How big brands like Target and Walmart deal with back-to-back hurricanes
Major retailers must restock in one region while preparing for a potential catastrophe in another.
Just days after Hurricane Harvey ripped apart Texas, Hurricane Irma is poised for a violent sweep through Florida.
It’s a daunting time not just for residents in these hurricane zones, but for the major retailers who must rebuild in one region while preparing for a potential catastrophe in another. Target, for example, sustained serious damage to some of its stores in Texas during Harvey, but must now also focus on making sure Florida is prepared.
"We're tracking Irma and making sure our team members are safe and informed of what to do when the storm hits," Jenna Reck, a spokeswoman for Target, told NBC News, adding that the company is also making sure stores are heavily stocked with the various items people need during a natural disaster, including "bottled water, food and flashlights."
Track the Storm, Stock the Shelves
"We do a lot of work with our distribution teams based on what we know guests will need to stock up on, so we start with that," Reck told NBC News. "We're aware that some stores need merchandise, so our team is working to get things up and running."
Whether Target stores will be closed in Florida is yet to be determined, Reck said, but all 120 of the company's stores in the state could be affected. And even if the storm dies down, the company could close some stores just to be on the safe side. Before Houston was evacuated, Reck said that Target proactively closed a couple of locations, and then many more once the storm worsened.
All but two Targets that endured Hurricane Harvey remain closed, and there's no word on when they'll reopen or what it will cost to repair them; the water damage is so severe that entire buildings need to be rebuilt and none of the store’s merchandise is salvageable.
Staying Afloat and Doing Right by Employees and the Community
But all other Targets in Houston are already running close to normal — and they’re providing shifts to workers from stores that are out of action.
"For the two stores that are closed, we paid team members for a week for their scheduled hours," Reck said. "Then, we worked to move them to a different store until their store reopens."
Target also gave the 10,000 employees in affected areas a $100 store gift card and, as part of its $3.5 million Hurricane Harvey relief efforts, set up a fund with Global Impact that will match employee donations up to $1 million.
To name but a few other big players paying it forward: Amazon and Whole Foods are matching donations made via Amazon to the Red Cross up to $1 million; Duracell is giving out free batteries; Chobani has loaded up at least 300,000 products to donate; Walmart has pledged up to $10 million in cash and product to match customer donations two to one, and donated truckloads of water to affected areas — and now the mega-retailer is rolling up its sleeves in preparation for Hurricane Irma.
“We’re staying closely connected to our operators in the field to help ensure we’re stocking the appropriate items and keeping track of shipments to deliver for our customers,” Ragan Dickens, a Walmart spokesman, said in an email to NBC News. “We have emergency support teams dedicated to helping our stores during critical events such as this one. We understand that water is a need across the state and have currently mobilized 800 truckloads of water from around the country to be sent into the region to help meet this growing demand.”
Starbucks Employees Help One Another Out
Starbucks has donated $250,000 to Hurricane Harvey relief, and by donating both in-store and in-app, Starbucks customers have raised more than $600,000, said Reggie Borges, a spokesman for Starbucks.
Starbucks employees, via the Starbucks CUP Fund, have also chipped in to help fellow employees hit hard by Harvey. "The CUP Fund has raised over $300,000 in grants to [employees] directly affected by Hurricane Harvey," Borges told NBC News.
It's money that is much needed. Nearly 25 stores remain closed, and Starbucks is still paying those workers. "Work schedules go up three weeks in advance," Borges said. "If you were on the schedule, you're getting paid even if the store isn't open or if you can't make it."
Resources Run Thin in Back-To-Back Calamities
Just as all these profitable corporations can afford a bit of charity, they can afford to pay that small percentage of a displaced workforce. But the reason they’re doing it isn’t just pure generosity; it’s also financially savvy.
“Starbucks doesn’t want to lose its baristas, Target doesn’t want to have to train new employees,” said Marshal Cohen, retail industry analyst at NPD Group. “Retailers who are paying people even when they can’t work are recognizing important components: It looks good, and it promotes retention.”
But not all retailers think this way, Cohen says, and it raises the question of how long this and other charitable behavior will last if these storms continue. These companies may be big, but everybody’s got a limit.
“Resources are stretched thin and retailers don't have the excess capacity to be serving two category 5-level disasters within days of each other,” said Jason Goldberg, senior vice president of commerce and content practice at Razorfish.
On one hand, stores are better equipped than ever to handle hurricanes because, as Goldberg points out, they’ve been through a lot of them and have learned what is needed. But Cohen asserts that today’s storms tend to be far more devastating than those of the past, so that even retailers with warehouses filled with goods can find themselves coming up short.
“It used to be easy to prepare for a big storm, and retailers usually had four to five days to stock up,” Cohen said. “But in today’s world the target zones are bigger, the impacts greater, and damage is much more [substantial]. Stores may be under-stocked no matter how prepared they are.”
Riding out the storm may be tough, but rebounding from it shouldn’t be a problem.
“Once roads are open, products are back in stores before consumers are even back in homes,” Cohen said.