Hurricanes Batter South Florida Retailers
September 13, 2004,
MIAMI – As Ivan appeared to be headed for Florida late last week, retailers were still assessing the financial impact of Frances from Labor Day weekend.
An unwelcome visitor to the Sunshine state, Frances hit Florida hard, keeping shoppers behind boarded windows and away from stores aisles where retailers wanted them. As a result of the storm, major stores statewide suffered serious losses – some structurally as well as financially.
“Of the 13-week period, we’ve lost two weeks completely,” he said. “That represents about a 15 percent loss. And once you lose that, you can’t make it up.”
Kmart Corp. had two stores undergo structural problems – roof and water damage -- forcing the discount chain to keep these units in Ft. Pierce and West Palm Beach closed.
“We still have no time frame on when we’ll have those repairs made,” Caryn Klebba, company spokeswoman, said. Also, many Kmart stores in Florida suffered power outages over the Labor Day weekend – some through Tuesday, she said.
Kmart would not release any information regarding the financial impact of the hurricane on its sales and earnings.
But Federated Department Stores Inc. did, reporting last week that it estimates lost sales at its Florida stores to reach about $20 million – reducing September same-store sales by 1.5 percent and earnings by about 3 to 4 cents a share in the third quarter.
Federated, based in New York, said that while it "still is too early to precisely evaluate the total impact of the weekend's devastating storm on the business overall," it did not believe any of its Burdines-Macy's or Bloomingdale's stores in Florida suffered major structural damage from the hurricane.
The hurricane's impact on sales began on Sept. 1 when stores suffered significant sales declines as shoppers concentrated on preparing for the storm. Federated's stores began closing the next day, primarily in the southeastern part of the state and the Orlando area. Over the Labor Day weekend, as the hurricane slowly traveled west across Florida, southeastern stores began reopening, but units located on the Gulf coast were closed.
As of early last week, only a handful of Federated Florida stores remained closed because of power outages.
In its weekly sales summary for Sept. 6, Bentonville, Ark.-based Wal-mart said it expects “sales in the hurricane area will be negatively impacted” as Frances continued to move through the region, “but we should see a pickup in sales as customers clean up after the hurricane has passed.”
Costa Mesa, Calif.–based Anna's Linens postponed the grand opening of its ninth South Florida store — this one located in West Palm Beach — because of delayed power outages caused by the hurricane.
Alan Gladstone, president, chairman and CEO, said his other eight units in the region were shut down for four consecutive days over the Labor Day weekend because of the storm.
They reopened Labor Day having suffered no damage. "Everyone is safe and we are all counting our blessings," he added.
Jacksonville, Fla.-based Stein Mart Inc. also sustained no structural damage to any of its 40 Florida stores — other than to signage – and its headquarters was not impacted by the hurricane, the company stated. The retailer continued normal operations throughout the weekend, Stein Mart added, and, as of Tuesday, was fully staffed.
Stein Mart did not give any estimates regarding the impact of the hurricane on quarterly sales and earnings, only saying it will report its September sales on Oct. 7.
As of Sept. 5, the Sunday of Labor Day weekend, most of Stein Mart’s Florida stores — 36 — were closed. By Labor Day, that number was reduced to 24, as the hurricane downgraded to a storm and began shifting northward to Georgia and beyond. On Tuesday, only four stores were still closed due to power outages.
J.R. United, a bedding and bath supplier based in Miami, only suffered minor delivery delays because of the pre-hurricane frenzy, Salo Grosfeld, president, said.
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