Spring is around the corner, thankfully, and parts of the US that have been hit with harsh weather are seeing signs of an anticipated big thaw. But for small businesses, digging out of the financial impact of winter storms may not be quite as easy. Here at Xero, we wanted to understand just how small businesses in the Northeast fared, so we partnered with Dimensional Research to poll 200 small business owners in Connecticut, Maine, Maryland, Massachusetts, New Hampshire, New Jersey, New York, Pennsylvania, Rhode Island, and Vermont, who had experienced extreme snow, sleet or rain this winter. And to get a complementary pulse on how consumer behavior regarding small businesses might be impacted, we worked with Harris Poll to survey over five hundred consumers in the Northeast region.
The results were, in some cases, startling:
- 58 percent of small business owners said that their business was negatively impacted by the weather
- Revenue was down for a whopping 31 percent of small businesses
- Rural businesses were hit 10 percent harder than urban businesses
- According to Harris Poll, 61 percent of people surveyed said they were less likely to rely on small businesses and service providers during extreme weather
Thankfully it isn’t all doom and gloom – and the adage that necessity is the mother of invention proves to be true:
- 17 percent of small business owners said that the bad weather led them to rethink their business models, and 21 percent at least see that they need to
- 30 percent actually dreamt up new business ideas
And small business owners are just like the rest of us when it comes to dreaming of better climates when the weather turns sour: 53 percent wish they were somewhere sunnier and warmer, while 27 percent wish they could hole up at home like everyone else.
Let’s not forget how bad weather can also be a positive thing for companies that run all or most of their business online. Of the 17 percent of small business owners who reported being positively impacted by the bad weather, 13 percent said they saw an increase in online sales, and 11 percent benefitted from people looking for distractions from the weather
An uptick in online shopping as well as reliance on food delivery services seems to be a trend for consumers in the Northeast this past winter. According to the Harris Poll, 58 percent of Northeastern consumers, are more likely to use delivery services in extreme weather. Of these consumers:
- 73 percent are using take-out or meal delivery services
- 61 percent are engaging in online shopping (e.g., clothes, household goods)
So what does this all mean?
Well, for starters, ensuring your business is well prepared for Mother Nature is a smart way to go. Consult your accountant for ways to plan financially for a rainy day (or worse).
It’s one thing to have a guesstimate of how seasons impact your business, but sitting down with a financial advisor to analyze patterns of revenue and all the variables that might affect you, from shipping glitches to reductions in foot traffic, can be hugely advantageous.
We can’t predict when the worst storms will happen, but we can definitely prepare for them.