'Wrong' weather can foul up retailers' sales

LONE TREE, Colo. -- Wicked winter storms closed the Park Meadows mall here for two painfully long days the week before Christmas last year.

Meanwhile, until cooler weather settled in this week, temperatures in the 60s and 70s this fall had consumers in this fitness-minded Denver suburb hiking and biking, not shopping for winter wear.

Weather can sure put a damper on retail.

Few months pass without at least one retailer blaming Mother Nature for what ails its stores. But while it can seem like a lame excuse, the fact is that weather can play havoc with a retailer's ability to know how much seasonal clothing to offer and when to display it.

Consumers are notorious for avoiding cold-weather clothing until it's, well, actually cold. And it's difficult to get them into the mood to buy warm-weather clothes when they have to scrape ice from the windshield before driving to the mall.

Last December was the warmest since 1957 and the balmiest ever recorded in the Northeast, according to the National Climatic Data Center. That helped sink sales at retailers ranging from Ann Taylor ann and Talbots to Wal-Mart wmt. Temperatures often topped 80 degrees late this September, sending many retailers' sales plummeting again. Continued warm weather last month helped make it the slowest October for retail sales growth in 12 years, according to the International Council of Shopping Centers.

As retailers head into an expected slow holiday season, weather is weighing heavily on their minds again. If consumers aren't motivated to buy cold-weather clothing, retailers are forced to slash prices. When that doesn't work, the stores often wind up sending the goods to off-price outlets, which already are reporting near-record inventories of coats and sweaters.

"I truly believe retailers are impacted by the weather as much as farmers," says Paul Walsh, chief strategy officer of Storm Exchange, a weather-risk-management company.

Even if cold weather returns soon after the warm, as it did in mid-January 2007, some stores move out the winter wear to make room for spring and summer apparel. Then they can get hit again, as they did this past spring. With a very cold Easter and April, "All of those spring items stayed on the shelves," says Walsh, a former meteorologist.

Retail analyst Jennifer Black says even though cold weather prompts people to buy winter wear, and storms can keep them from shopping altogether, "Product is No. 1." She notes that Nordstrom jwn, which withstands economic downturns better than most retailers, "has never blamed the weather. I suppose if there was a hurricane or fires, that would be mentioned, but that is not the same thing.

"If the product is compelling enough, people will seek out the retailer, whether online or in the stores," she says.

Stores jump the gun on seasonal clothes

Some consumers wish stores would sell clothes closer to the season they're intended for, so they're not left empty-handed when searching for shorts in July — or even September. "Retailers have collectively gone a little overboard with having merchandise out so far ahead of the season," says Mike Koehs of Shelby Township, Mich. "There are times when I would appreciate actually being able to buy fall clothes in the fall without only being able to choose from the items that didn't sell out in May."

It's often hard for consumers to psychologically make the shift to a new season, and lingering hot weather makes it even harder, says Wally Brewster, senior vice president of marketing at General Growth Properties, which owns Park Meadows and about 200 other malls in the USA.

"Consumers want to hold onto the summer as long as they can," Brewster says. "We see sales spikes as soon as cold weather spikes."

Conventional wisdom says you can't do much about the weather, but most retailers and a growing group of consultants are trying their darnedest to predict and plan for it.

Among the solutions being tried:

•Displaying merchandise closer to its season. "We are the land of plenty, so people don't have to plan to buy things," Walsh says. "They buy it when they need it."

In the last six years, many Target tgt stores have gone from displaying winter wear in September to waiting until November, says Michael Alexin, vice president of apparel design and development. Alexin says Target is "continually planning for the turn of every season" so it has what it thinks consumers will want. "However, our plans need to remain flexible so we're prepared when the weather hits 60 degrees in Minnesota in November," he says.

Dawn Masters, who works across from Park Meadows mall here in Colorado, is one of those shoppers who gives retailers fits. "Who wants to buy a winter coat in September or October out here, even in November?" Masters said Monday. "It's supposed to be 75 degrees today!"

