Bloomberg Audio Studios, podcasts, radio news. Christmas trees.
Have you go?
No, of course not. I buy my Christmas tree honor about my birthday, which is early one. Yes, but we've gone. I've gone both ways over the years. Because my kids were younger, they had some allergies, we would go for several years we went to fake tree. I'm kind of indifferent.
Yeah, we got a bit of both. Do we got like we get one real one for the smell and one fake one for the downstairs.
Right five? So let's how you do it?
All right? It all works out. People have their their play there. Chris Butler joints US National Tree Company CEO joining us here, I believe from Cranford, New Jersey, which is a cool little town there. So Chris talk to us about kind of Christmas decorations. What are people doing these days? What's different today versus I don't know, ten years, fifteen years ago. It seems like people are going nuts for Christmas decorations.
They are going nuts.
Yeah, and I like what both of you guys you switch between the artificial and the reel. We're big fans of real as well as artificial. Obviously, eighty percent of US consumers by artificial trees, and so you know, the reel is definitely the minority. But again, obviously we're big fans of trees in general, but you know it's the
the pre lit now, So trees come pre lit. Obviously, there's no mess, they're a lot cheaper, the materials are a lot better, there's a lot of functionality with the lights that you can get today, and so so that's really what we're seeing. And there's a lot of extra wreaths and garlands and things being bored as well. And I think with the Instagram generation, the show me generation, people are really now decorating to kind of show their friends and show their followers just how beautiful our homes
can be. And so you know, as you said, Carolyn, they have a lot of trees in a lot of different rooms and so you know, maybe the kids have a tree now, the kitchen has a small tree putting the mantlepiece with garlands and small trees. So you know, we're seeing a lot of incremental decorating with a lot of different items and in terms of getting back.
To that swell thing.
So you're right, the main reason people buy a real tree is for that real Christmas smell. We bought a company called Sensicles a few years ago and they are a scented ornament which smells just like Christmas. So if you hang your scentered ornament on an artificial tree, you get that real tree.
That real tree smell as well and noalergies. I'm looking at accord on to your website. First thing, holiday magic begins. Enter a week, win a gift card, Blackout Friday blowout deals up to eighty percent off. How much are you having to think about discounting how much amid perhaps fear of some that where you're getting your supplies from the costs might have to go up in the future.
Yeah, that's a great question.
So look, Black Friday through Cyber Monday this year obviously is one week later, so the holiday season is a week later. So I think every retail ourselves included, are really discounting to make sure that we can take it kind of capture those sales that we might have missed
otherwise given the week's delay in terms of the tariffs. Look, you know, we've been on a diversification kind of trend over the last few years now anyway, trying to diversify ourselves out of just one source of manufacturing, which which
would be China. You know, I think if the tariffs go through, who knows what the tariffs will be or when they will go into effect, but you know, from our standpoint, obviously it's impactful, and so we're trying to diversify a manufacturing base between now and you know, now in kind of twenty twenty six. You know, the promotional things we're doing right now really aren't in answer to that. It's really more just to kind of capture those sales
for this season. But if you are a consumer and you're looking for a tree and you're thinking of buying a tree or other holiday de corps, this year is a great time to buy it, because if those tariffs go into effect, prices will definitely go up.
In the next year or so.
Can you give us a breakdown of sort of how much your supply chain is dependent on China?
Yeah, it's very large today, so I can't give you the exact numbers, but it's very large. But we are diversifying out. We've been on this diversification journey for a few years now, and so you know, probably by the end of twenty twenty six, we could be completely out of China, which you know is a significant change.
So anything particularly the hot cellar this year, Chris.
Yeah, you know, so it's funny.
So my wife loves the sparkly trees, the snowy trees.
And many consumers love those things. But you know what we.
See year after year after year is that green triangle, you know, the kind of the staid, good drink green triangle, solid materials, great lights, multi multi function lights. So you know, it's not a trend driven it's not a trend driven industry. I will say this year disco is back. So who doesn't love a bit of disco with their Christmas trees? So disco is back. Definitely seeing some sales on some
of our kind of disco themed items. But again it is you know, people still do prefer that traditional green tree with either the white lights, clear lights, the multicolor or again we have the dual color functionality. So that's what we see every year.
Are you white lights, Caroline? Are you a different colored?
I think one of ours has multicolored, but I think in general I'm a boring person. I like a white light with only red and gold vibes going on. And then our thing is we collect Christmas decorations from any city that we go, so and then you have to remind yourself where the hell you've got some of these random items. But I'm really interested in not just about the idea of what color lights or what you're whether
you're doing sparkly or disco. But you must be talking, Chris, to people in your industry that are doing the real tree situation too. How much you're going to have help this year by the fact that we're here in the Northeast, we've had terrible lack of water, We've had droughts, and the local Christmas free tree farms next to me have been struggling.
Yeah, you know, it's a great question. Eighty percent of like I said, eighty percent of consumers already by artificial trees versus twenty percent of consumers buying the real trees. So it's a small market already. And yeah, unfortunately with you know, with some climate change or with some just weather in general is definitely hurting. Look Oregon a few years ago got hit. You know, there's some fungus issues
in the Carolinas. So it's it's a tough business to be in making the kind of doing those real trees and look, we're here to pick up the pieces when when you know, they falter with some of their supply chain.
Chris, is there any regionality in your business? Do people in the South, I don't know, spend more on their decorations per capita than the Midwest or anything like that as a pretty standard across the board.
It's pretty standard.
You know, we do see the coastal towns going more for kind of Christmas by the Sea type themes. But typically, you know, our sales are driven by population centers, so, you know, very good sales in the Northeast, obviously California, Texas, Florida. It's really population driven. We don't necessarily see big regional differences in our sales. Anyway we sell, you know, most of our sales are online, so we sell through Amazon, Wayfair.
Home depot based, et cetera.
And so we really see sales driven by, you know, by where people live.
Hey, Chris, thanks so much for joining us. Really appreciate it. Chris Butler, National Tree Company CEO,