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Holy Crap sold, but will remain in Gibsons

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Company founder Corin Mullins announced this week that after spending the past year meeting with a few companies that share her values as candidates to take over, she has sold the business, and new company president Donna Reddy is now at the helm.

“It has been an extraordinary journey encountering many wonderful people along the way,” said Mullins in the release announcing the sale. “I am especially pleased the new company will continue producing Holy Crap at the existing facility in Gibsons with the same team providing the consistent quality our customers have come to expect.”

According to the company, Reddy has a proven record with nine other national natural health products.

Reddy told Coast Reporter via email that she was with GreenSpace Brands in Toronto as the marketing vice president for the past five years. The company was responsible for a line of organic baby food called Love Child Organics, organic juices and kombuchas and Central Roast – a line of nuts and snacks.

“I am excited about Holy Crap and seeing where we can take the brand. I am still in the discovery process; getting to understand our existing consumer, looking at what works, and identifying all of the opportunities,” Reddy said.

Mullins will be involved in the transition to the new management team over the next three months and will remain as a “mentor on a consulting basis.”

“I look forward to maintaining the many friendships that formed while running the company,” she said.

Local businessman Dino Sita has also been added to the management team, bringing his extensive food industry experience.

Mullins created Holy Crap as a tasty cereal her late husband Brian could enjoy without triggering his food allergies. The launch 10 years ago coincided with the rising interest in clean eating and allergy-free foods and the company took off, boosted by the Mullins’ appearance on CBC’s The Dragons’ Den.

The product is now sold worldwide and has even been served on the International Space Station.

Source: www.coastreporter.net

Nutrition 21 Announces:

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Citrulline Malate and Nitrosigine Both Significantly Better Than Placebo.

In attendance at this year’s ISSN (International Society of Sports Nutrition) Annual Conference, Nutrition 21 was excited to hear the significant results of an independent study presented by researchers from the University of Arkansas studying the significant blood flow impact of Nitrosigine®. The clinical study poster entitled “The Acute Effects of Citrulline Malate and Bonded Arginine Silicate Supplementation on Vasodilation of Young Adults” was presented by lead author Jeffrey Rogers from the University of Arkansas American College of Sports Medicine. Nutrition 21 provided no support and did not participate in the design or implementation of the study.

The study compared two popular ingredients used in sports nutrition today: citrulline malate (CM ) and bonded arginine silicate (Nitrosigine®). Nitrosigine® is a leading branded ingredient used in a variety of consumer products with a legacy of continued success in the sports nutrition and pre-workout arena. Nitrosigine® is added to formulations in order to significantly increase serum arginine and nitric oxide (NO) levels, reduce markers of post-workout muscle damage and increase cognitive processing speed. CM is used for its ability to increase blood serum concentrations of arginine, resulting in NO production.

Dr. Michelle Gray, Associate Professor and the Director of the Exercise Science Research Center at the University of Arkansas, commented “Current research has yet to compare CM and Nitrosigine® in vivo using a flow-mediated dilation (FMD) technique, a validated measure of the vascular endothelium’s NO producing ability. We identified a need and designed the experiment with the purpose of determining the effectiveness of Nitrosigine® and CM compared to placebo, in up-regulating NO production in blood vessels as measured by acute changes in vasodilation.”

The double-blind, placebo-controlled, crossover design study was performed, with a 7-day washout period between test visits. The subjects were 22 healthy, normotensive, and at least moderately active male (n=14) and female (n=8) young adults.

Results showed that a single dose of 1.5g of Nitrosigine® significantly increased FMD, a measurement of increased vasodilation, blood flow, and possibly nitric oxide levels, more than placebo (p<0.01) and to the same extent as 8g of CM.

