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This is How Much Economic Activity was lost Because of the Blizzard

The Washington Post
By:  Sarah Halzack

If you were in the blizzard’s path this weekend, odds are good it caused you to change up your spending habits in some way. In the days before the storm, maybe you went to the grocery store to stock your pantry with milk and bread. And while you were hunkered down during the storm, maybe you ended up cancelling a date night at a restaurant or a trip to the mall.

Those may feel like small changes, but when millions of us make them simultaneously, weather analytics firm Planalytics has calculated it can have a significant economic impact. After studying the timing of the blizzard and the population distribution in its path, Planalytics estimates that some $850 million in economic activity was lost due to the storm, with the largest share, $275 million, in the Washington and Baltimore area.

This is likely unwelcome news to many in a retail industry that is looking to gain fresh momentum after a disappointing holiday season. Still, Kelly Carroll, director of client services at Planalytics, says the effect is likely uneven, with some categories of retail even getting some benefit from the storm.

Home improvement stores, convenience stores and mass merchants, Carroll said, saw at least some tailwind from shoppers stocking up on items such as shovels, flashlights, batteries. This may be why ShopperTrak, a retail analytics firm, found that traffic to brick-and-mortar stores (excluding grocery stores) was up 7.5 percent in the two days leading up to the storm.

Grocery stores, however, likely also got some bump in sales, Planalytics said. After all, maybe you wouldn’t have bought ingredients for beef bourguignon and chocolate chip cookies if you weren’t planning to be stuck in the house for a while.

At Safeway, which has 125 stores in the Washington region, spokesman Craig Muckle said that foot traffic at many locations in the lead-up to the storm was comparable to what stores see right before Thanksgiving or Christmas dinner.

“In a lot of ways, this is a Super Bowl opportunity,” Muckle said, meaning that it’s a chance to net a big win with shoppers.

Jamie Miller, a spokesman for Giant Food, said foot traffic and sales were “exceptional” at its 170 grocieres in the Washington region as people filled their shopping carts to weather the storm.

Meanwhile, in the restaurant category, there’s not really an upside to the inclement weather.

“You’re never going to make up those sales,” Carroll said. “If you’re able to go out Monday night, it’s not like you’re going to buy two dinners to make up for Saturday,” Carroll said.

The blast of winter weather may have given hope to some apparel retailers that they might finally start selling the coats, boots, hats and gloves that they were struggling to unload during an unseasonably warm November and December. Planalytics, however, does not expect the storm will be much help with that.

“If they’ve made it this far without buying a winter coat, they’re just going to wait until next year,” Carroll said. “It’s a pricing decision, not a weather decision.”

To help put in perspective how much business some retailers may have missed out on this weekend, it helps to consider these figures provided by ShopperTrak: Visits to brick-and-mortar stores in the Northeast were down 26 percent from Jan. 22 through Jan. 24 when measured against the comparable weekend last year. The effect was particularly pronounced in the Washington area, with brick-and-mortar visits down 53 percent.

While that’s certainly not news for the retail industry to be happy about, it may not be entirely dire: It’s possible that snowed-in shoppers fired up their tablets and bought online the cardigans and skinny jeans they otherwise would have bought at the store.  And it’s also possible some of those missed in-store sales will simply be diverted to another trip to the mall down the road. We’ll get a clearer idea of how this shakes out as the the mountains of snow start to melt.

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