Quick Stats

Quick Stats

    You are here

    KATRINA'S IMPACT--AN INDUSTRY UPDATE

    SEPTEMBER 02, 2005-- The news from New Orleans and elsewhere in Katrina's wake continued to darken yesterday. At the same time, government agencies and private companies, including many in the grocery business, continued to scramble to help those in increasingly desperate need. What follows are highlights from yesterday¿s developments, with a focus on the industry.

    SEPTEMBER 02, 2005-- The news from New Orleans and elsewhere in Katrina's wake continued to darken yesterday. At the same time, government agencies and private companies, including many in the grocery business, continued to scramble to help those in increasingly desperate need. What follows are highlights from yesterday’s developments, with a focus on the industry.

    While federal, state and local officials advanced the painful process of assessing the full extent of Hurricane Katrina's battering of New Orleans, parts of Mississippi, Louisiana and Alabama, the Agriculture Department said it will issue emergency food stamps to newly homeless Gulf Coast residents, and will speed up next month's benefits to those who already receive them.

    Much of the affected regions remained in the dark Thursday, with more than 750,000 residents still without power. More than 78,000 people were in emergency shelters in Louisiana and neighboring states, while most of the city of New Orleans--where no grocery stores are open--remained under water.


    An Impassioned Call for Help

    In a letter to "members and friends" of the National Grocers Association, J.H. "Jay" Campbell Jr., president of Associated Grocers of Louisiana, had urged the food industry "to support any agencies, such as the American Red Cross or our local Capital Area United Way, so that vital human service needs can be allocated to the areas affected by this storm."

    "Many of our independent retail customers have businesses that have been adversely affected by this terrible storm," Campbell said. "Their businesses have been closed or facilities damaged, and access not currently available for assessment or evaluation. Our retail competitors face a similar fate and concern, in that their retail locations have also been affected. The loss of retail volume in the areas affected has now been shifted to other areas of several states for an indefinite period."

    Campbell said the Baton Rouge, La.-based wholesaler will continue to do its best to service its base of independent retail grocers located in the surrounding five-state area.

    He also suggested industry members consider making an immediate donation to the newly established Baton Rouge Area Foundation, which will administer and funnel funds through two new charitable arms, the Hurricane Katrina Displaced Residents Fund and the Hurricane Katrina New Orleans Recovery Fund.


    Operators Taking Stock Amid the Destruction

    Several major retailers on Thursday issued updates concerning anticipated damages to their facilities and businesses. Whole Foods Market said it expects hurricane Katrina's impact to affect anticipated fourth quarter sales by $5 million to $6 million. The Austin-based natural foods grocer also said, however, that it was unaware of any injuries to its employees thus far.

    To help with relief efforts, Whole Foods, which operates three stores in Louisiana in New Orleans, Metairie, and Baton Rouge, will match in-store customer donations up to $1 million, which will go to the American Red Cross Disaster Relief Fund. John Mackey, Whole Foods chairman and c.e.o., said affected employees would be guaranteed jobs at other store locations.

    The Austin, Texas-based chain said it has just started the process of working with insurance companies to assess damages, a process that could take several months in the case of the New Orleans and Metairie stores.

    Supervalu Inc. said the power its Hammond, La., distribution center had remained out as of Wednesday afternoon, prompting serious concerns about food spoilage. The Eden Prairie, Minn.-based wholesaler said it was sending a generator to the warehouse. It's 10 New Orleans Save-A-Lot stores, meanwhile, remained under water.

    The company added that widespread damage to local highways was hampering efforts to deliver food to its independent accounts across the affected region. "The problem we're having is getting product in," said Jeff Noddle, Supervalu's chief executive.
    The Great Atlantic & Pacific Tea Co.'s Sav-A-Center supermarket chain, based in New Orleans, established a toll-free assistance hotline for all of its employees affected by the hurricane. The company is urging all workers to call the hotline with their current contact information, as well as any questions or concerns.

    Sav-A-Center said it would update the hotline's recorded information periodically with news on the status of its stores and other facilities, payment and other administrative issues, and ongoing relief efforts.

    Matthews, N.C.-based Family Dollar Stores, Inc. issued a statement Thursday estimating that several hundred stores in the region experienced at least some disruption as a result of the disaster. The chain said it expected that some 50 to 60 stores may remain closed for an extended period of time. However, it added that it expects comparable store sales in the five-week period ending Oct. 1, 2005, to be flat to up 2 percent vs. the similar period in the prior fiscal year.