Overall Clinical Results of the Study:

  • In a double-blind, placebo-controlled study, both Nitrosigine® and CM supplementation led to an equally significant increase in vasodilation and blood flow, but with a dose of CM (8g) that was 5x more than the dose of Nitrosigine (1.5g)
  • Overall, these data show that a single dose of 1.5g of Nitrosigine®:
  • Significantly increases vasodilation and blood flow, important for increases in muscle pump, as measured by FMD, inactive young adults compared to placebo
  • Significantly increases FMD, a nitric oxide-related measurement, inactive young adults compared to placebo
  • Significantly increases FMD, a measurement of vasodilation, blood flow, and nitric oxide production, as well as 8g of CM increases those metrics

“Nutrition 21 was excited to hear of this independent study and the positive results showing the benefits of Nitrosigine® on increasing vasodilation, a process driven by increasing nitric oxide production, and believed to enhance a number of sports performance endpoints. We are especially pleased that this study was designed to test a healthy, athletically trained population, and showed that a 1.5g dose of Nitrosigine® worked as well as 8g of Citrulline Malate, in increasing flow-mediated dilation,” says James Komorowski, MS, CNS, Chief Science Officer at Nutrition 21.

About Nitrosigine®: Nitrosigine® is a patented complex of bonded arginine silicate with FDA New Dietary Ingredient (NDI) notification status and has been self-affirmed Generally Recognized As Safe (GRAS) at the level of 1,500 mg per day for use in nutritional bars and beverages. Nitrosigine® is scientifically engineered to boost nitric oxide levels, which have been shown to be a key factor in generating greater blood flow and vasodilation in working muscles. The unique Nitrosigine® complex bonds arginine and silicate – unlocking powerful synergistic effects that offer enhanced benefits. Nitrosigine® is a safe, non-stimulant, effective ingredient that is easy to formulate into new and existing products for sports nutrition, men’s health and cardiovascular health.

Source: Nutrition 21

Alberta grocer’s subrogated $761,000 profit loss claim before the courts

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In Sobeys Capital Incorporated v Whitecourt Shopping Centre (GP) Ltd., released this past Friday, the Court of Appeal for Alberta ruled partly in favor of landlord Whitecourt Shopping Centre, a defendant in the subrogated claim filed by commercial insurer FM Global.

The subrogated claim was filed in the name of Sobeys Capital, a tenant in the mall. [Sobeys and IGA are brands of Empire Company Ltd.]

In its ruling released Oct. 4, the Court of Appeal of Alberta ruled that Justice Kevin Feehan of the Alberta Court of Queen’s Bench erred in awarding $761,000 in damages for loss of income.  The Court of Queen’s Bench ruling was released in July 2018.

The finding that the landlord is liable under the lease agreement still stands. The lease requires the landlord to maintain the roof in good condition.

With regard to damages, the appellate court ruling does not mean FM Global is unable to recover its money from the Sobeys Capital claim. It means it is still open to the landlord, Whitecourt Shopping Centre, to argue that the damage award should be lower.

The original 2018 ruling was a summary judgment on multiple lawsuits arising from the roof collapse. At that time, Justice Feehan ruled that he had enough evidence before him. So the issues of liability and damages do not need to proceed to trial, Justice Feehan ruled in 2018.

But as a result of the appeal court ruling, the question of damages from loss of income is being remitted to the trial court.

In responding to the landlord’s appeal, Sobey’s argued the calculation of lost income should not change. The loss was adjusted by the insurer and paid to Sobey’s. Plus, the defendant chose not to bring in evidence that contradicted this, Sobey’s argued in the subrogated claim.

But the people who prepared evidence for calculating the loss did not provide sworn affidavits or sworn evidence in any other form, the appeal court noted in its unanimous decision. So Justice Feehan erred in relying on those documents, the appeal court ruled, finding the loss schedules constitute hearsay evidence. The appeal was heard by Justices Peter Costigan, Jo’Anne Strekaf and Dawn Pentelechuk.

“One of the reasons for excluding hearsay evidence is the fact that the author of the evidence cannot be cross-examined on the evidence,” wrote the appeal court. “Hearsay evidence of damages calculations is not admissible, regardless of whether or not the opposing party has led contradicting evidence,” the appeal court wrote.

The appeal court upheld other parts of Justice Feehan’s original ruling.

Whitecourt argued that Justice Feehan erred in his interpretation of the lease documents and that he erred in concluding that the lawsuits were appropriate for summary judgment instead of a full trial.

The appeal court upheld the finding of liability, ruling that Justice Feehan’s interpretation of the lease agreement was reasonable. Although Justice Feehan also found that Whitecourt Valley Centre Limited Partnership was liable, that partnership appealed on the grounds that it was not liable under contracts to which it was not a party. Sobey’s conceded that point, the appeal court noted.

