Pandemic-related restrictions pushed many people away from restaurants, out of their kitchens, and towards their backyard grills, a small comfort in a most unsettling time. And, whether for a simple change of scenery, a desire to experiment with new foods, or try new cooking techniques, outdoor grilling took off amid COVID-19.
But barbeque enthusiasts haven’t been the only ones to capitalize on the situation. So have U.S. grill makers.
Earlier this month, Traeger Inc. and Weber Inc. – the biggest American manufacturers of barbecue grills – filed paperwork for initial public offerings, tapping the IPO market after decades of being privately held.
Sales at both Traeger and Weber have surged, giving the companies some of their best quarterly results ever. Revenue was up 50% at Traeger in 2020, and sales climbed 60% at Weber in the six months through March. With that, grilling enthusiasts can spend as much as $4,000 on a Weber gas grill before adding any accessories, and Traeger’s outdoor kitchen setups can run to the tens of thousands of dollars.
Further supported by record-setting equity markets, a booming IPO market, and strong consumer spending, it’s no surprise that these longtime private companies are changing their approach.
And others are following.
Those Following Suit
Online grilling-and-outdoor-products retailer BBQGuys also agreed to go public this month by combining with a special-purpose acquisition company. The merger values BBQGuys at about $960 million. Solo Stove, which sells fire pits and grills, is also exploring an IPO, people familiar with the matter said.
The pandemic, by keeping people at home, “not only created an economic savings,” says Clayton Hale, Citigroup Inc.’s global head of consumer and retail investment banking, “but it also created an opportunity for business models to take advantage of a natural shift in consumer sentiment, which is, things are now not just purchased to own, things are being purchased because one has a passion.” (Bloomberg, July 16)
The Growing Barbeque Trend
More than 14 million grills and smokers were sold between April 2020 and February 2021, amounting to a 39% increase in dollar sales during the pandemic, compared to the same period a year earlier. Beyond the peak grilling sales season between April and June, which accounted for 43% of the year’s sales, the second half of 2020 saw a continuation of strong performance with dollar growth in excess of 50%. October and November had stronger year-over-year sales growth than the 58% dollar increase seen in May 2020, according to The NPD Group.
Further supporting the growing barbeque trend is the fact that about 59% of consumers expect to continue cooking at home once the pandemic fades, according to FMI – The Food Industry Association.