Peter Arvan: Yes. Great question. So there’s really nothing new about the competition. If I go back, I’ve been in the pool industry now this is my seventh year, I believe. And I can tell you that from the very first – my very first month when I went out and was meeting the team and trying to learn about the market and what would happen, and I would hear these stories about competitors that would go after a piece of business that we would have or we would hear about hypercompetitive pricing at a particular account or a particular product. That was basically the norm, all the way up to the pandemic. We kind of got a break during the pandemic when inventory was scarce and it was more of a question of, do you have it versus how much is it?
So we got a little bit of a reprieve during that period of pandemic spending when people just said, I want I want, I want and those that had it certainly had an advantage. And you know what we did from an investment perspective to make sure that we had product and that allowed us to take share. It allowed us to gain new customers that in the past might not have had a reason to try us as a supplier that we’re perhaps happy with who they were using before that now tried us and got exposure to the vast network and the tools and resources that we offer, which pale in comparison to those of our competitors. So what I would say is that I still hear stories every day about a competitor that is going after a piece of business or trying to liquidate some inventory or trying to raise some cash, putting a ridiculous price into the market.
I think it is isolated. I don’t think it’s anything new, and it’s nothing, quite frankly, that we are worried about. When I consider what we’ve done over the last three years to widen the base of our business, and improve the quality of our value proposition. I think it gives me great confidence in our ability to maintain the share that we gained and continue to gain. Since 2019, through acquisitions and greenfield openings, we have 59 new locations. So there’s 59 more locations today than they were in 2019. If you look at our – what differentiates our network compared to the others, we have about 100 NPT centers, which allow the smaller builders to use our showrooms to have their customers pick out the finishes for a new pool or renovation and remodel.
We have product trainers that teach new customers, new plaster crews, new tile crews, how to apply and how to install our proprietary products. If you look at our private label capabilities, those that we had before the pandemic and then with the addition of Pinch A Penny and Suncoast Chemicals and the fact that we’re vertically integrated from a chemical packaging perspective. Again, nobody that we compete with on the wholesale distribution side has capabilities like that. We think that gives us flexibility. We think that gives us additional capabilities to serve customers. Our focus on speed at the counter and the customer experience. Our focus on – we’ve invested in digital tools in POOL360, as you can see, is gaining traction. The POOL360 water test software that we’ve begun rolling out as a great tool for the independent retailers to improve their chemical business, which, at the same time, will improve our chemical business of our private label chemicals because that is the chemical solution that the software will recommend and takes that variability out of the dealer’s hands in terms of what chemicals to recommend and how much it’s all done through a digital platform.
We’ve invested in marketing capabilities, specific marketing capabilities that help our dealers grow that help drive demand creation, all things that none of our competitors do. So certainly, the market is – I don’t want to paint a picture that the market is not contested. You have competitors, we have good competitors that are trying to grow just as well as we are. But when I look at the tools and resources that we have including, frankly, the best team in the industry, when you look at the – how seasoned our management team is and their years of experience in the multiple sites that they have seen as compared to some of our competitors that are relatively new to the space, I would put our team up against any other team, and they will win that race hands down.
Susan Maklari: Okay, thank you for all the color, Pete, it’s very helpful and good luck with everything.
Peter Arvan: Thank you.
Operator: Our next question comes from David Manthey from Baird. Go ahead.
David Manthey: Hi, good morning, everyone. First question, Pete, or Melanie, could you estimate the second quarter year-to-year change by new pools renovation and maintenance revenues that you experienced? I know it’s not an exact size, but could you give us an idea there? And then also, I don’t know if you mentioned price contribution across blue and green, if you could give us that as well.
Melanie Hart: Yes. So we are seeing probably an impact in the second quarter on the new pool construction. It was about the negative five and the renovation was around a negative three. And then price contribution, we are – on the green side, it’s a little bit less than blue. So we said three to four in total. The green would trend to the lower end of that because they did have some more of the commodity, particularly the piping. That was overall impacting their sales, but their sales for the quarter actually did, how they came in relatively flat.
David Manthey: Your answer to the first question, Melanie, was that – I’m asking about total revenues?
Melanie Hart: Well, I thought you were asking for the walk between kind of last year and this year.
David Manthey: Right. You’re saying your new pools were down, what, 5%.
Melanie Hart: The revenue related to new pools, yes.
David Manthey: Okay. Okay. All right. And then second, speaking of new pools and new pool construction, can that segment reaccelerate in the absence of an improvement in turnover in the housing market and maybe more specifically, a resumption of the Southern migration?
Peter Arvan: Yes. I think, Dave, as I mentioned, what you’re going to see is basically stability at the mid and upper end, the families that have the financial means to do it without financing that are seeing stability in their home values that say, I want a pool, I think that’s going to happen. At this point, I don’t see an acceleration in new pools yet because I don’t see the – what I think it would be the indicators that we would see that the lower end pools come back into favor and a lot of that is going to have to do with, as you mentioned, movement in the housing market. So I’m moving, so I might have freed up some equity, so I have some cash that I can use to build a pool and/or lower interest rates that would encourage me to move forward with a project if I had to finance most of it.