On Jan. 7, 2014 the roof of the Whitecourt Shopping Mall collapsed for the fourth time in 18 years. That resulted in the closure of the IGA for more than six months. The roof of the same mall first collapsed in 1996, about five years after it was built. It collapsed a second and third time in early 2007.

Several lawsuits against various parties resulted.

Sobey’s said it lost profits because it was unable to sell a product to the supermarket during the story closure. Sobey’s sought damages of $761,811 for lost profits and $16,980 for lost rent.

The lost rent claim was not changed on appeal.

For the lost profits claim, the damages were calculated by an accounting consultant retained by FM Global. The accounting consultant calculated a reduction in sales by $7.26 million. With a gross profit rate of 10.9%, the lost profit would be $792,779. But when subtracting savings on utilities and other costs, the net loss of profit calculation was $761,811.

Engineering reviews after the fourth collapse “showed significant deficiencies in the truss design, manufacture and installation such that the trusses simply could not carry the roof loads actually imposed upon them over the years,” Justice Feehan wrote. The fourth collapse took place underneath a ventilation unit and no program was in place to remove snow from the roof at the time of the most recent collapse, Justice Feehan added.

Source: Canadian Underwriter

Whole Foods Store inaugurates its ‘Robotic Barista’

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Whole Foods Market opens its new Houston-Midtown location aimed to open on Nov. 7, the location uniqueness is the claim to be the creator of the world’s first gourmet robotic barista.  The company will offer shoppers an in-store coffee service, Briggo Coffee Haus, featuring Whole Foods’ artisan house brand, Allegro Coffee.. Opening day celebrations will also include complimentary refreshments, bites and music before the store opens. The first 300 customers will receive a Whole Foods Market South Lake Tahoe reusable tote bag, as well as a savings card with a mystery value ranging between $5 and $100 and a miniature loaf of bread to honour the Whole Foods Market tradition of breaking bread with the community.

“We can’t wait to welcome the South Lake Tahoe community into their new Whole Foods Market,” said Wes Mewes, Store Team Leader. “We look forward to providing our customers with a wide selection of fresh, responsibly sourced and innovative products, and a variety of local items and prepared foods.”

Source: progressivegrocer.com

OrganicEye Petitions USDA to Remove Carcinogen from Organic Food

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In an effort to remove cancer-causing nitrites from deli-type and other processed meats labeled organic, the industry watchdog OrganicEye has petitioned the USDA’s National Organic Standards Board (NOSB). At its public meeting next week, the NOSB will consider whether cured organic meats may continue to be processed with nonorganic celery powder, which contains high levels of nitrates. The powder is derived from celery grown with high levels of synthetic nitrogen that are absorbed by the plant and then used as a nitrate-based preservative.

“The continued use of this material in organic meat is in conflict with the law that requires all synthetic and non-organic ingredients to be safe for the environment and human health,” said Mark Kastel, director or OrganicEye, a project of national group Beyond Pesticides, which bridges consumer, farmer, environmental and public health interests.

The Organic Foods Production Act prohibits synthetic nitrate use in organic crop production and adding nitrates or nitrites in processing. “Nitrates and nitrites are prohibited in organic food because of their impacts on human health, which include methemoglobinemia, hypotension, risk of pregnancy complications, a number of reproductive effects, and cancer,” the group’s lead scientist, Terry Shistar, PhD, stated. “Substituting celery powder grown with high applications of synthetic nitrogen, when it has the same biological action in the human body, is unethical and undermines the reputation of organic food as the safest marketplace alternative,” she continued. As an alternative to celery powder, OrganicEye suggests that meat processors and retailers can distribute similar products, without preservatives, that would be required to be kept frozen rather than adding nitrates.

OrganicEye is also recommending that the Board remove the synthetic amino acid methionine from the list of allowed synthetic substances, no longer allowing it to be added to organic poultry feed. The additive facilitates industrial-scale confinement operations, rather than managing poultry with outdoor access as required by federal law.

OrganicEye is a project of Beyond Pesticides.

Source: OrganicEye

What is Boswellia?

