As powerful Category 4 Hurricane Matthew takes aim at Florida’s coastal region and mulls a path through Georgia and the Carolinas, millions of residents are being warned to evacuate their homes.
Needless to say — and rightfully so — non-necessity retail spending is taking a backseat as those in the path of the storm clamor for hurricane essentials such as nonperishable food items and water.
Still, even as local business owners prioritize their own safety and that of the people in their communities, secondary concerns often center around the short-term and long-term impact that a devastating storm can have on their livelihood.
“The distraction [of a hurricane] causes a lot of change in retail consumption, but not every retailer feels the pain,” explained Marshal Cohen, chief industry analyst at The NPD Group. “Home Depot, Lowe’s, grocery stores and the gasoline business [and similar businesses] surge during these times. But traditional retailer selling general merchandise and products [feel the effect of] people going on hiatus because they’re tuned in [to news broadcasts] trying to figure out when and if the storm is going to hit.”
And, Cohen added, when a storm actually makes landfall, many consumers end up locked down in their homes or are evacuated to another area — further slowing retail traffic in some areas.
“If you’re a local retailer, you certainly feel the pain 100 percent,” Cohen explained. “If you’re a regional retailer, you feel it by about 25 percent. If you’re a national retailer — even if [the storm] is a prolonged three- to four-day event — it might not even represent 5 percent of loss. It all depends on the complexion and nature of what you do.”
For many footwear and apparel sellers that have struggled to eke out a profit during the past 18 months, even a minor lull in business can be detrimental. Not to mention, many fashion firms were looking to the upcoming Columbus Day holiday weekend as the next major shopping catalyst.
“Does the hurricane create an opportunity for loss because it is a holiday weekend? To some degree it does, but today’s retailers will be able to extend their sales or sell online,” Cohen pointed out, adding that e-commerce could represent a viable sales growth opportunity for many companies over the weekend.
“The consumer is going to be taking advantage of the [Columbus Day] sales — retailers in the Southeast region are going to get a huge lift in the online component,” Cohen said.
Either way, Cohen notes, retailers could also use the storm as a means to become more socially responsible and active in their communities.
“One of the best things [retailers] can do is get engaged in the community’s needs,” he said. “We certainly see businesses do it on a broad level but why not take advantage of — if you’re a local merchant — an opportunity to make the community recognize that you’re there for them.”