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How Did the Weather Impact November Sales for Stores and Restaurants?

fall shopping

 

November is typically the start of the holiday shopping season. There are many factors that affect when shoppers make purchases and what they buy, but there is no greater variable than the weather.

The eastern third of the United States saw cooler year-on-year temperatures, which drove demand and favorable comps for winter apparel, heaters, and other seasonal products. In fact, according to Planalytics, apparel retailers saw an increase of $267 million in sales for the month of November in the eastern third of the country. Shoppers in the Northeast, Southeast, and the Great Lakes area purchased fleece, scarves, boots, and outerwear.

Conversely, residents of the Rockies, Plains, and the West Coast experienced much warmer temperatures than normal. Because of this, many decided to delay purchasing seasonal apparel and other winter products.

Below are several weather-driven demand calculations for example product categories comparing November 2016 to November 2015:

Category Impacts:

  • Women’s Boots: +17% Knoxville,  +12% Hartford, -19% Denver
  • Fleece+8% Philadelphia, +7% Atlanta, -13% Dallas
  • Heaters : +5% Cleveland, -39% Salt Lake City, -18% Omaha

 

scarvesfleece

As you can see from these analytics, favorability for seasonal categories in the Northeast, Mid-Atlantic, and Mid-West were more positive than those in the Plains or Rockies. This was no coincidence. Favorable weather conditions in one part of the country and unfavorable conditions in the other influenced how and what customers bought.

Luckily for retailers and restaurants, precipitation did not have a negative impact on traffic and sales. November 2016 was considerably drier than November 2015 which aided foot traffic.  Restaurants in particular saw a positive$278 million weather impact.

Want to learn more about weather impact and how you can deweatherize your business? Contact a Planalytics representative today!

 

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Previewing the 2016 Holiday Shopping Season

shopping cart

 

We’re only a little over a week away from Black Friday and the official start of the holiday shopping season. Apparel-focused retailers who were hurt by the incredibly warm temperatures last November and December in many parts of the country are eager to know if this holiday season will prove more favorable.

There are many questions retailers might have:

Will the weather drive shopping traffic?

Where will there be weather-related opportunities?

Will it get cold enough to trigger sales for a specific seasonal item?

These are just some of the questions that we will be looking at now and in the upcoming weeks as we enter the prime weeks of the holiday shopping season. Planalytics combines weather data in business and historic sales data to isolate the weather and determine its impacts on sales based on market, sector, and category.

 

What a Difference a Year Makes

 

shopping dad

 

Thanksgiving Day was the warmest since 2012 and wettest since 2010. The Black Friday weekend was the warmest since 2012 and the wettest since 2000. Last year, temperatures were well above 70 degrees in the East on Christmas Eve. This was a weather trend seen on the East Coast throughout the holiday shopping season.

This year, Black Friday weekend will feature colder temperatures versus last year in the East, which will support seasonal demand. Warmer temperatures are expected in the West. Retailers will have to identify the areas of opportunity.

Below are weather-driven demand insights for several product categories for November vs. last year:

Soup: -15% WDD IN Seattle

Firewood: -18% WDD in Denver

Long Sleeve Shirts: -5% WDD in Los Angeles

Heaters: +14% WDD in New York

Rainwear: +35% WDD in Miami

Boots: +6% WDD in Montreal

In December, many retailers should see favorable comps for seasonal categories as temperatures are expected to be colder than last year. If you remember, December 2015 was the warmest retail December since 1960. Apparel stores should see a positive impact of $275 million while home centers will see a negative impact of $876 million. In regard to various categories, here are Weather-Driven Demand insights for December 2016:

+33% WDD for Snow Removal

+20% WDD for Firewood

+9% WDD for Hats & Gloves

+5% WDD for Automotive Batteries

As you can see, seasonal categories are expected to see stronger sales driven by colder temperatures in the East. However, the weather impact for specific sectors and categories in December will depend on the region and week. It is best to speak with your Planalytics representative about weather-driven demand insights specific to your business.

Overall, sales growth is expected this holiday shopping season as temperatures normalize in much of the country that saw extreme warmth last year. Understanding weather’s impact and how it affects your business is the first step to managing its volatility.

 

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Why Retailers Should See a Boom in Sales This Holiday Season

shopp2

 

Retailers should expect a stronger holiday shopping season this year. Last month, the National Retail Federation (NRF) estimated holiday retail sales would rise 3.6% in November and December. The NRF highlighted stronger consumer confidence and the expectation that the weather will be cooler to drive sales of traditional seasonal goods.

 

This is certainly music to the ears of retailers who were burned by last year’s unseasonably warm weather. The warm holiday shopping season left cold weather goods and products like scarves and boots, on the shelves, forcing retailers to heavily discount those items. Many retailers who didn’t deweatherize their demand planning experienced the heaviest losses.