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The treatments for these conditions tend to revolve around reducing inflammation. By helping control inflammation, Boswellia may minimize the symptoms of chronic inflammatory conditions.

Scientific research is beginning to support the benefits of Boswellia, but most studies to date have used cells or animal models. Scientists do not know the effects of this substance in humans, so many more clinical trials with humans are necessary before doctors can recommend this treatment.

In this article, we look at what the current scientific evidence says about the benefits and risks of Boswellia.

Boswellia comes from the Boswellia serrata tree, which is native to India, North Africa, and the Middle East. Farmers tap the tree to collect its resin, which is called Boswellia. Boswellia resin has a rich scent and flavor. It is very popular as an incense, and most people know it by its common name — frankincense.

What are the benefits?
Natural health practices have used Boswellia for centuries to treat various chronic inflammatory disorders. The scientific research on Boswellia is less developed, but it is beginning to unveil potential uses for the resin and its extracts.

Boswellia and its active ingredients, such as boswellic acid, appear to have a good anti-inflammatory effect on the body, according to a review article. The following sections discuss the evidence behind its potential benefits for inflammatory health conditions.

Rheumatoid arthritis
Inflammation around the joints is the leading cause of rheumatoid arthritis (RA) symptoms. Many treatments for RA, which include nonsteroidal anti-inflammatory drugs (NSAIDs) and steroids, focus on reducing inflammation. Boswellia appears to be effective in reducing inflammation, so it may also lessen the symptoms of RA. The Arthritis Foundation recommends boswellic acid capsules as a potential therapy for RA, as well as for osteoarthritis. The authors of a 2019 study suggested that an active extract of boswellia may help reduce inflammation in people with RA. However, this study used rats, so the results may not apply to humans. In this animal model, the anti-inflammatory effect of boswellia was less significant than that of a standard prescription medication called indomethacin. However, the researchers noted that the extract might be useful as a complementary therapy to support traditional RA treatment.

Cancer and cancer therapy
A 2016 review paper reports that boswellic acids might have antitumor properties and be toxic to cancerous cells. The authors conclude that this could make them helpful in future cancer treatments, though clinical trials are necessary to confirm this. A recent study in the journal Oncotarget also found that the essential oil from boswellia impaired aggressive skin cancer cells without harming healthy skin cells. However, the researchers used cells and animal models. While these early results seem promising, more research in humans needs to expand on these initial findings to determine how boswellia may help with cancer therapy.

Inflammatory bowel disease
The anti-inflammatory effects of boswellia may also be beneficial for people with inflammatory bowel diseases (IBD), such as ulcerative colitis and Crohn’s disease.A study in the World Journal of Gastroenterology looked into the action of these compounds. In animal models, boswellic acids improved markers of IBD without causing adverse effects on the surrounding organs. They may, therefore, prove to be a useful supportive treatment for these chronic conditions. Again, this is early research, and research in humans will need to back up these findings before experts can make any recommendations.

Asthma
Boswellic acid may also have a role in asthma treatment. Research findings have shown that boswellic acid suppresses inflammation in the airways and inhibits the secretion of cytokines, which are markers that lead to inflammation. Thus, boswellic acid appears to block off the allergic response that causes an asthma reaction in the first place. In the future, this may make boswellia a helpful complementary treatment for asthma. For now, researchers need to focus on working toward studies in humans.

Parkinson’s disease
A 2019 study found that boswellia may be a helpful tool in medical efforts to treat Parkinson’s disease. In animal models, boswellia had an anti-inflammatory and antioxidant effect, which appeared to protect neurons in the brain and improve motor function in a rat model of Parkinson’s disease. However, this is early research that needs backing from studies involving humans.

How to take Boswellia
Boswellia comes in a few different forms, and the quality can vary widely. The Arthritis Foundation recommend taking approximately 300–400 milligrams (mg) of boswellia three times per day to deliver boswellic acids to the body. They recommend looking for capsules that contain 60% boswellic acid, as it is the active ingredient.

