Entrepreneurs

How the Fireworks Industry Plans to Recover From a Devastating Year? With a Bang

The American fireworks industry is starting the summer strong, but the road to recovery won’t be totally smooth.

Last year, the pandemic put a damper on professional pyrotechnic displays, causing companies that rely on those events to lose up to 90 percent of their annual revenue. Meanwhile, sales of backyard fireworks skyrocketed. This year promises to offer a welcome reprieve from those sluggish times, but shipping delays and product backlogs threaten to keep a lid on consumer fireworks sales.

About 11,000 Independence Day fireworks shows are scheduled to take place around the U.S. this year. That’s a stark comparison to 2020, when there only about two dozen shows. But it pales in comparison to the number of events in a pre-pandemic year. According to Julie L. Heckman, executive director of the American Pyrotechnics Association, an industry group, about 16,000 fireworks shows took place in the U.S. in 2019. The pandemic remains the biggest reason for the deficit: Different parts of the country are lifting restrictions on public gatherings at different rates, and some communities are postponing events due to budget constraints or lack of volunteers. But wildfires are also a concern: some West Coast cities have banned fireworks altogether due to fire risk

But as the summer progresses and more events return, Heckman expects that the country’s roughly 150 professional display companies, many of which are multigenerational family businesses, will get back on their feet. “We’re optimistic,” she says, but adds, “I think they’re going to have to get through 2022 to see a full, solid recovery.”

Atlas PyroVision Entertainment Group, a Jaffrey, New Hampshire company that stages professional displays across New England and has four retail locations, has so far booked about 70 percent of its typical Independence Day display clients. It expects closer to 90 percent recovery later in the year. “We’re getting back to normal, but it’s been gradual,” says Stephen Pelkey, Atlas’s CEO and artistic director. This year poses different challenges, he says, including having to launch shows with much less prep time (as reopening timelines shift) and finding enough seasonal workers to staff them.

Roberto Sorgi, co-owner of American Fireworks in Hudson, Ohio, is even more confident about the display business. “We’re forecasting a record year,” he says. “Industry wide, I think it’ll get back to 100 percent.” 

One area that might still take a hit: consumer fireworks sales. While Americans’ zeal for fireworks in 2020 showed no bounds–with consumer fireworks sales hitting $1.9 billion that year, nearly doubling the 2019 tallythis year could prove more subdued.

Demand remains as strong as it was last year, according to Pelkey and Sorgi, whose companies are among the professional-display companies that also sell consumer fireworks. But the product isn’t available, courtesy of the ongoing global supply-chain crunch that’s been hampering sales of everything from cars to two-by-fours. Fireworks, which largely derive from China, are another victim. “Stores are stocked now, but the ability to restock is going to be the problem,” Heckman says. Fireworks are competing for cargo space with all the other China-made products that Americans have been ordering in large quantities during the pandemic, she says. That limit, combined with factory shutdowns and staffing shortages in the shipping and trucking industries, causes delays every step of the way.

Sorgi predicts that the delays and resulting product shortages won’t be fully resolved until the beginning of 2023. “The average time to get a container of product ordered and to our door from China, once it ships, was usually 45 days,” he says, but now, it sometimes takes three or four months. Shipping costs have also gone up, and retailers are having to pass on that increase to customers. Sorgi’s and Pelkey’s companies have both raised prices by about 15 percent.

With shortages looming, July 4 once again falling on a weekend, and President Biden encouraging Americans to celebrate the holiday along with the country’s progress against Covid-19, fireworks enthusiasts started shopping early. Retail fireworks sales typically peak in the four or five days before July 4, but have been beating expectations since Memorial Day, says Pelkey. Wholesale warehouses are already running out, and the smallest sellers will be left behind.

Companies like Atlas and American Fireworks, that managed to place orders early and aren’t too worried about supply, are enjoying the ride. “All indicators are saying it’s going to be an incredible year for the retail side of the business,” says Sorgi. “So we cross our fingers and hope it keeps rolling.”

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