Hurricane Irene Gives Boost to Walmart, Home Depot

What did shoppers buy before the storm?

Hurricane Irene sent East Coast shoppers into stores in the last week of August 2011 — but not for what retailers wanted to sell. Instead of the clothes, notebooks, and supplies of the back-to-school season, shoppers stockpiled water, flashlights, batteries, and generators. Chains like Home Depot and Walmart did brisk business on Friday in every state in Irene's potential track, from the Carolinas to Massachusetts. "Most probably, the biggest demand right now is for generators, obviously," said Suzanne Roche, manager of a Sears store in Wilmington, North Carolina. "We have got customers calling nonstop."

What did it cost retailers?

Irene made its first US landfall in North Carolina on Saturday, August 27, then headed for the densely populated Northeast — arriving precisely during the second-biggest shopping season of the year. "Nobody is going to go to a mall to buy a pair of jeans," said Richard Hastings, consumer strategist at Global Hunter Securities. He estimated the storm could dent the August same-store sales index by 1.5 percentage points — real money, with about two dozen retailers due to report monthly sales on September 1 against expectations of a 4.8 percent rise.

Who wins and who loses in a hurricane?

The storm split retail into two economies. Home-improvement and essentials chains won the weekend; apparel and mall retailers lost it. Some of the lost sales would be recovered later, and post-storm rebuilding would eventually lift spending on materials and furnishings. But the timing was cruel: Irene didn't just disrupt a shopping week, it disrupted the shopping week that mattered most for fall fashion.

Irene went on to cause an estimated $15 billion-plus in damage across the East Coast. For retailers, it was an early lesson in a pattern that would repeat for years: weather as a line item in the quarterly report.