Many retailers, both online and in stores, will sell the resin in capsules. It may occasionally be possible to buy the raw resin, which has a hard texture similar to that of sap. People may extract active ingredients, such as boswellic acids, from the resin and add them to a capsule or tablet. People can choose between different boswellia extracts and supplements in stores or online. Pure frankincense essential oil may also deliver active compounds to the body. Diluting this essential oil in a carrier oil and applying it to the body may allow the compounds to enter through the skin. It is important to test the diluted oil on a small area of skin first to check for reactions. Boswellia may also be an active ingredient in natural blends for inflammation, which often include other ingredients, such as turmeric. Anyone considering these products should talk to their doctor before using them to discuss potential drug interactions.

Side effects and risks
Boswellia is a natural extract, but it can still have side effects. It may cause digestive side effects, such as nausea, acid reflux, and diarrhea. Some people may experience skin rashes when using boswellia, especially if they apply it directly to the skin. Boswellia appears to act as an anti-inflammatory. As a result, it may interact with similar drugs, such as NSAIDs. It is important to talk to a doctor before taking boswellia alongside other medications, such as:

  • aspirin
  • naproxen
  • ibuprofen

Boswellia may also interfere with the action of certain drugs, including some anticoagulant medications and antiplatelet drugs. Anyone taking these drugs should talk to a doctor before taking Boswellia.

Source: Medica news today

Pillsbury owner buys two organic baking brands

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The Chicago company that owns the Pillsbury brand is expanding into the health-conscious food market, acquiring organic baking brands Arrowhead Mills and SunSpire.

Hometown Foods today said it bought the brands for $15 million from New-York based Hain Celestial Group. It also acquired Arrowhead Mill’s manufacturing facility in Hereford, Texas.

The Chicago company said the move is part of its larger effort to expand its portfolio and capitalize on health-conscious trends in the market.

Arrowhead Mills sells organic and gluten-free breakfast foods and baking products. SunSpire specializes in organic chocolate with non-dairy and gluten-free offerings.

Headquartered in the West Loop, Hometown Foods was created last year when East Coast private-equity firm Brynwood Partners bought the Pillsbury brand and other baking products from J.M. Smucker for $375 million.

Brynwood CEO Henk Hartong called Arrowhead Mills and SunSpire “pioneers in the organic, non-GMO ingredients space,” adding in a statement that the acquisition “strengthens our industry position by adding improved capabilities in the better-for-you space that we plan to extend into our other categories.”

Most of Hometown Foods’ products are manufactured at a 650,000-square-foot former Smucker facility in Toledo, Ohio.

Source: www.chicagobusiness.com

Organic groups get USDA money to direct future research

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With an infusion of grant money from the USDA, a coalition of organic groups is hoping to change that.

Let’s start off by noting that this is not about organic marketing or other tactics from organic-driven corporations that tend to divide farmers, scientists, and the public. Rather, this is — hopefully — about learning how to work more efficiently with less impact if you choose to grow foods using organic production methods.

Last week, the Organic Farming Research Foundation and Organic Seed Alliance were jointly awarded funding for their proposal titled A National Agenda for Organic and Transitioning Research. This funding will allow the organizations to conduct national surveys of organic producers to put forth an updated and comprehensive roadmap for future research investments.

“With demand for organic products continuing to outpace domestic production,” OFRF’s Executive Director Brise Tencer said, “the organic industry needs more research that helps existing organic farmers scale-up, diversify, and increase profitability, and also encourages more farmers and ranchers to transition to sustainable organic practices that are better for the environment and people.”

These groups and others helped to secure an increase in federal funding for organic research of $50 million (up from $20 million) in the 2018 Farm Bill. This increase provides an opportunity for researchers to tackle the challenges that inhibit the growth of organic production.

“Organic farmers produce food differently, and that means they need different seed for the crops they grow — seed developed to thrive without synthetic fertilizers and pesticides, and adapted to their local climate and soil conditions,” says Kiki Hubbard, who co-leads OSA’s State of Organic Seed (SOS) project, which helps to monitor the status of organic seed in the U.S. to increase the diversity, quality, and integrity of organic seed available to farmers.

Source: www.agdaily.com

Bank of America projects a slowdown in holiday spending this year

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  • Holiday season spending is set to slow this year due to warmer weather, a shorter holiday, increased inventory, and trade-war tariffs, Bank of America Merrill Lynch analysts wrote Monday.
  • The US consumer “remains strong” despite economic warning signs, they added.
  • Aaron’s, Burlington, and Target should outperform the retail industry should spending slow through the fourth quarter, the analysts projected.
  • Visit the Markets Insider homepage for more stories.