    Grocers Continue to Spearhead Relief Efforts

    Members of the food industry from across the nation continue to heed the call to action, putting hurricane relief assistance efforts in motion.

    Pathmark Stores said it will donate much-needed product such as water and cleaning disinfectant to aid in the recovery effort along the Gulf Coast. The Carteret, N.J.-based chain also established a program for customers to contribute to the American Red Cross Hurricane Katrina Relief Fund at any of its stores.

    The Schnuck family of St. Louis and their company Schnuck Markets Inc., said they planned to donate $1 million in cash and in-kind donations to the ongoing relief effort.

    Schnucks' donations will be handled in three parts: cash, in-kind donations, and reimbursement of volunteer time. A $500,000 cash donation will be split equally between the Salvation Army and Red Cross relief efforts. An additional $250,000 will be provided in product donations (including transportation of the product), and $250,000 will be allotted for volunteer services.

    Schnucks operates stores in Mississippi, one of those hardest hit. No Schnucks stores have been directly affected by the recent onslaught of Hurricane Katrina, however, the company said.

    Indianapolis-based Marsh Supermarkets also established a relief program through all of stores in its three-state operating region, which will serve as collection points for financial contributions to assistance programs being carried out by the American Red Cross.

    Marsh shoppers will also have the opportunity to add $1 or more to their grocery bill each time they visit the store through Sept. 30. The chain is also donating supplies of non-perishable items to the Red Cross to assist with the relief efforts in collaboration with Peyton Manning, the Indianapolis Colts, and the radio station Q-95.

    On Thurs., Sept. 8, the partners will host a live auction a local radio show to raise funds for the Red Cross. The auction will include one-of-a-kind collectible items gathered and created specifically for this cause. Additionally, donation canisters will be available at Marsh's Village Pantry convenience stores, LoBill Food Stores, and O'Malia Food Markets divisions.

    "All Americans feel a deep sense of loss in the aftermath of this horrendous tragedy," said Don E. Marsh, Marsh's chairman and c.e.o. "While our thoughts and prayers continue to be with the families and friends of the victims, we encourage our patrons to join in this tangible demonstration of our sympathy and desire to help. We also want to provide support for the hundreds of service workers and volunteers who are assisting in the rescue and cleanup efforts."

    FreshDirect, the New York, N.Y.-based online fresh food manufacturing and delivery service, will also provide a way for its customers to make monetary donations to the relief efforts underway.

    Customers will be able to make donations via its Web site in increments of two dollars, with a maximum one-time donation of $10 through Sept. 14, 2005. FreshDirect pledged to keep its customer information confidential during the donation process, which will also be directed entirely to the Red Cross.

    For the entire month of September, Stew Leonard's three food stores will be collecting donations to aid victims through the company's Wishing Wells, team member contributions, and a $10,000 donation from the Stew Leonard family.

    "When news broke about the destruction and devastation Hurricane Katrina left in her wake, our team members immediately asked what they could do to help," said company spokeswoman Jill Leonard Tavello. "We wanted to take up a collection for food, blankets, toiletries and other necessities, but when we contacted organizations such as the American Red Cross and Salvation Army, they all said that monetary donations is what is really needed most right now."

    All three Stew Leonard's locations will be collecting donations for the American Red Cross Hurricane 2005 Relief for the month of September at the stores' Wishing Wells. In addition, Stew Leonard's has set up a lock box at each store where larger cash donations and checks can be dropped.

    Sunbury, Pa.-based Weis Markets, Inc. also began collecting donations chain-wide yesterday. All 157 Weis Markets stores, including its Mr. Z's, King's and Scot's Lo-Cost units, will accept donations in whatever amount customers wish to make, by adding to their grocery bills at checkout or at the customer courtesy desk. Weis said the option is available to customers paying with cash, check, and credit or debit cards.

    "These donations offer an easy and convenient way to help," said Weis Markets vice chairman Jonathan Weis. "In addition, our company will also be making a corporate donation to help the communities affected."

    Among its relief efforts, the National Restaurant Association launched a blog for Hurricane Katrina news and information at http://www.restaurant.org/katrina. NRA will update the blog several times a day with continuous informational resources for restaurant operators, as well as news and updates on how restaurants have been affected and what they are doing to aid relief efforts.

    Related Content

    Related Content