Cold Weather Puts a Chill on Retail
By: Andrew Asch
Southern California has been cold and rainy this winter, and some have described the business of selling beach-inspired and summer clothing as a washout.
Bob Abdel, co-owner of the prominent surf boutique Jack’s Surfboards in Huntington Beach, Calif., said rain and cold weather have made summer clothing–focused businesses like his suffer.
“When it rains this much, no one comes to the beach,” he said. “There’s nothing that we can do. It’s Mother Nature. I wish the sun would come to us,” he said.
February was particularly rainy in Southern California with more than five inches of rain coming down over much of the area and temperatures never rising above 69 degrees. The following months were also cool and cloudy.
Bigger retailers such as Tilly’s Inc., headquartered in Irvine, Calif., said poor weather hurt its Memorial Day–weekend performance with same-store sales declining 6.6 percent. Sales in California, where 95 of Tilly’s 228 stores are located, were particularly down, the company said.
Cold, rainy weather also hurt retailers who do not specifically cater to the beach crowd. During a conference call with analysts, Art Peck, chief executive officer and president of Gap Inc., said the weather in February waterlogged some sales. “As you know, this was one of the coldest, wettest quarters in memory, and while traffic and sales trends improved as we moved through March and April, it was difficult to overcome the extremely slow business that we and others encountered in February,” Peck said.
The San Francisco company reported on May 30 that net sales for the first quarter ending May 4 were down 2 percent to $3.7 billion compared to $3.78 billion during the same period last year.
Planalytics, Inc., a weather-business intelligence group based in the Philadelphia area, said that cold temperatures made most Southern Californians run for the coat closet to cover up. Southern California retailers selling beach and summer clothes lost $54 million in sales in May because of cooler conditions.
The group’s research found that sales of shorts in Los Angeles were down 4 percent in May compared to the same period a year ago. The cool temperatures also put a damper on beach-style clothing. Sales of polo shirts in May were down 3 percent compared to last year.
Some retailers and brands were able to offset the cold weather by selling to travelers visiting sunny spots that weren’t as cold as coastal Southern California.
LASC in West Hollywood, Calif., does big business in swimwear and shorts. Many of the retailer’s customers spend the weekends in the nearby desert resort town of Palm Springs, where temperatures were in the mid-80s in April and May, said LASC co-founder Don Zuidema.
Selling clothes to party at Palm Springs–area festivals such as the Coachella Valley Music and Arts Festival and Stagecoach Festival also help LASC throughout the year.
“These events and the great weather [in Palm Springs] have been helpful to keep our business relatively strong,” Zuidema said.
It’s a different story for LASC customers who stay in West Hollywood or hang out at the beach. “Business has softened in town. It’s sort of flat,” Zuidema said.
Brands such as Outerknown have reacted to cool weather by broadening their categories, said John Moore of the Culver City, Calif., brand, which has been focusing on manufacturing clothes you can layer.
“The fleece- and blanket-shirt programs on both sides [men’s and women’s categories] of our brand are really strong. It is the perfect layer for the recent weather patterns,” he said.
Scott Bernhardt, Planalytics president, said that Southern California’s normal run of pleasant, warm weather has spoiled the area’s customers. “People are much more sensitive to small changes in weather,” he said of Los Angeles shoppers. “The tiniest weather change makes a huge difference in retail.”
To avoid the chill by changes in weather, Bernhardt recommended that retailers add forecasting to their set of skills. “Watch the weather,” he said. “Understand that weather matters. It’s not something that can be ignored.”