If this year has felt harder than last year, it's not just you. Three separate pressures — tariff-driven price increases, the loss of the federal tax credit, and a housing market that has slowed to a crawl — landed on hearth and patio dealers at almost exactly the same time. Any one of them would be manageable. All three at once is squeezing dealers from every direction: your costs are up, your best closing tool is gone, and fewer buyers are walking in the door.
The dealers who come out of this stretch stronger won't be the ones who wait it out. They'll be the ones who understand exactly what changed and adjust how they sell and market accordingly. Here's what's happening and what to do about each one.
Pressure #1: Tariffs Have Raised Your Costs — and Your Customers' Prices
The 25% tariffs on steel and aluminum imports that took effect in March 2025, plus additional tariffs on Canadian imports, have worked their way through the entire hearth and outdoor living supply chain. Stoves, fireplaces, inserts, grills, patio furniture — nearly everything on your showroom floor contains tariffed materials or crosses a tariffed border.
Manufacturers aren't absorbing it. Some, like Hearthstone, are adding explicit tariff surcharges to dealer invoices. Others have simply raised wholesale pricing. Either way, you're left with a choice nobody likes: eat the margin or explain a higher price tag to a customer who was quoted less six months ago.
On the outdoor side, fuel costs are making it worse. Propane benchmarks have surged roughly 60% since the Middle East conflict escalated, which directly affects demand for patio heaters and gas-fired outdoor products.
What to do about it:
- Get ahead of the price conversation instead of hiding from it. Buyers are reading about tariffs in the news. A dealer who explains why prices moved — and positions today's price against the likelihood of further increases — turns a defensive conversation into a reason to buy now rather than later.
- Sell value, not price. When prices rise everywhere, the dealer who competes only on price loses to the internet. Your installation expertise, service department, and brand authorizations are the things a big box store or online retailer can't match — and they need to be front and center in your advertising, not buried on an About page.
- Recover margin through co-op funds. If tariffs are compressing your margins, the co-op advertising money your manufacturers set aside on every purchase matters more than ever. Most dealers leave a large share of it unclaimed. Here's how those programs work and how to collect what you've earned.
Pressure #2: The Federal Tax Credit Is Gone
For three years, the 25C Energy Efficient Home Improvement credit was the single best closing tool in the hearth industry: a 30% federal tax credit, up to $2,000, on qualifying high-efficiency wood and pellet stoves. It expired on December 31, 2025 under the Budget Reconciliation Act — and it took a lot of dealers' go-to pitch with it.
The timing could hardly be worse. The credit disappeared at the same moment tariffs pushed prices up, so the effective cost of a wood or pellet stove jumped twice in the same year from the buyer's perspective.
What to do about it:
- Know your state and local incentives cold. Several states, utilities, and air-quality districts still offer rebates and change-out programs for cleaner-burning appliances. If you can tell a customer exactly what's available in your area — with the paperwork ready — you've replaced part of the incentive your competitors stopped talking about.
- Lead with financing. A $4,500 stove is a harder conversation than it was in 2025. A monthly payment isn't. If you offer financing and your advertising doesn't say so prominently, you're leaving your best remaining affordability lever invisible.
- Update your website and ads now. If your site still promotes the federal tax credit, you have a compliance problem and a trust problem. Worse, ads and landing pages built around the credit are now actively misleading the customers they attract. This is worth a same-week audit.
Not sure what your marketing should say now that the tax credit is gone? That's exactly the kind of thing I help dealers work through. Book a free consultation and we'll look at your current messaging together.
Pressure #3: The Housing Market Has Stalled — and Your Foot Traffic With It
Harvard's 2026 State of the Nation's Housing report paints the picture: home sales near standstill, consumer sentiment at historic lows, household debt rising. Fireplaces, outdoor kitchens, and patio installations are exactly the kind of big-ticket, discretionary purchases that households postpone when they feel uncertain.
There's a second-order effect too. A huge share of hearth and outdoor living projects are triggered by a home changing hands — the new owner renovating, the seller sprucing up. Fewer transactions means fewer of those trigger moments, independent of how any individual customer feels about the economy.
What to do about it:
- Fight for a bigger share of a smaller pie. When fewer people are shopping, being the first dealer they find matters more, not less. The buyers who are in the market right now are serious — and they're finding somebody. If it isn't you, this is why.
- Market to the "staying put" homeowner. The flip side of a frozen housing market: people who can't afford to move invest in the home they have. "Love the home you're in" is a genuinely strong message right now for fireplace upgrades, outdoor living spaces, and hearth remodels — and it speaks directly to the largest audience in your market.
- Stay top of mind for the buyers who are waiting. Postponed isn't cancelled. Email marketing and brand awareness campaigns are the cheapest way to make sure that when a hesitant homeowner finally pulls the trigger, your showroom is the one they think of first. Your past customer list is the place to start.
The Common Thread: Your Marketing Has to Work Harder Than It Did Last Year
Notice what all three pressures have in common. None of them are things a dealer can fix at the loading dock. You can't repeal a tariff, reinstate a tax credit, or unfreeze the housing market. What you can control is whether the customers who are still buying find you first, hear a reason to buy now, and see value that justifies today's prices.
In a strong market, mediocre marketing gets bailed out by demand. In this market, it doesn't. The dealers I see holding revenue steady in 2026 are doing three things: they're visible in every place a local buyer searches, they've rebuilt their messaging around financing and value instead of the expired credit, and they're using co-op dollars to fund it so the pressure on their own budget stays manageable.
That's not a silver lining — it's a playbook. The squeeze is real, but it's hitting your competitors just as hard. The question is who adjusts first.