Home-Improvement Retailers Scramble to Restock in Florida
September 11 2017 - 12:28PM
Dow Jones News
By Sarah Nassauer
Home Depot Inc., Lowe's Cos. and other home-improvement
retailers are rushing supplies into Florida in Irma's wake, an
effort critical to rebuilding efforts as well as their quarterly
sales.
Big-box retailers have become increasingly intertwined with
recovery efforts after natural disasters, working to restock
supplies for local residents, first responders and area officials.
Both Lowe's and Home Depot have access to vast supplies of building
materials, power generators and other needed products, as well as
the infrastructure to keep them in stock.
Home Depot and Lowe's shares rose around 4% over the last two
weeks as investors anticipated upticks in hurricane-related
sales.
"We utilize our entire supply chain because speed is so
important to help communities restore," said Peter Capel, vice
president of field merchandising for Home Depot.
Earlier in the year, the Atlanta-based retailer preloaded trucks
and stocked four distribution centers near hurricane-prone areas
with generators, plywood, water and cleaning supplies, so that it
could resupply local stores before and after storms, Mr. Capel
said. A former Marine, Mr. Capel pushed for police escorts for
trucks to expedite their movement past barricades.
In southern Florida, Home Depot stores began reopening Monday
morning, selling supplies built up before Irma arrived, but trucks
coming from other parts of the U.S. haven't yet made it into the
state, according to a spokesman.
Storms tend to boost the bottom line for home-improvement
retailers, Baird Equity Research said in a research note last week.
"This all depends on how many stores are impacted, and what the
severity of the damage is, but it tends to be a positive impact
nonetheless" that can last up to a year as rebuilding projects get
under way.
Both Lowe's and Home Depot said they don't raise prices during
disasters and have price-freeze policies in place. Some airlines
faced criticism and price-gouging complaints as people in Florida
and the Caribbean evacuated.
Lowe's is deemed part of "restoration and recovery" in most U.S.
states, a classification that lets its trucks drive into
storm-struck areas before citizens, said Rick Neudorff, emergency
command center operations manager for the Mooresville, N.C.,
retailer. "A good portion of my responsibility outside of storm
response, when it's slow, is to build a relationship with those
people," Mr. Neudorff said.
Lowe's was able to deliver supplies to its stores in northern
Florida until Sunday. It also shifted routes so that more of its
trucks headed to the western part of the state, in line with Irma's
trajectory.
Like Home Depot, Lowe's stocked Florida stores and distribution
centers with supplies like plywood, storm shutters, water and gas
cans, and it expects to send more than 500 truckloads into the
state over the next 48 hours, including some that arrived early
Monday, a spokeswoman said. Some Lowe's stores are expected to
reopen later in the day.
The risk of damage to stores prestocked with extra inventory "is
part of the cost of doing business," said Mr. Neudorff, adding that
the retailer builds stores in areas outside of known
floodplains.
In Texas, Harvey damaged three Lowe's stores, one significantly.
The one-two punch of Harvey and Irma in the South created "natural
choke points," Mr. Neudorff said.
Generators will be in demand with mass power outages, he said.
"There are only so many bottled-water manufacturers, and everyone's
pulling back-to-back orders."
Write to Sarah Nassauer at sarah.nassauer@wsj.com
(END) Dow Jones Newswires
September 11, 2017 12:13 ET (16:13 GMT)
Copyright (c) 2017 Dow Jones & Company, Inc.
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