 

How Weather-Driven Demand Measures Weather’s Impacts the Holiday Shopping Season

 

Icicles on a fence

 

The NRF’s estimate that holiday retail sales will improve this year from last is aligned with Planalytics’ winter weather outlook. Retailers can expect more favorable comps versus last year in the East and other parts of the country as the temperatures trend back towards normal. This will create positive weather-driven demand for many cold weather categories, including jackets, winter hats, snow boots, and more.

 

The weather is one of the largest external variables impacting a consumer focused business. Last year, the unseasonably warm winter caused consumers to throw on their shorts and make other purchases throughout the holiday shopping season. This year, we see a different scenario where the weather will positively influence cold weather products sales in many areas of the country.

 

Why Deweatherization Is Important

 

If retailers were to plan based off of last year’s sales data alone, it would result in a skewed plan for the upcoming season. This is because the weather only repeats itself fifteen to twenty percent of the time. Eighty percent of the time, a retailer’s demand planning would be considerably off if it used last year’s numbers alone.

 

Weather analytics is the best way to neutralize the effects of the weather by market, by region, and by time.

 

Although weather trends so far in the fall have been relatively warm, things will change as we head into the holiday shopping season. Retailers can expect colder weather to drive sales for seasonal products. Contact us today to learn more about deweatherization and how Planalytics can help you mitigate the effects of the weather on sales.

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Plan Ahead for the Upcoming Holiday Shopping Season by Measuring The Business Weather Impact

santa shopping 2

 

Now that we are in the middle of September, businesses are looking ahead to the very important fall season and holiday shopping period. There’s no question that most retailers will be looking for more seasonal weather than last year. You will probably recall that November and December were unseasonably warm in many parts of the country. While this may have been great for golfers, retailers (especially apparel and department store chains) saw diminished sales.

 

Planalytics was interviewed by CNBC at the beginning of this year to recap the sluggish holiday shopping season. Specialty apparel stores alone lost $572 million in November and December due to the weather. Although the colder weather eventually came, it wasn’t soon enough. Luckily, weather conditions are rarely similar year-over-year. This year Planalytics expects to see strong opportunities throughout the holiday season.

 

Managing Weather-Demand Impact Using Analytics

 

Retailers consistently face issues planning for the upcoming season, especially due to weather volatility. Retailers that deweatherize their plans and leverage weather-driven demand analyticswill see many sales opportunities going into the holiday season. But how many businesses have actually quantified the weather impact and made the necessary adjustments to their sales forecasts? This is where Planalytics’ business intelligence services can help. Weather analytics allows companies to gain a better understanding of customer demand shifts based on the weather.

 

Planalytics provides weather intelligence to help organizations like yours quantify the effects and implications the weather has on a business. Planalytics offers both transaction-level and product-level analytics to give organizations a full picture of weather’s impacts.

 

With weather analytics, organizations can more accurately track financial performance, report weather-adjusted sales, optimize inventory management and allocation, and streamline operations to name a few. They can plan for future demand, adjust sales based off of weather volatility, and take advantage of opportunities and minimize losses during down periods.

weather impact baked

 

Are you looking to weatherize your business? Planalytics offers various Big Data weather services to help businesses gain a better perspective of their weather-driven impact. As last year showed, retailers, restaurants, and other businesses cannot afford to take a passive approach to weather volatility and customer demand shifts. Contact us today to learn more about how your business can prepare for the upcoming Holiday Season.

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An Outlook of the Back-to-School Shopping Season: Now until October

picture suppleis

 

Labor Day is just around the corner, which means that Back-to-School shopping is in high gear. All across North America, parents and their children are heading out to department, apparel, office supply, and discount stores to stock up on clothing, school supplies, and more. The upcoming weeks will provide a number of opportunities for retailers in these sectors to maximize on demand. And as always, the weather will represent a major external challenge for retailers which will determine when and how consumers shop this Back-to-School Season.

Planalytics recently partnered with Fung Global Retail & Technology for their Back-to-School Outlook webcast to provide information on what retailers can expect throughout the season. You can find a complete recording of the webcast here, but below are several key points retailers should be aware of in order to take advantage of key sales opportunities.

Back to School Sales Will Rise in the Early Parts of the Season: Fung Global Retail & Technology expects early back-to-school sales in July & August to rise 2%-3% this year, compared to 0.4% last year. This is slightly below the average increase of 3.8%.

Overall Back-to-School/Back-to-College Spending to Rise Big: The National Retail Federation estimates spending to rise 11.5% in 2016 to $75.8 billion. The average Back-to-School family is expected to spend as much as 7% more than last year. Interestingly enough, college families plan to spend slightly more than 1%  less. However, total college spending will rise 12.5% because of the increase in Back-to-College consumers.  In total, 87% of parents intend to spend the same or more compared to last year.

