WWD.com/business-news/financial/gustav-hits-the-gulf-coast-1732677/
government-trade
government-trade

Gustav Hits the Gulf Coast

Retailers Prepared for Hurricane Gustav.

NEW ORLEANS — With the onslaught of Hurricane Gustav nearly three years to the day after Hurricane Katrina, retailers at press time Monday were in an anxious watch-and-wait mode as most monitored the storm hundreds of miles from the city after the mayor called for a mandatory evacuation.

This story first appeared in the September 2, 2008 issue of WWD.  Subscribe Today.

Many had put in place communications strategies and looting precautions — lessons learned from the impact of Katrina.

At Canal Place, the city’s premier shopping center a stone’s throw from the Mississippi River, Carla Adams, director of marketing, said she had no reports of damage so far. “As of now, all is well,” she told WWD. Prior to evacuating, the center’s 200 employees were directed for updates to a Web site with emergency information, and tight security was on site, Adams said.

An airtight communications system initiated after Katrina was also in place for Lakeside Shopping Center, said Tricia Thriffiley, director of marketing for the 1.1 million-square-foot mall in suburban New Orleans.

“We set up a third-party e-mail account that allows our corporate offices to interact with our 120 merchants’ corporate offices, as well as with employees,” she said, adding the mall’s general manager, Glen Wilson, was on-site, along with the construction manager and security and maintenance crews.

At Rubenstein’s, the iconic men’s and women’s store in downtown New Orleans, David Rubenstein remained at home due, in part, because his daughter Allison Marshall was expected to give birth in the next 18 hours. “You don’t want to be on the road for that,” he said, referring to the 10-12 hour traffic delays reported by people evacuating the city. “We opted to stay near the hospital.”

At the store, sandbags were placed along the exterior walls to prevent flooding on the ground floor, while the store’s plate-glass windows were protected by overhanging balconies, he said. He hoped to make a reconnaissance run later Monday as the storm subsided, and Rubenstein expected to open as early as Wednesday, depending on the return of evacuated employees. After Katrina, Rubenstein’s was among the first retailers to reopen in the city.

Like most retailers, Rubenstein said Gustav and the accompanying evacuation of the city will put a dent in sales. Last week, the store experienced a dramatic slowdown while the city prepared for evacuation, and this week returning residents will be restocking “grocery and liquor” supplies, he joked. “After that, we hope people will be getting back to business.”

The slowdown may prompt the store to discontinue its women’s clothing business, which has represented 15 percent of overall sales, he said. The move had been under consideration, but “the hurricane may precipitate the decision,” he said.

Along trendy Magazine Street in the Uptown part of the city, boutiques were shuttered. Frock Candy co-owners and sisters Dora Cullen and Popi Nicopoulos closed Friday afternoon in anticipation of the storm. “We put our hurricane preparedness into action with double checking cell phone lists and backing up computer data,” Nicopoulos said. She hopes to reopen the office Thursday, and the store a few days later depending on employees’ availability.

The return to business this fall will hopefully put an end to a summer slowdown, Nicopoulos said. “We’ve reduced buying by about 20 percent and we’re more selective about merchandise we do buy,” she said. “We hope this hurricane is just a small blip.”

At General Growth Properties, with two operations in the metropolitan New Orleans area and one in Baton Rouge, a spokesman said the concern was first with the safety of employees. The near-term return of business of the properties — New Orleans’ Oakwood Shopping Center and Riverwalk Marketplace and Mall of Louisiana in Baton Rouge — has not yet been determined, he said. “We’ll reopen when we are certain that it is safe to do so,” he said.

A spokeswoman for Wal-Mart said about 100 stores were closed in the gulf region, mostly in Louisiana, Mississippi and Texas.

“Right at this point, our main concern is the safety of our customers and community. When the storm is over, we’ll be able to go back and assess the damage. But our primary concern right now is the safety of our associates and customers in the area,” she said.

As for when the company would reopen those stores, the Wal-Mart spokeswoman said, “We’ll deal with that when the time comes. We do want our communities to get back to normal as soon as possible, but with damage and power, there’s so many factors that it’s still kind of wait and watch.”

Macy’s evacuated the construction sites for two New Orleans stores preparing for a grand opening Oct. 25. Esplanade, an existing store in Kenner, close to downtown, is being rebuilt. The second is a new store in Lakeside Shopping Center in Metairie, a suburb. The stores were in late-stage construction, working on interiors.

Macy’s has three existing Louisiana stores, two in Baton Rouge that closed Sunday and Monday, and a store in Lafayette, which closed early Saturday and remained closed through Monday. Macy’s Beaumont, Tex., store closed early Saturday night and remained closed Monday.

“We did this first and foremost so our associates could do what they needed to do to keep their families safe and to protect themselves,” said a Macy’s spokesman.

“At this point we don’t know when we’ll reopen. We’ll monitor and when it’s safe and prudent, we will,” he added.

Target closed 12 stores, 10 in Louisiana and two in Texas.

“By Friday, about 75 percent of our team members had evacuated the Slidell and Covington, La., areas. By Saturday that number had jumped to 90 percent,” said a Target spokeswoman.

The spokeswoman said that Target has been monitoring the storm all week. “We have a command center at headquarters [in Minnesota]. We have a meteorologist on call. Every piece of the business is represented in this room,” she said, adding that the discounter is also monitoring Hurricane Hanna off the coast of Florida and dealing with the Republican National Convention being in town in Minneapolis.

“What we certainly learned from Katrina is the importance of rally stores — the places people go after they’ve evacuated — and to have those staffed with team members and the right merchandise,” the Target spokeswoman said, explaining that the “right merchandise” includes toiletries, batteries, etc.

Target donated more than $300,000 in product relief packages in partnership with the Red Cross.