Masters says she often gets good deals on winter wear for her family starting in late March as ski season winds down: "Whatever you had last year will usually work for a little while longer while waiting for the sales, which everyone knows are coming."

•Offering more all-season apparel. Ann Taylor isn't taking chances with the weather this year. It's featuring lighter-weight fabrics that work well in all seasons, says spokeswoman Maria Sceppaguercio. She says it's an alternative to the "chunky wool" sweaters that sat on Ann Taylor Loft shelves during the warm early winter last year.

"They don't want to have another winter like the last one," Black says of Ann Taylor. "How many sweaters does anyone really need?"

Alexin says consumers "love layering, because it creates a seasonless wardrobe."

Still, it's not the solution to all problems. Even with the lighter-weight offerings, Sceppaguercio notes that sales were slow in September and even worse in October. "Because it was so warm, (customers) didn't need anything," she says. "With the onset of more seasonal weather, (customers) are back and buying more wardrobe essentials." Walsh says nearly 80% of the fluctuations in Ann Taylor's September sales in the past six years can be explained by changing temperatures.

Talbots, which also owns J. Jill, has been similarly hurt by warmer temperatures, Walsh says. He says apparel specialty stores are hardest hit by weather because they don't have other merchandise to offset slow seasonal clothing sales. Phil Kowalczyk, chief operating officer for parent company Talbots, says J. Jill is now offering lighter-weight layers and "stylish and practical alternatives to that heavy coat or parka."

"The issue of changing temperatures isn't just related to 'warming trends,' but also to the controlled environment (the customer) lives in year-round," says Kowalczyk.

Dana Miller lives in Los Angeles and especially appreciates "lighter, more all-weather wear."

"As much as I love fall and winter clothes, aside from it being freezing in my office, there's really no need to bundle up most of the year," Miller says. "My shopping patterns don't really coincide with the seasons."

Kohl's had sweaters with three-quarter-length sleeves in fall colors last month, says Sara Winters of Reynoldsburg, Ohio. It was "a great fall selection this year for those days that are between 60 and 80 degrees. When I pulled out my winter clothes to pack away the summer items, I found that most of my sweaters had some wool content or were just too hot to wear in the fall."

•Shortening inventory lead times. Retailers who have hundreds, rather than thousands, of stores can manage their inventories on more of a just-in-time basis, which allows for last-minute adjustments due to weather, says Ken Nisch, chairman of JGA, a retail brand and design consulting firm. Stores such as the Midwestern young women's apparel retailer Maurices, owned by Dress Barn dbrn, and Zara, have more direct control of their manufacturing plants and are better positioned to "hedge their merchandise" to reflect temperatures, Nisch says. Maurices, for example, defines its stores by climate zone and buys and allocates merchandise differently based on trends and historical weather patterns in those areas.

"They are able to mitigate problems with markdowns by not offering merchandise that isn't weather appropriate," Nisch says. "But the challenge is when you have 3,000 to 4,000 stores, because the bigger you get, the less able you are to be reactive."

Retailers may have to go back to the future

Nisch says the "retail company of the future" may end up being more like stores of the past: broken down by regions rather than demographics, so they're more in tune with the temperatures and tastes in different areas.

Online shoppers react the same to weather as do shoppers who go to bricks-and-mortar stores, says Walmart.com CEO Raul Vasquez. They wait for it to get chilly to start buying cool-weather clothing.

"As a retailer, you like to see the weather snap," he says. In the first two weeks of November, for example, sales of warmer clothing on Walmart.com tripled.

Stephanie Jackson, the marketing manager at Park Meadows, says the first cold brings out shoppers for apparel, because, "People are ready to go to the next season." But it also brings out home-goods shoppers, because people start "nesting."

"They look for things like gravy boats and decorating elements that warm up the house," she says.

But a cold snap and a store-closing winter storm are different things.

"Most retailers hope for cold weather, and like snow," Walsh says. "But there's such a thing as too much of a good thing, because if you lose a weekend or two other days, you aren't necessarily going to get them back."

Contributing: Mindy Fetterman, Doyle Rice