Winter economic slowdown? Not for Campbell’s soup

Mark Garrison Feb 17, 2014
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Winter economic slowdown? Not for Campbell’s soup

Mark Garrison Feb 17, 2014
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Nasty winter weather is largely bad for the economy. Freezing weather means smaller paychecks for part-time workers, fewer customers in stores and delays in shipping and manufacturing. But there are a handful of industries that actually thrive in brutal weather, though cashing in can be tricky.

Campbell’s Soup stock soared Friday on better than expected earnings, driven in part by surging soup sales.

“In the southeast region, on-demand usage increased by more than 30 percent,” says Todd Smith, spokesman for cable company Cox Communications.

The hope for Cox and other media companies is people stuck at home might get turned on to faster broadband, premium channels, or streaming video service.

At some point, people must leave the comfort of warm soup and abundant television to brave the icy outside world. They’ll have to go shopping for coats, gloves, and boots.

“We could have sold a lot more if some of the suppliers actually had more,” says Dave’s New York president Bob Levy. His stores sell winter clothing and sales are up about 10 percent.

And yet, Levy says his store can’t order enough. That’s because today’s manufacturers are built extra-lean, in order to keep expenses down. That means many don’t have extra workers or materials sitting around if they need to make more boots.

“You realize you don’t have leather, you don’t have the sole, you don’t have all the components,” explains Harvard Business School logistics professor Ananth Raman. “And you don’t also have factories that are sitting ready to go.”

That means additional boots may not be ready before spring, too late to turn snowfall into windfall.

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