Retailers shouldn’t be at the mercy of shifts in weather if they plan properly, says David Wild
As a nation we are preoccupied with the weather. Some industries, like farming, never, seem to have the right sort. Retailers too could be guilty of more often dwelling on the pain, rather than the gain, that weather patterns bring.
The retail headlines are full of weather related stories often highlighting the negative impact on our industry. ‘Sales suffer sharp fall on snowy weather’ was a common conclusion following last year’s cold winter. The press clippings also show there is some balance and that the elements bring pros, for instance ‘Winter weather boosts fashion sales’ also featured last autumn.
As retailers, the link between the seasons and sales is ingrained. Our promotional calendars are based on our customers’ needs across the year, as different levels of sunshine and rain trigger changing behaviour. In the spring as the weather warms up we are ready to sell outdoor products like bikes and tents. Then in the autumn when it’s wetter and colder we are well stocked with wiper blades and de-icer.
Of course, abnormal weather can disrupt the usual patterns and produce sudden or unpredicted peaks and troughs in demand. Really hot temperatures means more sun blocker will be needed, while prolonged periods of rain apparently stimulate DVD sales, as people spend more time indoors. Our reserve-and-collect service is particularly relevant in such instances as it allows customers to locate items online and pick them up immediately.
Severe weather can also change demand by physically stopping people from going shopping; something that retailers in Scotland reported last winter. The same is true at the other end of the temperature scale. A recent survey recorded that 50% of families questioned said they shop less in very hot weather.
One interesting counter trend is in online sales. In good weather people are outdoors and internet sales drop. By contrast on wet days they spend more time inside browsing, which boosts web sales. The growth of smartphone internet access may change this, as customers shop on the move.
Various studies have tried precisely to map sales metrics to changes in temperature, rainfall and sunshine. Ice cream manufacturers know the extra quantity of product they will sell for every degree hotter it gets. While another study in the US demonstrated a clear correlation between falling temperature and car battery sales.
The trends are so important that most large retailers employ analysts to factor weather-related demand into the supply chain and adjust store orders accordingly. Interestingly the media often use store data to explain weather effects. Last winter we were inundated with calls asking how much deicer, screen wash and scrapers had sold.
But it’s important we work with the weather, rather than let it run our businesses. One of Walmart’s great philosophies is that it never discusses or blames it in relation to any sales issue. If the weather has affected business then it’s down to bad planning.
As I write the country is gripped by freezing temperatures and snow, but whatever the weather our job is to keep the stores stocked so customers can buy what they need without interruption.
David Wild is chief executive of Halfords