IT ALL EVENS OUT IN THE END!

“Sometimes the weather hurts me, sometimes the weather helps me.” While this adage often rings true, it does not mean that positive and negative weather simply even out over the course of a selling season, fiscal quarter or even a year. The timing, location, strength and duration of favorable or unfavorable weather makes a big difference. Consider the following examples:

PROFITABILITY: A negative 25-percent weather-driven demand impact on winter coats in November is not offset by a 25-percent weather-based demand boost in January. Further, there is a lot more profit in a November sale compared with the end of the season when merchandise is marked down heavily for clearance. 

LOST SALES: When a winter storm keeps people at home, some sales are never made up. Yes, the weekly grocery run is often made a day or two later, but if someone doesn’t stop for a cup of coffee on the way to work because a snowstorm keeps them at home, they don’t buy two coffees the next morning to “make up for it.” The same is true for other categories or for impulse buys.

TIMING: Warmer-than-normal temperatures in the early spring can be great for do-it-yourself retailers as consumers head to stores for live plants and other lawn and garden items. However, if these retailers have a less favorable start to the season, improved weather in May or June will not have the same effect. For many consumers, the optimal “window of time” has passed for certain outdoor projects (or other seasonal items like apparel or décor). DIY projects will be downsized or skipped altogether as the calendar shifts the consumer’s attention to other priorities and activities. Unlike Newton’s third law of motion, there is not really “an equal and opposite reaction” when it comes to weather and its business ramifications.

 

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