The Major Sales Drivers Will Be Apparel and School Supplies: Clothing and accessories, the largest category, is expected to represent 34.9% of total Back-to-School sales. School supplies are projected to represent 16.0% of total Back-to-School sales. Retailers in these spaces should expect to see heavy sales in the upcoming months directly related to Back-to-School consumer demand.

How Could the Weather Impact Back-to-School Sales?

The months of August, September, and October are very weather-sensitive. Cooler temperatures in a region could easily influence whether or not consumers decide to pull the trigger on Back-to-School merchandise. Planalytics predicts that the best year-over-year opportunities for fall categories will be in the West. August will be especially warm in the eastern two-thirds of the United States, making sales opportunities slightly more challenging until temperatures cool down.

However, temperatures are expected to become more seasonal in the Northeast after August, providing retailers with a number of opportunities to drive sales for Back-to-School items. The Pacific Northwest and Southeastern part of the United States should trend slightly warmer than normal in September. Overall, cool and dry conditions in September for much of the United States will increase demand for seasonal categories. Although the Back-to-School season will start slower, leveraging weather-driven demand to identify areas of opportunity will help maximize sales for seasonal categories.

For detailed insights specific to your business, and weather-demand opportunities and predictive analytics trends in the fall, please contact us today to speak with a Planalytics representative.

 

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Weather-Adjusted Sales for July

July was the warmest month on record in the world. In the United States, this meant weather’s impact on sales was large. How did weather impact July sales in several key retail industries? We have created the following infographic based off our weather-driven demand analytics to provide you with additional information on the retail environment in July.

new-piktochart_15456767_fe7b6a0c51562d4bc9fd57318893d92fdad6886b

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Warm June Boosts Sales of Seasonal Goods and Increases Participation in Outdoor Activities

June is the first month of the summer, and apparel retailers, hardware stores, restaurants, golf courses, and many other businesses hope for favorable weather to generate big sales. In addition, Father’s Day sales, which reached $14.3 billion this year according to the NRF, are also impacted by the weather. So what did the weather look like in June for the various regions of the country, and what did this mean for apparel retailers, hardware stores, and other businesses looking for big sales to carry over into the rest of summer? Here are several points of note that were published in our June WeatherCall report. You can download the complete report here.

 

It Was a Hot and Dry June

 

June 2016 was one of the warmest on record. The first week of June was the warmest in the United States in more than 55 years boosted by near-record highs in New England and the Pacific. This carried over into the second week of June where St. Louis experienced its warmest temperatures for the week since before 1960. The West North Central Region also trended warmest since 1987. The East South Central region recorded a top 3 warmest second week in June in over 55 years.

 

The third week of June nationally was the second warmest in over 55 years. This was driven by near-record highs in the Mountain and Pacific regions. Finally, the fourth and final week of July was the warmest nationally in three years. LA experienced its warmest temperatures for the week since 1976.  There were a few regions that did experience cooler overall temperatures than in years’ past, but, as a whole, June was very warm when compared to prior years.

 

It was also relatively dry in much of the United States. New England had its driest June since 2007. The East South Central Region was its driest since 2011. The Mid-Atlantic, East North Central, and Mountain regions experienced their lowest precipitation levels since 2012. Major cities in these regions, including New York City, Boston, Cincinnati, St. Louis, and Buffalo all had drier than normal conditions throughout the month of June. Overall, rainfall was the least since 2012.

 

june 2016

 

The weather left no doubt in the minds of consumers about the arrival of summer. They responded in kind by purchasing a variety of seasonal goods. Air conditioner weather driven demand (WDD) was up 33%. Sun care products were up 9%. Shorts were up 5%. In addition, retail traffic was up in several segments, including restaurants, sporting goods, home centers, and more. Not surprisingly, the indoor entertainment industry experienced less foot traffic than in year’s past.

 

Overall, Planalytics’ weather-driven demand analytics calculated a significant weather impact on sales in June 2016 alone compared to the same period last year:

  • Apparel Chains: $249,000,000
  • Hardware & DIY: $65,000,000
  • Restaurants: $554,000,000

 

June 2016 Was a Warm One. That Doesn’t Mean June 2017 Will Be Warm as Well

 

June 2016 saw mostly favorable weather, which helped many businesses see increased sales from consumers taking advantage of the favorable conditions. However, June 2017 could be a completely different story. Weather only repeats itself about 15-20% of the time. Rather than wait and see what happens, businesses do have the opportunity to invest in weather risk management, which can help minimize adverse effects from the weather and maximize on weather-related opportunities. Contact us today to speak with a Planalytics representative and learn more about the benefits of using our weather analytics services.

 

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