Traeger presented at the Baird 2022 Global Consumer, Technology & Services Conference yesterday. Most of it was spent educating the investor audience on the basics of the grill market, but there were a couple of takeaways.
Unfortunately, the webcast was audio only and there was a section where a presentation was shown with no voiceover. While we enjoy being serenaded with Steppenwolf’s classic Magic Carpet Ride as much as anyone, it would have been nice to see the visual portion as well.
After Traeger CEO Jeremy Andrus finished dropping knowledge on the crowd about how great outdoor cooking is, they got to a Q&A section. While inflation and consumer spending is an obvious headwind, Traeger talked about some emerging tailwinds they are seeing.
Similar to what Solo Brands’ said at their investor day, Traeger is seeing emerging tailwinds around inbound transportation rates. Traeger does all their manufacturing currently in China and Vietnam, with plans to start manufacturing in Mexico later in 2022. Any improvement in inbound transportation rates will be largely beneficial to their supply chain costs due to the global nature of it.
Another positive for their business is they said they expect to see improvement in the raw inputs for their business such as steel and electronics. Beyond just those cost tailwinds, they also mentioned that their flow of goods has improved on the mess that was 2021. They combatted those logistic issues with having higher inventory, so streamlining the flow of goods should be seen in higher cash available.
Unlike how Solo Brands commented that supply chain improvements could mean improved P&L performance this year, Traeger cautioned that any improvement will be seen in 2023 rather than this year.