Sellin' in the Rain: Weather, Climate, and Retail Sales

• 成果类型: Article
• 署名作者: Tran, Brigitte Roth
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - San Francisco
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2023.4799
• 发表日期: 2023
• 页码: 7423-7447
• 关键词: adaptation; climate change; weather; Machine Learning; retail sales

摘要

I apply a novel machine-learning based weather index method to daily storelevel sales data for a national apparel and sporting goods brand to examine short-run responses to weather and long-run adaptation to climate. I find that even when considering potentially offsetting shifts of sales between outdoor and indoor stores, to the firm's website, or over time, weather has significant persistent effects on sales. This suggests that weather may increase sales volatility as more severe weather shocks become more frequent under climate change. Consistent with adaptation to climate, I find that sensitivity of sales to weather decreases with historical experience for precipitation, snow, and cold weather events, but-surprisingly-not for extreme heat events. This suggests that adaptation may moderate some but not all the adverse impacts of climate change on sales. Retailers can respond by adjusting their staffing, inventory, promotion events, compensation, and financial reporting.