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Heat wave: a good time to be selling pool supplies and sunscreen

Like winter blizzards, a summer heat wave favors certain segments of the economy. When it feels like Death Valley in New Jersey, air conditioners, kiddie pools, and fitness drinks sell like crazy.

Seth Wenig/AP

Con Edison employee John Leach takes a break from restoring power to a building to drink some water in New York on Wednesday. The outage, Leach says, was most likely caused by the high energy demand that accompanies a heat wave.

By Ron Scherer Staff writer

July 7, 2010 | New York

In a heat wave, you need a shade tree, ice, perhaps a new swim suit. And, how about buying the toddler a kiddie pool?

You probably don’t need hot soup, a new lawn mower, or some patio furniture.

Indeed, as the eastern part of the nation bakes for another day, there are winners and losers in the economy the same way some companies benefit during a winter of blizzards while others lose sales.

IN PICTURES: Beating the summer heat

According to an analysis by Planalytics, a business weather research company in Berwin, Pa., the winners include such products as pool supplies, air-conditioners, sun care products, and fitness drinks. The company thinks the losers will be producers of lawn mowers, outdoor furniture and fertilizer.

“Consumer behavior is less active, they stay indoors more,” says Evan Gold, senior vice president of Planalytics. “It’s great for all kinds of indoor entertainment.”

But, the total affect on the economy may not be great, says Mark Zandi, chief economist at Moody’s Economy.com.

“If the heat wave is just a few days, there will be no effect as long as there are not brownouts and blackouts,” says Mr. Zandi. “It has to be extremely disruptive to even show up in the monthly stats.”

Death Valley temperatures in New Jersey

Of course, there is hot and then there is the type of weather that produces Death Valley readings in places like New Brunswick, N.J. (105 degrees). It’s the kind of weather that sends consumers to indoor malls.

Indeed, for the week ending July 3, the International Council of Shopping Centers-Goldman Sachs weekly chain store index rose 3.9 percent compared to a year ago, the strongest pace since May 8th. The prior week (up 3 percent from last year) was strong as well, which ICSC attributed to the hot weather.

Some places, such as Harmony Mind Body Fitness, a Pilates studio in Lincoln Park, Ill. are twittering people to “come work out in the comfort of our air-conditioned studio.” Jim Hanley’s Universe, a comic book store in New York is advertising “cool air-conditioning and cool deals.” And, the Congregational Church in Wakefield, Mass., on its signage tells potential churchgoers they can dress casual and enjoy the sermon in air-conditioned comfort.

With so much heat, it makes sense that people selling air-conditioners are happily shipping them out the door as fast as they can. According to a projection from Planalytics, AC sales this week will be up 167 percent in the Northeast, including 189 percent in New York and 200 percent in Boston compared to a year ago.

People are buying ACs so fast, stores are running out of them. In its official blog, P.C. Richard & Son apologizes that it can no longer sell the units on the Internet but only in its stores. “Supply is limited,” it warns. At Manny’s TV & Appliances in West Springfield, Mass. a salesman says he only has a few 8,000 BTU units left “and that’s it.”

The extreme temperature ought to be good for the producers of bottled water. According to Mr. Gold’s group, this week the sales of fitness drinks, such as Gatorade, will rise 35 percent in the Northeast, including a 43 percent rise in Boston compared to year ago.

But the extremely hot weather is not entirely good, says Jane Lazgin, a spokeswoman for Nestle Waters North America in Greenwich, Conn.

“When it’s super hot people retreat inside,” she says. “But, when it’s more temperate people are out riding bikes and looking for refreshment on the go.”

Forget about the lawn

The warm weather is not particularly good for the companies that sell fertilizer, says Gold who projects a drop in sales this week of 74 percent in the Northeast after a drop of 12 percent last week.

A drop in sales might not be a surprise. According to Keri Butler, a spokeswoman for ScottsMiracle-Gro in Marysville, Ohio, the fertilizer season is in the fall before grass starts its winter hibernation. And she assures consumers those brown lawns will come back as soon as it rains.

The grass may be brown in the front lawn, but that’s not stopping the golfers.

At the North Kingston Golf Course in Davisville, R.I., the temperature was 102 degrees on Tuesday. But, the Municipal Golf Course reports it has had virtually no cancellations.

“Golfers are die hard,” says Mike Gould, a clerk at the course.

IN PICTURES: Beating the summer heat

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