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2014 Summer Outlook: Heat, high winds and hurricanes

BY CSA STAFF

By Kevin Smith, VP of onshore corporate services for ImpactWeather

According to Forrester Research, weather is the leading cause of business disruptions1. From commodity demands and supply chain interruptions to community assistance, retailers know the power that severe weather has over their economic profits and losses.

Surprisingly, many retailers do not have a business continuity plan in place to combat these threats. Business Continuity Institute reports that 70% of businesses that experience a disruption of more than three days will fail, but only 48% of businesses have a business continuity program in place. As Tropical Storm Arthur picks up speed along the East Coast, it reminds us that now is the time for retailers to implement a severe weather response plan.

Monitoring Mother Nature

During the summer, a southern fast food chain needs external temperature readings to establish proper bun baking procedures. A national home improvements chain monitors tropical developments closely to order extra supplies for its coastal stores, such as generators and plywood. A popular American retailer tracks wind speeds to protect its locations from lawsuits due to loose carts bumping into vehicles. These are just a few examples of how weather affects retailers nationwide.

A different type of summer weather threat will present itself this year as El Niño builds momentum in the Pacific Ocean, which could dump heavy rain on the Pacific Northwest and suppress the Atlantic Ocean’s hurricane development. There are reports that El Niño will peak in late fall or early winter, however, it continues to gain strength through the summer months. While hurricanes may not be as intense, they will develop closer to the coast, threatening stores in their path.

In addition to tropical storms, retailers will also feel the heat with temperatures up to three degrees above normal along the West Coast and southeastern United States. These types of extreme temperatures strain power grids, in turn causing rolling blackouts and shutting down commerce for any locations without back-up generators.

Wet weather will challenge businesses in the Midwest, with a higher than normal risk for severe storms producing large hail, tornadoes and flash floods. Even though a location may not be directly impacted by the storm, its supply chain or vendors could be affected. If a thunderstorm wipes out a manufacturing facility or crop field, this reduces the supply to retailers, thus increasing prices for consumers. This recently happened when the U.S. suffered a major lime shortage due to heavy rains damaging much of Mexico’s lime crop. At the peak of the shortage, a 40-pound box of limes increased by $100.

Timing is Everything

Retailers ultimately want to be the last to close and the first to open, but this type of strategic timing is challenging. To accomplish this goal and keep employees safe this hurricane season, retailers can implement the following three timed-phases.

Phase One: (Four to five days out)
• Determine a shut down timeline: Many times businesses decide on evacuation plans based on when a hurricane makes landfall. This can be dangerous as damaging winds may arrive up to 12 hours before the storm. Recently, many stores have determined shut down based on wind strength. For example, if a location cannot safely operate with winds in excess of 48 mph, they will lock up the store.

• Identify resource needs: Identifying the store’s resources is an opportunity to see what employees, products, equipment and supplies the location has available or needs to address prior to shutdown.

• Inventory supplies and products – Will customers need generators, water or canned food? The sooner a store can order additional supplies, the more likely customers will buy from them instead of their competitors.

• Communicate with key stake holders: Key stake holders are employees, vendors, corporate executives and customers who will be affected by the facility’s delays and/or closures.

Phase Two: (Two to three days out)
• Confirm contact information: Store managers should have each of their employee’s personal contact information to communicate critical updates following a storm.

• Review corporate policies: The management staff should review the corporate policies for paying full-time employees, medical and disability leave and the protocol for storm damage recovery.

• Continue monitoring the storm: This is the time to review a store’s worst-case-scenario to maintain the safety of customers and personnel.

Phase Three: (Less than 48 hours out)
• Facilitate a walkthrough: This is the last chance to board up store fronts, sell important materials to customers and finally cease operations.

• Place vendors on standby: Storm surge, high winds and hurricane-producing tornadoes could damage a facility. Managers should place their clean-up vendors on standby. The sooner a facility returns to full operations, the faster a community can bounce back.

• Evacuate: Remaining personnel and management should evacuate and monitor storm conditions.

