6 78.1 -1.5 (-1.9%)

Latham Group, Inc. (SWIM) - Business Model: Customer Relationships

Direct engagement with homeowners through digital platforms

Latham Group engages directly with homeowners through various digital platforms, enhancing customer interaction and experience. In 2024, the company's net sales were $421.2 million, which reflects a decrease of 11.4% from $475.6 million in 2023. This decline was largely attributed to macroeconomic challenges, yet the digital engagement initiatives remain a focal point for customer acquisition and retention.

Ongoing support for dealers with business development resources

The company provides continuous support to its dealers, offering various business development resources aimed at enhancing their performance and satisfaction. This includes training programs, marketing materials, and operational support. For the three fiscal quarters ended September 28, 2024, Latham Group's selling, general, and administrative expenses were $81.2 million, down from $86.7 million in the same period of the previous year, indicating effective cost management while still investing in dealer support.

Customer service focused on satisfaction and product education

Customer service at Latham Group prioritizes customer satisfaction and extensive product education. The company emphasizes training its customer service representatives to ensure knowledgeable support. Net income for the three fiscal quarters ended September 28, 2024, was $11.3 million, a significant improvement from a net loss of $2.5 million in the same period the previous year, showcasing the effectiveness of customer-centric strategies.

Loyalty programs and incentives for repeat customers

Latham Group has implemented loyalty programs designed to incentivize repeat customers. These programs are part of a broader strategy to enhance customer retention and drive sales. The Adjusted EBITDA for the three fiscal quarters ended September 28, 2024, was $76.6 million, compared to $78.1 million in the same period of 2023, reflecting a focus on maintaining profitability through customer loyalty initiatives despite overall sales decreases.

Metric Q3 2024 Q3 2023 Change
Net Sales $421.2 million $475.6 million -11.4%
Net Income $11.3 million $(2.5 million) +552.4%
Adjusted EBITDA $76.6 million $78.1 million -1.9%
Selling, General & Administrative Expenses $81.2 million $86.7 million -6.4%

Latham Group, Inc. (SWIM) - Business Model: Channels

Direct sales through a network of dealers

Latham Group, Inc. utilizes a robust network of dealers for direct sales. As of 2024, the company has established partnerships with approximately 1,500 dealers across the United States. These dealers play a crucial role in distributing Latham's products, including fiberglass pools, liners, and covers. In the fiscal quarter ended September 28, 2024, Latham reported net sales of $150.5 million, a decrease from $160.8 million in the same period of the previous year, largely attributed to lower sales volume and pricing pressures.

Business-to-business distribution channels

Latham Group also engages in business-to-business (B2B) distribution channels. This includes partnerships with pool builders and contractors, which enhance the company's market reach. The acquisition of Coverstar Central, completed on August 2, 2024, adds significant strategic value by integrating Latham's automatic safety cover product line with existing dealer relationships, expected to bolster sales growth in this segment.

Online platforms for consumer engagement and lead generation

In addition to traditional sales methods, Latham Group has invested in online platforms for consumer engagement and lead generation. The company leverages digital marketing strategies to reach potential customers and facilitate inquiries about its products. The expansion of its online presence is reflected in the increasing traffic to its website, which has seen a year-over-year rise of 25% in unique visitors as of 2024. This strategy aligns with Latham's aim to improve customer engagement and streamline the purchasing process for consumers seeking swimming pool solutions.

Trade shows and industry events for brand promotion

Latham Group actively participates in trade shows and industry events to promote its brand and products. In 2024, the company attended over 10 major industry trade shows, showcasing its latest innovations in pool products. These events serve as a platform for networking with potential dealers, contractors, and consumers. Feedback from these events has indicated strong interest in Latham’s fiberglass pools and safety covers, contributing to positive brand visibility.

Channel Type Description Key Metrics (2024)
Direct Sales Network of approximately 1,500 dealers Net Sales: $150.5 million
B2B Distribution Partnerships with pool builders and contractors Strategic Acquisition: Coverstar Central (August 2024)
Online Platforms Digital marketing for consumer engagement 25% increase in unique website visitors
Trade Shows Participation in industry events for brand promotion Attended over 10 major trade shows

Latham Group, Inc. (SWIM) - Business Model: Customer Segments

Homeowners seeking in-ground swimming pool solutions

Latham Group, Inc. primarily targets homeowners looking for high-quality in-ground swimming pool solutions. In 2024, the residential pool market is experiencing a downturn, with Latham reporting a decrease of $36.5 million in net sales for in-ground swimming pools for the three fiscal quarters ended September 28, 2024, compared to the same period in the previous year. The company aims to enhance the homeowner experience through a direct-to-consumer marketing strategy, which has transformed the traditional purchasing journey in the pool industry.

Pool builders and contractors as dealer partners

Latham collaborates extensively with a network of pool builders and contractors who serve as dealer partners. The company has long-standing relationships with these partners, averaging over 14 years. This network is essential for distributing Latham's products, including pool liners and covers. In 2024, Latham's dealer network supports its sales through co-branded marketing programs and training initiatives aimed at increasing sales efficiency and product knowledge.

