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The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast
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The Impact of Weather on Retail Sales in Spring 2009 and the 2009 Hurricane Season Forecast

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Investor presentation given on March 24, 2009 to Global Hunter Securities clients. Primer on the influence of weather on consumer spending and retail sales and the outlook for the balance of spring …

Investor presentation given on March 24, 2009 to Global Hunter Securities clients. Primer on the influence of weather on consumer spending and retail sales and the outlook for the balance of spring 2009 and an initial outlook at the 2009 Hurricane season.

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Transcript

  • 1. Paul
E.
Walsh
 Managing
Principal


 G2
Weather
Intelligence,
LLC
 ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 2. G2
Weather
Intelligence
LLC
 Helping
companies
make
more
 money
by
systemaBcally
planning
 for
the
influence
of
weather
on
 consumers
and
business
 ©
2008
G2
Weather
Intelligence,
LLC.

All

Rights
Reserved
 ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 3. Weather’s
Impact
on
Consumers
 •  Weather
is
a
fundamental
yet
 oHen
overlooked
driver
of
 consumer
demand
 –  ParBcularly
during
the
high
 margin
spring
transiBon
season
 •  Results
in
unexpected
upside/ downside
volaBlity
in
same‐store
 sales
results
 •  Easier
to
measure
and
predict
than
almost
any
other
influence
 on
consumer
acBvity
 ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 4. Retail
Segment
Exposure
in
Spring

 Off‐the‐Mall
Specialty
Retail
 •  Mall‐based
Specialty
Retail
 •  Home
Centers
 •  Mass
Merchants/Club
Stores
 •  Department
Stores
 •  Restaurants/C‐Stores
 •  ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 5. Retail
Segment
Exposure
in
Spring

 •  ConsideraBons
 –  Merchandise
 Assortment
 –  Geography
 –  Fiscal
calendar
 –  Prior
month
 –  ExecuBon
skills
 ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 6. High
Impact
Weather
Parameters
 Temperature
 •  Primary
“strategic”
demand
indicator
 –  Departures
from
normal
and
prior
year
are
key
 –  Impacts
large
populaBon
centers
and
geographies
 –  Correlates
strongly
to
sales
of
seasonal
merchandise
 –  Predictable
at
seasonal
(year
ahead)
Bme
scales
 –  PrecipitaBon/Snow
 •  Weekend,
dayBme
events
the
biggest
impact
 –  Traffic
hindrance
primarily
 –  High
impact
but
not
as
widespread
as
the
impact
of
temperature
 –  ImpacZul
events
are
not
as
predictable
at
longer
range
Bme
scales
 –  Hurricanes
 •  –  Traffic
and
demand
generator
 –  Biggest
and
most
widespread
impact
the
result
of
hurricane
predicBons
vice
landfall
 –  Media
coverage
ahead
of
storms
results
in
a
net
plus
for
Home
Centers
(HD/LOW),
 Mass
(WMT),
and
grocers;
results
in
a
net
negaBve
for
mall‐based
retailers


 ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 7. Weather
Influence
March
Sales
 Example
of
the
influence
 •  of
temperature
on
retail
 sales
 Old
Navy
same
store
 •  sales
change
compared
 to
the
change
in
a
 naBonally
weighted

 Cooling
Degree
Index
 (weather
source:

NOAA)
 Increased
cooling
 •  demand
correlates
to
 increased
demand
for
 spring
apparel
 –  ~40%
correlaBon

 ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 8. Weather
Influence
on
April
Sales
 Example
of
the
influence
 •  of
temperature
on
retail
 sales
in
April
 NaBonal
temperature
 •  change
against
the
 average
comp
store
 sales
of
a
basket
of

53
 retailers
(source:

Global
 Hunter
SecuriBes
and
 NOAA)
 ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 9. March
2009
(as
of
3/18)
 Courtesy
of
AccuWeather
 ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 10. April
2009
Forecast
 Courtesy
of
AccuWeather
 ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 11. May
2009
Forecast
 Courtesy
of
AccuWeather
 ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 12. ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 13. ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 14. ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 15. ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 16. 2009
IniBal
Hurricane
Outlook
Consensus
 Consensus
outlook
from
all
 private
forecasters:
 • 
Below
the
10‐year
average
 and
2008
 • 

Above
the
long
term
 average
 ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 17. Summary
ExpectaBon


 •  Generally
favorable
weather
against
a
very
difficult
2008
 spring
season
 •  Befer
physical
climate
overlapping
an
improving
consumer
 environment
 –  Obama
SBmulus
(intangible
and
tangible
benefits)
 –  Lower
year‐over‐year
gas
prices
 –  Pent
up
demand
following
the
spending
slowdown
during
 the
“cold”
winter
of
2008/9

 •  Weather
a
net
posiBve
in
Spring
2009
 –  Stars
aligned
for
stronger
than
expected
retail
sales
through
May
2009
 ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC

  • 18. Paul
Walsh,
G2
Weather
Intelligence
LLC
 Paul.Walsh@G2Weather.com
 Direct:



+1.917.463.4238
 Mobile:

+1.610.246.0623
 Blog/Website:

www.G2Weather.com
 “Changing
the
 way
business
 thinks
about
 the
weather”
 ©
Copyright
2009
All
Rights
Reserved,
G2
Weather
Intelligence,
LLC


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