A well-known spa maker and retailer has been quietly closing down a significant portion of its manufacturing operations.

Leisure Bay Industries Inc. placed its vacuum spa molds and various factory-related equipment up for auction in early December. It shares an Orlando-area manufacturing facility with Dream Maker Spas — and both are brands of Recreational Warehouse, a Florida-based company that produces and retails a number of spa and pool products.

“I got a flier in the mail, saying [Leisure Bay] was auctioning off its vacuum-molding machines,” said Bruce Rothschild, owner/president of Your Backyard Superstore Inc. in Melbourne. Fla. “I went to the Website where they were holding the auction, and saw they were selling not only all the vacuums and forming pieces, but forklifts, racks, tools — everything.”

The corporate offices of Leisure Bay and Rec Warehouse were not answering calls at press time, but multiple sources close to the companies have confirmed that Leisure Bay is pulling out of the vacuum-molded spa manufacturing business “for financial reasons.”

In addition to liquidating that warehouse’s vacuum-molding equipment, Leisure Bay has been shuttering a number of its retail locations, according to sources familiar with the firm.

The Rec Warehouse story began in 1974, when it was founded by Don and Gary Doebler in a suburb of Buffalo, N.Y. It  expanded across the United States with a series of retail stores, which were known throughout the country — particularly on the East Coast —  for offering  pool and patio products at low cost. Along the way, Rec Warehouse acquired the Leisure Bay and Dream Maker brands, both of which were known for producing lower-cost hot tubs.

Though vacuum-molded spas will no longer be manufactured under the Leisure Bay brand, sources in contact with the firm have stated that Dream Maker will produce rotomold spas.

While vacuum-molded spas are made by heating and molding a sheet of acrylic, rotomold hot tubs are created by melting plastic beads in a spinning chamber, then allowing the plastic to cool, and removing the resulting shape. These units are typically produced and sold at lower cost than vacuum-molded models.

Rec Warehouse continues to sell a variety of products through multibrand retail stores. The company also is taking on some import business, according to retailers in touch with its representative network.

“From what I understand, what is now on their [warehouse] floor is mainly spas made by another company,” Rothschild said. “They’re bringing them in, last I heard, from Canada.”

The small, regional business was based in Anderson, Calif., about 100 miles north of Sacramento.

“They were a great company to deal with, and their product was top notch,” said Warren Kayser, owner of Warren’s Expert Spa Repair in Chico, Calif., a Phoenix dealer for more than 12 years. “I’m really sorry to hear they’re going away.”

While the company has not formally announced the closing, and was not answering calls at press time, sources close to the leadership at Phoenix have confirmed that the shutdown is official.

The manufacturer now is working to ensure that customers who still have a year or two left on their warranty will remain covered, according to Phoenix dealers.

“They’re being very professional about it,” said Khasha Mekanik, owner of Black Pine Spas in Lynnwood, Wash., a former Phoenix dealer who continues to perform warranty work on its products.

Mekanik explained that Phoenix staff has put his company in touch with the original equipment manufacturers that provided parts to Phoenix, so he and his team can maintain coverage for those customers who still have a few years left on their warranties. “In terms of taking care of loose ends, I think they’re handling it the right way,” he said.

Phoenix was founded by husband-and-wife team Rob and Pam King in 1983. With Rob as president and Pam working as CFO, the company remained family-owned and operated as it expanded its network of dealers, mostly in the Pacific Northwest.

“I really liked the fact that they were local, and oriented toward local dealers,” said Chris Blackburn, owner of Mountain Pool & Spa in Willow Creek, Calif. “It only took a few hours’ driving for me to get out to their offices and talk with them in person.”

Blackburn adds that Phoenix geared its sales policies toward small dealers like him: “They didn’t have any purchase minimums, so I could buy as many or as few spas as I wanted from them.”

Though most major hot tub manufacturers have stayed afloat through the current recession, many smaller spa companies were hit particularly hard last year.

“Quite a few [spa] manufacturers and retailers have closed their doors,” said Sony Banga, vice president of sales at Strong Pools and Spas in Northumberland, Pa. “I think it’s going to take some time for us to bounce back.”