Commercial establishments requiring pool installations

Commercial establishments, including hotels, resorts, and recreational facilities, form another key customer segment for Latham Group. These clients require specialized pool installations that meet specific regulatory standards. The demand for commercial pool installations has been impacted by macroeconomic conditions, reflecting a general slowdown in consumer spending affecting the entire pool industry. The company reported a total net sales decrease of 11.4%, or $54.4 million, for the three fiscal quarters ended September 28, 2024.

Consumers looking for pool accessories and maintenance products

Alongside its core pool offerings, Latham also targets consumers seeking pool accessories and maintenance products. This segment includes sales of pool covers and liners, with a reported decrease of $9.1 million in net sales for liners and $8.8 million for covers for the three fiscal quarters ended September 28, 2024. The company continues to innovate in this space, leveraging acquisitions such as Coverstar Central to enhance its product offerings.

Customer Segment Key Metrics (2024) Net Sales Change
Homeowners $36.5 million decrease in in-ground pool sales -
Pool Builders & Contractors Long-standing partnerships averaging 14 years -
Commercial Establishments Part of overall 11.4% sales decline -
Consumers for Accessories $9.1 million decrease in liner sales; $8.8 million in covers -

Latham Group, Inc. (SWIM) - Business Model: Cost Structure

Manufacturing and material costs for pool production

For the three fiscal quarters ended September 28, 2024, the cost of sales was $288.9 million, representing 68.6% of net sales of $421.2 million. This marks a decrease of $54.9 million, or 16.0%, compared to the same period in 2023, when the cost of sales was $343.9 million. The decrease in cost of sales was attributed to a reduction in sales volume and improvements in production efficiencies driven by lean manufacturing and value engineering programs.

Selling, general, and administrative expenses

Selling, general, and administrative expenses were $81.2 million for the three fiscal quarters ended September 28, 2024, compared to $86.7 million for the same period in 2023. This reflects a decrease of $5.5 million, or 6.4%. The reduction was primarily due to a $9.8 million decrease in non-cash stock-based compensation, offset by increased spending on performance-based compensation and sales and marketing initiatives.

Expense Type Q3 2024 ($ millions) Q3 2023 ($ millions) Change ($ millions) Change (%)
Cost of Sales 288.9 343.9 (54.9) (16.0%)
Selling, General, and Administrative Expenses 81.2 86.7 (5.5) (6.4%)

Investment in marketing and promotional activities

Increased spending on sales and marketing was noted in Q3 2024 as part of Latham's efforts to strengthen its market position ahead of a projected recovery. The total expenses for marketing and promotional activities were not explicitly detailed but were included in the overall selling, general, and administrative expenses. The company continues to enhance its marketing initiatives to drive adoption of fiberglass pools and automatic safety covers.

Costs associated with dealer support and training programs

While specific figures for dealer support and training costs were not provided, the acquisition of Coverstar Central, completed on August 2, 2024, is expected to enhance dealer support through integrated sales and marketing strategies. The investment in dealer training programs aims to leverage existing relationships with pool builders to increase sales and awareness of Latham's product offerings.

Overall, the cost structure of Latham Group, Inc. reflects a disciplined approach to managing expenses while investing in strategic initiatives to capture market share and drive operational efficiencies.


Latham Group, Inc. (SWIM) - Business Model: Revenue Streams

Sales from fiberglass and vinyl swimming pools

For the three fiscal quarters ended September 28, 2024, Latham Group reported net sales of $421.2 million, a decrease of 11.4% from $475.6 million for the same period in 2023. The decline included a $36.5 million decrease in sales of in-ground swimming pools, attributed to macroeconomic challenges and reduced consumer spending.

Revenue from pool liners and covers

During the same period, Latham experienced a $9.1 million decrease in sales from pool liners and an $8.8 million decrease from pool covers. This revenue contraction reflects the overall slowdown in the swimming pool industry, impacting both new installations and replacement products.

Extended service warranties and custom product contracts

Extended service warranties and custom product contracts contribute additional revenue streams, although specific financial figures for these items were not detailed in the latest reports. However, they are integral to Latham's strategy to enhance customer loyalty and provide ongoing revenue beyond initial sales.

Income from strategic acquisitions enhancing product offerings

On August 2, 2024, Latham completed the acquisition of Coverstar Central for $64 million, a strategic move expected to enhance their automatic safety cover product line across 29 states. This acquisition is anticipated to positively impact margins and sales growth.

Revenue Source Fiscal Quarter Ended September 28, 2024 Fiscal Quarter Ended September 30, 2023 Change
Fiberglass and Vinyl Pools $150.5 million $160.8 million $(10.3 million)
Pool Liners $9.1 million decrease N/A N/A
Pool Covers $8.8 million decrease N/A N/A
Extended Service Warranties N/A N/A N/A
Coverstar Central Acquisition $64 million (purchase price) N/A N/A

Updated on 16 Nov 2024

Resources:

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