Retailers are trying to weather a difficult winter as Mother Nature throws Canada a curveball.
While generally warm weather has chilled retail sales in Central Canada, wild weather in British Columbia is giving winter products there an unexpected boost.
Up until mid-January, winter had disappeared from a large chunk of the country.
"Winter has been missing in action," says David Phillips, a senior climatologist for Environment Canada, referring to a lack of winter weather late last year and early into 2007 from Thunder Bay, Ont., to St. John's, Nfld.
"Eighty per cent of the country had a white Christmas, but only 20 per cent of Canadians saw a white Christmas," says Phillips. "It was not white in Quebec, the Maritimes and not in Timmins, Ottawa or Toronto or the interior of B.C. Victoria and Vancouver had a lot of snow beforehand but it melted."
While the snow stayed on the ground in places such as Edmonton, Grande Prairie, Winnipeg, Saskatoon, Yellowknife and Whitehorse, Phillips says the traditional Canadian winter may be a thing of the past.
"Our winters are different now. Our climate is different. Our winters are shorter, they're balmier, the character of winter is changing in Canada like no other season," says Phillips. "Oldtimers are right when they say winter isn't what it used to be."
Going back 25 years, there were as many warm winters as cold ones. Now, says Phillips, for every cold winter there are five that are warmer than normal.
"It's causing chaos in the retail sector as people are creatures of habit," he says. "They're not buying winter garments. Why would you buy a snowblower when there's no need for it?" Early indications show at least one major Canadian retailer has taken a hit because of the weird winter weather.
Same-store sales, for the 10 weeks ending Jan. 7, 2007, plunged 8.1 per cent for the Calgary-based Forzani Group Ltd.'s franchise business, which is primarily based in Eastern Canada. The company blamed unseasonably warm weather. On the other hand, corporate same-store sales were up by 0.5 per cent in the West, where the winter weather was not as unusual.
Forzani, one of Canada's largest retailers of sporting foods, operates stores from coast to coast under four corporate banners: Sport Chek, Coast Mountain Sports, Sport Mart and National Sports. The company is also a franchisor under the banners of Sports Experts, Intersport, RnR, Econosports, Atmosphere, Tech Shop, Nevada Bob's Golf, Hockey Experts, Pegasus and Fitness Source.
Canadian Tire Corp. also blamed the weather in slashing profit estimates for 2006. The company said operating earnings for the year will total $4.20 to $4.28 per share, down from a forecasted $4.25 to $4.40.
Customers flocked to Canadian Tire stores to buy non-seasonal goods. However, winter-related sales dipped 16 per cent.
"The challenge is that we're not in a static environment. Weather in Canada is extremely unpredictable," says Derek Nighbor, vice-president of national affairs for the Retail Council of Canada (RCC).
"What we're dealing with is a variable that makes it difficult for anybody to say hard and fast what we're going to do."
Nighbor says he was surprised to go home to the Ottawa area for Christmas "and see my dad raking the lawn."
He says retailers have several options, including developing a positive relationship with suppliers in order to build in contingencies. This can mean getting the best price possible or arranging for returns if goods aren't sold.
Retailers can also diversify the product offering, says Nighbor, or add giftcards to their lineup. This way, purchases can be made weeks later when winter weather has arrived and customers are ready to buy the parkas, skis and other items that they didn't want to buy when it felt more like a spring day outside.
"Maybe you don't bring your winter clothing in until later in the season," suggests Nighbor.
Industry analyst Len Kubas offers an alternative idea: Bring in the goods even earlier.
"This year, there has been funny weather for the entire winter season. I think retailers (almost) everywhere are suffering as a result of that," says Kubas, president of Toronto-based Kubas Consultants, a marketing research and consulting firm.
They can advance the season, says Kubas, by bringing in product weeks before their normal schedule.
This also allows them to advance their winter clearance sales, so they have more time to move the items if they don't sell and not be as hard-pressed to slash prices once next season's goods arrive.
"This can compensate for things they can't control," says Kubas. "We've been studying retail trends for over 30 years and we've seen good winters and bad winters. There's a direct relationship between retail sales and how cold it is."
Drenching rains and a series of windstorms wreaked havoc in British Columbia in late 2006. But Retail BC president and CEO Mark Startup says that he has no reason to believe that all retail sales have been affected by the weather.
"It certainly has affected some retailers negatively, but not all. In some cases, it's been very positive," says Startup, who won't know any final sales figures until next month.
"It would appear to me at this point that the calmer weather immediately prior to Christmas allowed consumers to catch up for any lost time."
Startup says sales of outdoor gear such as snowshoes, snowboards, skis and related items are also doing well because of more winter-like conditions in the usually balmy Lower Mainland.
Startup adds he's not hearing indications that Retail BC's 3,000 members are going to miss their seasonal objectives because of the bad weather.
"There are so many factors that retailers try to monitor in determining why their sales are up, down or flat on any given day, month or quarter - it's very complicated. Weather is one of those factors for retailers. But they'll plan their seasons based on expected weather patterns."
Adds Nighbor: "Retailers are not people who are faint of heart. They're always on the leading edge of meeting their customer demand and weather is just one variable."
Environment Canada's Phillips has some good news for the retailers who still need to move their seasonal goods.
"It may be late for retailers, but two-thirds of the winter is still to come," says Phillips. "I'd be the most surprised person in Canada if winter didn't make an appearance in all parts of Canada."
