Storm eventually may boost demand
Clint Engel -- Furniture Today, November 5, 2012
NEW YORK - It's not something many want to talk about right now, but if history repeats itself, furniture stores stung by Hurricane Sandy and struggling to get back on their feet may soon be struggling to meet a huge influx in demand.
"Every store is closed. Every business is closed because there's no electricity unless they have generators," said Julius Feinblum, CEO of industry real estate specialist Julius M. Feinblum Real Estate of Plainview, N.Y.
"But the good news is that within a month or so, (consumers will) have to replace," he said. The most immediate home furnishings need will be mattresses, followed by living room furniture and carpeting, he said.
Feinblum said one simply needs to look to Florida and the boom that followed Hurricane Andrew in 1992 to get a feel for what's coming. The same thing happened in the New Orleans area after Hurricane Katrina in 2005.
"There's a tremendous amount of replacement business funded by the (Federal Emergency Management Agency), funded by insurance and funded by the people who need to buy," Feinblum said.
"So I would say at the end of the day, we're one of the few businesses that will actually benefit from (the storm), but in the interim, it's disaster," he said.
Ken Smith, managing partner of accounting and consulting firm Smith Leonard in High Point, which has a number of industry clients, agreed "that business does pick up in certain places where disasters hit." But he added that during the storm and cleanup, "there is nothing being sold."
"Then people have to wait on insurance in many cases, or wait for homes to be rebuilt. So it doesn't come all at once," he said.
All of this is far from the mind of some affected retailers, including Raymour & Flanigan's Neil Goldberg.
"At this point, the continuity of our business and being able to take care of our own people and our customers is frankly more important than any kind of downstream possible increase in business or benefit," he said.
"We'll work our way through it. As long as everybody is safe and sound, the loss of property will be repaired and the loss of business will someday be forgotten."