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Snow's business impact: retail up, restaurants down

Written by Brett Sholtis/York Daily Record | Jan 28, 2016 8:47 AM
York_snow_business_2016.jpg

A group of patrons enjoy drinks outside in Center Square at Miscreation Brewing as a few businesses were open downtown Hanover on Saturday Jan. 23, 2016. (Photo: Shane Dunlap, The Evening Sun)

(Undated) -- A winter storm pounded York County last weekend, dropping as much as 30 inches of snow in some areas and grinding travel to a halt.

The storm likely has caused several billion dollars in damage nationwide, according to a USA Today report. However, its effect on businesses is a bit more subtle, said Chris Christopher, an economist at IHS Inc.

It "has mixed effects on the consumer economy, producing both losers and winners among retailers," Christopher said.

Grocers, gas stations break even

For some sectors, a snowstorm affects when a product is purchased, but doesn't change the amount of product bought, Christopher said.

Groceries are one prime example, he said. With a storm on the way, consumers stock up on food and fill their vehicles with gas. But when the storm ends, all that uneaten food means there may be no need to make a weekly trip to the supermarket.

"Consumers take time to work through their purchases before returning to the grocery store," Christopher said. "Snowbound cars don't use gas. All told, spending on food at home sees only a mild increase."

Because grocers' biggest losses happen when they have no product to sell, they also prepare for storms by increasing orders, said Dennis Curtin, Weis Markets spokesman.

Curtin said that, by last Tuesday, Weis was upping orders for staples like bread, milk and eggs. The supermarket chain also brought in extra employees to stock shelves, run registers and work in the deli and bakery.

Saturday, Weis closed its stores early, he said, but by then most customers had gotten what they needed.

"Saturday, clearly, was a day of lost sales," Curtin said. "But more often than not we come out ahead."

Restaurants, theaters lose out

Restaurants, movie theaters, and other recreational activities are hit hardest by storms, Christopher said, since there are few ways to get someone to take an extra trip in place of one that person didn't take the previous weekend.

"When things thaw out, people don't see two movies or eat twice as many hamburgers," Christopher said. "The restaurants are going to take a hit on this and not make it up."

That's a strong incentive for restaurants to reopen quickly. In snow-clogged York, where travel was banned until 3 p.m. Sunday afternoon, some restaurants stayed open, while others opened Monday.

Marcello's Pizza on South George Street in York stayed closed Sunday while snow was cleared, said Yanira Nieves, the restaurant's assistant manager. By Monday the snow was cleared, and the restaurant opened.

Nieves said once a day's business is lost, there's no way to make it back.

"We lose our hours, we lose business," Nieves said.

Central Family Restaurant in York opened Sunday after an early closure Saturday, said owner Karl Spangler.

Though the storm was one of the worst he's seen in his 19 years running the diner, Spangler said he's also spent less on rock salt and parking lot plowing services this year since winter started later than in previous years.

Spangler agreed that, in the restaurant business, a day's business lost is lost forever. However, he said it's possible that the weather could bring out a few extra customers fed up with staring at their walls.

"I do think that, in this type of a storm, people get stir-crazy," Spangler said.

Some retailers could benefit 

For clothing retailers such as Bon-Ton, which often cites unseasonably warm weather as a cause of low sales, the snow might bring good news. Christopher said clothing sellers are expected to see a "pronounced" bump in sales after the storm.

"This winter's record-breaking warmth has produced plunging sales at clothing retailers," Christopher said. "In addition, there has been an excessive accumulation of clothing inventories in the third and fourth quarters. This snowstorm may spur consumers to make long-overdue purchases of winter-weather gear, providing a much-needed boost for clothing sales."

Bon-Ton stores closed Saturday, though many were open by Sunday, said Christine M Hojnacki, a company spokeswoman.

"Our stores in Central Pa. were certainly affected by the blizzard," Hojnacki said.

Retailers that have an online sales platform benefit the most, Christopher said, since snowbound consumers are apt to shop online while stuck at home.

In addition, Christopher said, home supply stores such as Lowe's and Home Depot will see strong sales, as consumers seek to fix storm damage and prepare for more snow by preparing with items such as shovels, rock salt and snow-blowers.

For small businesses, the rules are bit different, said Caroline Morris, owner of Kimman's Co., a gift store in York.

Morris stayed open during most of the storm, despite a lack of shoppers, to stock new inventory and prepare wedding invitations that had been ordered. Morris said the storm hit her on her busiest day -- Saturday-- and those potential sales are lost forever.

She said she's hoping that some of those shoppers who missed out last week will feel like visiting the city as it gets cleared out.

"Tell people to...get downtown this weekend," Morris said. "We're here, and we're happy to see them."

*This article is part of a content-sharing partnership between WITF and the York Daily Record

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