How Modpools are making a splash in the DTC pool industry

Today, seven years later, Modpools has sold a thousand swimming pools. He opened a second manufacturing plant, in Texas. And, it’s on track to generate $20 million in revenue in 2022. With its easy-to-deliver and relocate swimming pools, Modpools has carved out a niche for itself in the global swimming pool industry – which is expected to grow by 3, $56 billion from 2019 to 2024, according to a Technavio report.

There was an uptick in demand for swimming pools during the pandemic, when “the sudden change in consumer habits favored spending on home improvements and outdoor experiences, including the construction of swimming pools”. according to a September report from IBISWorld. Today, according to the report, “an increasing share of pool equipment sales are likely to be siphoned off by online retailers”, with e-commerce accounting for 14.4% of annual equipment industry growth. swimming pool, from 2017 to 2022.

Modpools products, sold direct to consumers through its website, have been featured on television shows such as “Property Brothers” and “Tiny House Nation”. They are also versatile and can be used in corporate settings such as commercial pools and dog spas. “When everything comes up, it’s ready for plug-and-play,” Rathnam told Modern Retail. “I think that’s what really drew people to our product.”

Personalization and technology are at the heart of the Modpools business model. Customers can design their pools on the company’s website, choosing different colors and sizes. The smaller pool, at 12 feet long, starts at $28,500. The largest pool, at 40 feet long, starts at $53,500. Guests can increase the width of the pool and add seating and stairs for an additional price. Then, once they have their pools, they can add WiFi and control it through an app on their phone. The pools take about eight to 18 weeks to refurbish, but once installed, “you can use them within days,” Rathnam said.

To increase production capabilities, Modpools opened a larger facility in Houston, Texas last fall. The company now has around 100 employees spread across its divisions and sites. While the early stages of the company focused on designing a prototype, “we’re basically a manufacturer now,” Rathnam said.

There was a lot to do. “Building a pool, maybe from the outside, doesn’t look that complicated,” Rathnam said. “But there are really a lot of complicated stages that have a lot to do with temperature and timing… Lots of trial and error. It’s been so difficult that I realized that any major competitor that comes really has an uphill battle.

Above-ground pools are generally less expensive than in-ground pools because they require less construction or landscaping. According to Home Guide, an inground pool costs an average of $35,000. An above ground swimming poolwith installation, costs on average between $1,850 and $4,977.

But integrating them into an existing space requires some math. “Depending on the conditions of the backyard or the environment and the location of the pool, the challenge and the design approach will be different,” said Ana Maria Torres, founder of At Architects in New York, in an email.

The swimming pool market has several components. In addition to companies that sell swimming pools, spas, and swim spas, there are retailers that sell pool-related equipment, cleaning chemicals, maintenance supplies, and pool and garden accessories. There are also building and construction companies that install the pool and service companies that repair and maintain the pool.

One of the biggest players in the swimming pool industry, Pool Corporation, says he distributes more than 160,000 national brand and private label products to approximately 100,000 wholesale customers worldwide. The company posted record growth last quarter, with net sales totaling $2.1 billion.

And above ground pools specifically are seeing new growth. In 2021, nearly 250,000 above ground pools were sold, an increase of 8.7% over 2020, according to PK Data, Inc.

Generally, the pool market operates on a seasonal schedule. According to Michael Anastasiou, research associate at Cowen, businesses stockpile more of their inventory in late winter and early spring to be ready for late spring, summer and early fall.

With much of the world grappling with record high temperatures, recent demand for pools may have less to do with the heat — and more to do with changing consumer behavior, Anastasiou says. “I would say the pool expansion over the last few years has been driven more by a great home/flexible work environment, rather than weather issues,” he told Modern Retail.

Rathnam wanted Modpools to start as a DTC business because “we decided we needed complete control of the product from start to finish,” he said. “We weren’t sure about our profit margins and wanted to make a full margin to fund our growth and not have to bring in investors.”

Going forward, however, the company is looking for a retail partner, ideally in outdoor lifestyle, pool supply or spa areas.

“With our new factory up and running and our new production capacity doubling this year, we plan to launch a reseller/dealer program,” Rathnam said. “We envision this program working best with landscapers, contractors and pool builders and plan to offer them an increasing discount based on the number of pools they sell.”