Company’s new Iowa plant should be operational before the end of the year
As the pandemic struck, MAAX Spas president and general manager John Johnson, and vice president of sales and marketing Steve O’Shea, thought the industry was about to explode. The pair went to parent company, ABG, and got the go-ahead to expand.
Easier said than done. They couldn’t find the right company to acquire, which was their original intention. But when they began to think about their current factory and where they could make improvements, they realized getting their swim spa production out of the hot tub facility would increase manufacturing capacity for both.
“The data we have show swim spas are the fastest growing market segment, and our forecasts are that it will continue to be the fastest-growing market segment,” Johnson says. “It was a pretty easy sell to our ownership group to make the case for the investment.”
As luck would have it, ABG had an empty facility in Ottumwa, Iowa, where it had previously manufactured bathtubs, but closed it in 2009.
“It was a good opportunity for them to unload it off their books, pass off one headache and give it to us,” Johnson says. “And a great opportunity for us because it helped curb the overall investment into it.”
Turns out, in addition to the building, Ottumwa was a pretty good location for a swim spa factory. It’s closer to some of the company’s suppliers than its Chandler, Arizona, headquarters, has good access to the interstate and a capable workforce. There are several large manufacturing facilities in the area, including John Deere and JBS USA Pork.
“It wasn’t an easy market to find people, but the people you find are skilled,” O’Shea says. Like many in the industry, MAAX has struggled to find factory workers at its plant in Arizona.
“We were concerned about being able to find not just people but good people [in Ottumwa],” Johnson says. “So far, we’ve been pleasantly surprised. We’ve got a lot more people to hire, but so far on the initial go-round it’s been better than we expected.”
Some of those hired early in roles like plant manager and production superintendent, have the opportunity to help oversee the building’s refurbishment (needs include a new roof, electrical and plumbing) and understand how the swim spa line is built. As companies have added swim spas to their offerings, most have had to figure out how to fit the larger structures on their manufacturing lines made for hot tubs, which can be an inefficient and disruptive process. The new facility lets MAAX start its line from scratch.
“It has allowed us to lay out a single production line from start to finish, no twists, no turns,” Johnson says. “It’s been wonderful. Supplying the line, feeding into the production line, having dedicated areas for maintenance and equipment upkeep…and to put it all into one area where it’s specifically designed for this has really been a blessing.”
MAAX is adding all new manufacturing equipment in Iowa and plans to send its swim spa molds up one at a time, slowly increasing factory output as its new employee base gets trained.
“We want to focus first and foremost on quality,” Johnson says. “A startup never goes as smooth as you hope. We are trying to go into it with our eyes open, knowing the transition is not going to be easy. It will take six to eight months to really transition everything over.”
Johnson says the company has an aggressive training schedule planned, with many trips up north for its Chandler team members to get the new crew up to speed.
MAAX Spas’ dealers are applauding the added capacity. “Anything that can be done to build one more hot tub or one more swim spa, everybody is looking at that as a positive thing,” Johnson says.
O’Shea hopes dealers recognize the work going on behind the scenes to help the company prepare for the future during the challenges of the last 20 months.
“2020 was a difficult year and we did absolutely the best we could,” O’Shea says. “The whole time, we were working on the opportunities for the future.” It’s quite an investment: Nearly $3 million to increase wages to retain and hire employees, and over $5 million for the new facility, O’Shea says. “ABG is supporting us and investing in the future of MAAX Spas,” he adds.
Both O’Shea and Johnson think swim spa growth will outlast hot tub growth. They are bullish on the swim spa market, and and want to see MAAX become a top-three manufacturer of swim spas. “We believe we can slip into that spot by the end of 2022,” O’Shea says. “And I don’t believe the swim spa facility is the last opportunity the industry will see in the next year or two from us.”