Solo Stove maker, Solo Brands, reported earnings today for their quarter that ended in September. Unlike Traeger who struggled, Solo Brands posted a good quarter even though they slightly lowered full year guidance. They also had quite a few retail updates.
Products
Innovation
Solo Stove has been releasing new products almost weekly at this point. Some of the more notable were the pellet fueled Tower patio heater and the Mesa tabletop fire pit. They believe that all this innovation is helping drive sales and momentum for them. The Mesa in particular has been good for them as it’s an entry into the brand at a low price point, which could lead to future sales.
Pi Pizza Oven
Solo Stove launched their Pi pizza oven last spring and have been happy with the sales of it. They plan on expanding the Pi internationally by year end. Much like pizza oven competitor Ooni, Solo Stove launched a pizza ingredient consumable line this year. They plan on expanding that in 2023.
One other piece of good news for the Solo Stove Pi is it was included on Oprah’s Favorite Things 2022 List. It’s not a pay to play list and items on that list usually lead to higher sales.
Retailers
Solo Stove is traditionally a direct to consumer (DTC) brand, so much so that the stock symbol for Solo Brands is DTC. They are expanding into more wholesale relationships though as they are targeting an 80/20 split on DTC to wholesale.
They announced on the call that they’re expanding into Canada with retail partner Canadian Tire. There is no mention of that anywhere yet, but watch for Solo Stove products in Canadian Tire locations soon.
Solo Stove also talked about a relationship they formed with Costco during the quarter. They entered into an agreement with Costco to sell legacy Solo Stove 1.0 (no removeable ash pan) inventory. They’re looking at adding additional SKUs in spring of 2023.
Knock-offs
One things that Solo Stove has been dealing with is knock-off Solo Stove products. While there are other great, unique fire pits on the market, many are designed very similarly to a Solo Stove. What’s interesting about the relationship with Costco is they sold a similar product to a Solo Stove made by Dyna-Glo’s parent, GHP Group. Under Solo Stove’s relationship with Costco, they’ll no longer sell the GHP Group fire pit.
On the previous quarter’s conference call Solo Brands mentioned that things were going well with defending their IP. They said on this call that there was a positive result in their fight with Duraflame over a fire pit they made that is similar to the Solo Stove. If you’re not familiar with the case, we wrote an article about it where it’s alleged that Duraflame stole the design after meeting with Solo Stove.
Consumers
Solo Brands noted on their call that despite having good sales on the quarter, they haven’t been more promotional this year compared to last. They also don’t plan to be through the rest of the year. That’s important because Q4 is Solo Stove’s biggest quarter.
One thing they mentioned is that consumer behavior has been different this year heading into the holiday season. Consumers were shopping much earlier last year out of fear of supply chain issues disrupting their purchases. Solo Stove saw holiday buying as early as October last year, but haven’t seen hardly any this year. They’re hoping it’s a return to normal buying behavior as opposed to an indicator of a soft selling season.