Weather Retailing

"Everybody talks about the weather, but nobody does anything about it." -- Editorial, Hartford Courant, 1897

Weather has become an important factor in determining what people buy. An unusually heat wave might cause consumers to stock for soft drinks / energy drinks, umbrellas, sun creams, t-shirts / skirts, etc and a cold wave causes consumers to buy more of cold creams, sweaters, soups, movie rentals, etc.

Keeping a tab on weather also helps retailers create a better baseline for planning merchandise, accelerate markdowns, prepare for margin markup & marketing promotions and other such activities.

Incorporating weather in inventory planning can either be Tactical and Strategic in nature.

1. For tactical purposes one can adjust inventory at the floor level thereby increasing or decreasing “merchandise density” meaning if a store manager knew that tomorrow would be a very hot day, he would stock more of cola bottles thus increasing merchandise density.
2.  For strategic planning, retailers need to incorporate long-range weather forecasts into business planning. For e.g. if unusual rains or cyclone is expected in a few days, retailers can source for umbrellas or rain coats.

Although, weather can be a determining factor in predicting sales, retailers have no more than 5-7 days of forecasts, but this period alone can help retailers outperform their competitors.