Every dollar spent on business preparedness saves $7 in disaster-related economic losses, according to the Houston Area Research Center. Instead of waiting for the next major threat, retailers should be proactive in protecting their locations now. Hurricane Arthur will be out to sea by next week, but Hurricane Bertha could be a menace.

Kevin Smith is VP of onshore corporate services for ImpactWeather, a StormGeo Company, where he directs meteorological operations team. ImpactWeather is a full-time weather department for hundreds of corporations globally, providing site-specific forecasting, monitoring, alerting and business continuity tools that empower clients to make the smartest business decisions when faced with weather-related challenges. Email ImpactWeather at [email protected]

1: Forrester Research, Inc. (Q4, 2011). [151 Global Business Continuity Decision-Makers and Influencers Who Have Had to Invoke a Business Continuity Plan]. Disaster Recovery Journal Business Continuity Preparedness Survey.


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Location drives vacationers’ purchases

BY CSA STAFF

While on summer vacation, nearby location trumps brands for many types of consumer purchases, and mobile devices will be the dominant form of search. A new study conducted by location marketing automation provider Placeable shows that proximity is apparently so important that only 1% of vacationers consider reviews when looking to replace a forgotten item.

In addition, 65% of the travelers surveyed report that they seek restaurants and retail locations within five miles of their current location while on vacation. Seventy-six percent reported that they search for local retailers and 89% look for local restaurants while they are away from home.

Most consumers use mobile devices to find products, services and places while they are away. Placeable reports that more than 85% of consumers search for restaurants and retailers on their mobile device while they are on vacation. Fifty-four percent of travelers postpone researching restaurants until they are already on vacation.

“Enterprise brands must optimize themselves locally to capture vacationers searching for non-brand products, services and places,” said Ari Kaufman, CEO of Placeable. “Travelers are increasingly dependent on their mobile devices while on vacation. Based on vacationer preference towards proximity rather than brand, accurate location data and optimized web sites are paramount. Enterprise advertisers must leverage web and mobile locators with local landing pages to capture vacationers that are searching for the closest business.”

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CVS unveils healthy snacks brand

BY CSA STAFF

CVS has announced a chain-wide effort to make it easier for customers to make health-conscious decisions when shopping for food and snacks with the launch of Gold Emblem Abound.

To view a video about the new program, click here.

Rolling out immediately, the new brand of snack products includes more than 40 items that are free from artificial flavors and preservatives.

"We are excited and very proud to introduce the Gold Emblem Abound brand of healthier snacks and grocery items to our customers. We developed the line to taste great and help people on their path to better health," stated George Coleman, VP merchandising, store brands and quality assurance, CVS. "We are confident that our customers will love the products as much as we do."

Gold Emblem Abound offers customers a range of snacks including, snack bars, trail mixes, dried fruit, popcorn and rice chips. Each product in the line is free of artificial flavors and preservatives and contains no trans fats. In addition, Gold Emblem Abound includes products that are gluten-free certified, sodium-free, cholesterol-free and contain sources of protein, fiber, omega-3s, probiotic cultures and potassium.

Nutritional benefits are clearly identified on the bright green packaging. Prices range from $2.19 to $10.99.

In addition to the new product line, CVS also is kicking-off an in-store tagging program called Fit Choices, which takes the guesswork out of finding healthier options throughout the consumables department. The new Fit Choices tags guide shoppers in their selection of edible products and allow customers to find items that suit their individual dietary needs, focused around four categories: "Heart Healthy," "Sugar Free," "Gluten Free" and "Organic."

Store items that meet strict nutritional guidelines will be marked on-shelf with one of the four Fit Choices tags. Products tagged as "rganic" will contain at least 95% organically-produced ingredients and carry the USDA Organic seal on packaging, while items low in saturated fat and cholesterol will be listed as "Heart Healthy," as these items may reduce the risk of heart disease. Brightly colored signage highlights the ease of making healthier food choices at CVS drugstores nationwide, and allows shoppers to select the appropriate item without having to decipher complex labels.

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