Holiday season spending is poised to slow this year, according to Bank of America Merrill Lynch.

Tariffs, warmer weather, a shorter holiday season, and increased inventory would all be to blame for weaker sales, the bank’s analysts wrote in a Monday note. The bank projected same-store sales to grow by 2.7% in the fourth quarter, down from 3.8% last holiday season.

Online sales growth and weakening consumer demand also threaten retailers this holiday season, UBS analysts wrote in a September 23 note. E-commerce sales growth hit a six-year high in 2019 after surging 25%, according to the bank.

The US consumer “remains healthy” despite growing fears of economic recession, the team of BAML analysts said. Should the retail industry face a holiday headwind, certain value stores could benefit from discount-seeking customers, they added.

Here are the three companies BAML expects to outperform the retail industry this holiday season.

The analysts named Aaron’s their “Retail Hardlines top pick” for its acceleration in invoice volume growth and strong appeal among low-income consumers. Aaron’s Progressive Leasing business offers a lease-to-own financing option for customers, and has led to partnerships with large retailers like Best Buy.

Only a “low-mid single digit percentage” of Aaron’s products is imported from China, insulating the business from tariff-related profit squeezes, the team led by Lorraine Hutchinson wrote. Its lease contracts also help spread revenue over a longer period of time, making the shorter holiday season less of an issue.

Warmer weather should have a smaller impact as well, “since seasonal products represent a very small percentage of sales,” the BAML analysts said.

The bank rates Aaron’s stock “buy” with a $75 per share price objective.

Source: markets.businessinsider.com

What Do You Call A Holiday Retail Forecast That Ignores The Weather? Wrong

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The National Retail Federation is out with its typically optimistic prediction for the coming holiday season. This year the NRF expects retail sales during November and December to increase between 3.8% and 4.2% over the previous year. Sales are expected to reach somewhere in the neighborhood of $727.9 billion and $730.7 billion, excluding automobile dealers, gasoline stations and restaurants.

Is there any realistic hope that retail will hit that mark? Let’s look back at the 2018 holiday season when the NRF was calling for a 4.3% to 4.8% increase. When all was said and done, the retail market grew only 2.1% year-over-year, making holiday 2018 the slowest season since 2009.

In this year’s statement, NRF chief economist Jack Kleinhenz noted the difficulty in making predictions in what he termed an increasingly “uncertain macroeconomic environment.” Nonetheless, he put on his rose-colored glasses and came out with a forecast for strong growth this holiday season.

“There is significant economic unease, but current economic data and the recent momentum of the economy show that we can expect a much stronger holiday season than last year,” Kleinhenz said. “Job growth and higher wages mean there’s more money in families’ pockets, so we see both the willingness and ability to spend this holiday season.”

These annual NRF holiday predictions are getting to feel a bit like “Groundhog Day” and the forecasts resulting from it about as reliable as Punxsutawney Phil’s. That is why I called Paul Walsh, IBM’s global director of consumer weather and climate strategy, for the real holiday forecast.

Walsh explains that he is not an economist but that NRF’s economic model, which the release states is based upon employment data, wages, consumer confidence, disposable income, consumer credit and previous retail sales, may be underestimating an increasingly important factor affecting retail sales. That is the weather.

After posting, an NRF spokesperson provided a statement that Kleinhenz, a former president of the National Association of Business Economists, relies on a complex economic model. And while the release only states six indicators are included, his model “consists of well over a hundred, including weather.” The spokesperson also added Kleinhenz “does not make-up numbers to give a good spin for the retail industry.”

Shoppers respond to the weather
“Weather has a significant impact on our emotions and the way we feel which translates into retail sales,” Walsh told me. “When it gets cold, it flips the switch into thinking about holiday shopping. When it is 90 degrees in Atlanta in October, it doesn’t feel like its time to start buying things for winter.”

The weather will have a profound effect on both retailers’ topline and bottomline results this year, as it did last year. “Retailers have always known weather has a big impact on results. But what’s changed now is that because of our greater data assets and technology, we can integrate those insights into retailers’ enterprise resource planning (ERP) systems, so they have the right products in the stores at just the right time,” he continues.

