Business on Ice: Deep Freeze Is Hurting Small Businesses
When the temperature in New York plunged, so did revenue at Tanya Lim's dog-walking service. Many of Lim's clients were among the people who decided to work from home because of the cold, so they didn't need her services. On a day when she and her three fellow dog-walkers would normally have had 15 pets to walk, Play Pals NYC had none. One of Lim's staffers made some cat-sitting visits, but all their other appointments were canceled.
"The first week after the holidays usually everyone is back working, but we're not," said Lim, who didn't charge for the cancellations.
The severe cold and snow over the past few weeks hurt many small businesses. Restaurants and retailers were among those that suffered the most because few people wanted to go out, according to Planalytics, a company that analyzes the impact of weather on businesses. It's true that severe winter weather can be a moneymaker for some businesses like plumbers and heating repair companies. But many businesses found it harder to operate -- cities like Philadelphia, Detroit and Charlotte, North Carolina, had their coldest first week of January ever. Chicago's average temperature was 18 degrees lower than usual, and Atlanta's was 15 degrees below normal.
Even on days when Lim's company wasn't getting hit by cancellations, it was too cold to take dogs on walks of between 30 and 60 minutes. The shorter walks also meant less revenue, as fees are based on how much time a walker spends with a pooch. What helped Lim's overall cash flow was that her cat-sitting business had soared during the holidays while many people were away.
Snow and ice are rare in Charleston, South Carolina, but they caused the cancellation of events including a conference that Karen Moran expected to cater. Moran, owner of Sweet Lulu's Bakery & Cocktail Caravan, also wasn't able to make deliveries because bridges and roads were closed. She estimates that she lost $10,000 in revenue.
"Canceling that kind of big corporate event kind of does us in," she said. "We're not starting the new year off with our normal big push."
The weather can wreak havoc with a company's products as well as its operations. Soon after Linda Parry Murphy's company shipped bottles of a new fruit and/or herb-flavored beverage called Agroposta to customers, emails started arriving: The liquid had frozen and the bottles burst in transit.
It was part of a learning curve for Murphy. Her company, Product Launchers, imports Agroposta from Croatia and had shipped it from Pennsylvania to online customers and executives at Safeway stores, which plans to start selling the beverage later this year. Murphy and her team have now found ways to insulate cold-weather shipments, and the good news is that the shipments to Safeway were just samples.
But, Murphy says, "it was not a great first impression."
A layer of ice in northern Florida brought calls as well as complications to Bulldog Adjusters, whose employees inspect houses for damage so homeowners can file for insurance claims. The ice contributed to leaks inside people's homes, but the ice was a hazard in terms of getting adjusters onto ladders and roofs, marketing director Rosie Faulkner said.
"One adjuster went up there and he said, 'I can't do this. I'm going to slip and fall,'" she said.
The company brought in drones with cameras. But in some cases, the ice meant they couldn't get clear enough pictures of roof damage. The company advised homeowners to take whatever pictures they could of the damage inside their homes, but roof shots had to wait for the ice to melt.
The Mr. Rooter plumbing franchise in Tallahassee, Florida, hadn't gotten any calls from homeowners with frozen pipes in nine years of business before this latest spell, dispatcher Judy Matthews said. But it has been so cold that the franchise had about 30 calls for help, either because pipes burst or devices called backflow preventers failed as the temperature dropped.
"We're getting calls in the middle of the night," Matthews said. The manager and six technicians have worked longer hours than usual to make the repairs.
Bad weather slowed business dramatically at the Gotham Bar and Grill in Manhattan. On a Saturday night, it expects to serve 250 to 300 diners. On the Saturday night in the midst of the arctic weather, it had 201, managing partner Bret Csencsitz said. When it snowed last Thursday, there were 21 diners for lunch instead of the usual 60, and 80 for dinner.
The restaurant can withstand some dips in cash flow from a few days' cold snap in January. More worrisome would be a similar drop in business during February, when many diners are out of town on vacation, Csencsitz said. But the restaurant's staff sees their income from tips fall, so the Gotham looks to make it up to them.
"We look at what an average day is, and make sure everyone receives a similar amount," Csencsitz said.
Not even the promise of a hot drink had many of Marine Park Coffee's customers braving the cold. The tiny four-month-old shop in Brooklyn saw its revenue fall by more than a third as single-digit temperatures kept even the regulars away, owner Jhonn Thomassen said. When it snowed last week, with drifts of more than a foot in some spots, he had just 12 customers in the time he expected to have 50.
"It has been a little bit of a surprise. You do associate warm coffee as a way to combat the cold weather," he said. But Thomassen figures a cold snap can give him a chance to do some planning and bookkeeping.
"It's downtime I can use to brainstorm or use for other business needs," he said.
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