What Walsh sees in the clouds for the holiday shopping season is an unseasonably warm October and November which will slow demand for winter and holiday season goods. It will be the exact opposite from last year when October and November were unseasonably cold. Since retailers traditionally use the previous year to model the next, retailers are likely to be overstocked in winter goods before consumers start shopping.

The risk then is for retailers to respond to markdown pressure early in the season, putting margins at risk. “By being too aggressive in markdowns early in the season, when demand finally kicks in December, they may well have given away too much margin early in the season,” he believes.

December’s colder weather can help drive positive comps from last year for seasonal apparel and hardlines, but that might skew spending away from non-seasonal gift items. Further, retailers’ December results may be mitigated by fewer shopping days this December compared to last year.

Retailers’ comps ignore the weather

The problem with predictions that don’t accurately factor in weather is that retail comps assume the weather will be the same year-over-year, which it rarely is.

“When retailers are able to integrate weather into their replenishment and markdown forecasts, they can predict what they will need where and when they will need it, so they have the right stock levels. With weather data added, the accuracy of those systems are increased by 20% to 25%. The benefits can be really significant,” he says, referring to a study that IBM conducted entitled “Just Add Weather.”

“Our rule of thumb is that a 1% increase in a demand forecast’s accuracy for a billion-dollar business can net out to about a $10 million benefit from improved in-stock positions and reduced mark downs,” Walsh says. “By adding weather into a demand forecast for seasonal product categories, we’ve seen companies increased forecast accuracy more than 20%.”

“This is what we call the ‘forecast factor’ and it is becoming super-critical for retailers to understand,” he continues. That is because both retailers and consumers have greater access to better and more predictable weather forecasts. “Everyone has a super weather forecaster in their pocket, called a smart phone,” he quips.

One retailer that understands this powerful forecast factor is the U.K.’s Marks & Spencer. “They are using weather to create more resilience in their supply chain. They get weather reports from us daily and use that information to make decisions every day affecting distribution and pricing,” he shares. He also noted how a national drug store chain uses advanced weather data to engage with customers where symptoms are likely to flare up and prescriptions will be need to be filled.

“CEOs, CFOs and stock analysts are beginning to recognize the influence of weather,” Walsh comments, as he points to a recent memo from Credit Suisse analyst Michael Binetti.

“Early cold weather in October is among the best upside drivers in the retail toolkit,” Binetti wrote. “And that early cold weather happened in October 2018. From here, we fear that industry commentary is poised to deteriorate in the near term. We’re increasingly cautious on the softlines retail stocks in the near-term, particularly for companies that expected a significant inflection in 4Q to get to their 2019 annual targets.”

Weather is ever changing but it is also much more predictable than ever before. “While you can’t do anything to change the weather, you can change a lot of things in business to make it have less of a negative and more of a positive impact on business,” Walsh says.

Snow for Christmas?
In closing, I asked whether we’d see snow in December and if so, how much, because nothing makes shoppers feel more like Christmas than snow. “Our long-range forecast is indicating a relatively cold December and also a relatively wet December for the East. And when those two things are combined, it increases the risk of more snow than last year,” he says and adds, “Footwear retailers call snow ‘white gold’ because it gets people to shop.”

When that snow falls will also impact holiday sales results. If it happens on a weekday, it could stimulate heavier weekend shopping for cold weather items. If it falls on the weekend, however, it will keep shoppers off the roads and out of the stores. And retailers’ weekend performance will become more critical this year, since there will be six fewer shopping days between Thanksgiving and Christmas, including two fewer weekend shopping days.

“For the next three months, it’s going to be famine-then-feast with a warm October and November, then a cold December,” he predicts. This will be the opposite of last year when it was feast during October and November followed by famine in December.

The retailers that will pull ahead this year will be those that have their eyes to the skies with a steady dose of weather-related data fed into their internal ERP systems. “The best retail and CPG companies today are integrating this kind of knowledge into supply and demand chain systems which enables them to be more proactive and responsive,” he concludes.

Note: This article was updated @ 5:30 p.m. Oct.8 with a statement from NRF received after original posting.

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