Retail to the Rescue
In the aftermath of a natural disaster, communities typically rely on government agencies, the military and local law enforcement to restore safety and stability. Recent disasters around the world, however, have demonstrated that the private sector can be just as important to the recovery process. Retailers, in particular, are nimble, resourceful and have shown that they can aid disaster response by distributing necessary supplies, offering staging areas for relief and coordinating nationwide support.
One of the reasons retailers can respond in ways that other organizations cannot is that they already have a presence near the affected area. Local retailers of all sizes possess local knowledge and have local relationships. Through these relationships, some retailers have become active participants in local emergency drills, such as California’s “Great ShakeOut,” which tests the preparedness of communities following an earthquake. These emergency exercises allow retailers to work with law enforcement and first responders to understand what their role might be in the first few hours following a disaster.
With a local presence, retailers can quickly offer shelter to victims or parking lots to relief workers. Or they can donate clothing, food, medicine or tools. After Hurricane Katrina, for example, Walmart offered its stores as shelter, provided supplies and established delivery routes to bring in critical supplies only hours after the storm. Larger retailers also have a national or worldwide support structure, so if one area has been hit, other locations can coordinate relief efforts from unaffected areas.
With their sophisticated logistical processes and distribution networks, retailers can also play a critical role in supplying hard-hit areas with life-saving necessities. An experienced retailer’s ability to get goods to stores quickly, and efficiently can come in handy in times of crisis. Unlike government organizations that have to go into unfamiliar territory and set up supply networks from scratch, retailers are skilled at acquiring and staging needed merchandise.
During Hurricane Katrina, Home Depot’s “war room” transferred high-demand items including generators, flashlights, batteries and lumber to distribution locations surrounding the hardest-hit areas. FedEx helped establish radio communication on-site for emergency responders and law enforcement. It then set up its own temporary operations at Lafayette Regional Airport to deliver much-needed supplies to New Orleans. And during relief efforts for Haiti, retailers were able to play a vital role by airlifting supplies and diverting containers on the ground or by sea to the areas where they were needed.
Harnessing Consumer Power
No other type of business has the ability to tap into a massive consumer base like retailers. Whether through brick-and-mortar locations, online stores or social networks such as Facebook and Twitter, retailers have access to people with open wallets who are willing to help.
Time and again, retailers have demonstrated their power to impact communities by collecting donations. Who has not been at the grocery store check-out and been asked to donate a dollar for charity? Retailers have also served as centers for donation drop-offs, sold fund-raising items such as CDs and apparel, and provided “disaster recovery” bins in stores so customers can purchase emergency kits ready to be delivered to people in need.
Restaurants have similarly held special events to bring in diners by offering to donate a portion of sales to a charity in need. The second largest casual dining chain, Brinker International, owner of Chili’s, On the Border Mexican Grill and Maggiano’s Little Italy, has developed processes so efficient in responding to disasters that it is able to open its restaurants within hours of a catastrophe and cook food to feed victims and relief workers. According to Bill Heine, senior director of corporate security for Brinker, this level of disaster preparedness is not only necessary to sustain business continuity but a way to give back to the community that supports its restaurants year round.
Following the earthquake in Haiti, retailers did more than just collect cash donations. They implemented creative promotions that took into account very specific needs of the victims. Duane Reade, for example, partnered with MoneyGram International to enable customers to wire funds to Haiti free of charge. Furniture retailer Relax the Back provided beds to people in Haiti through its “Buy a Bed, Give a Bed” promotion and Soles4Souls, a well-known shoe charity, teamed up with several retailers, including Foot Solutions, to collect donated shoes for victims of the quake.
Despite a tough year of declining sales and eroding profits, retailers dug deep into their pockets in early 2010. As part of their corporate social responsibility efforts, retailers donated cash and grew their charitable foundations to help the victims of the Haiti earthquake. Walmart Foundation announced it would donate $500,000 while Target met that donation and also gave one million meals to earthquake victims. Wegmans donated $100,000 through its charitable arm and Publix developed the Haiti Relief & Development Fund, channeled through the American Red Cross. Additionally, the CVS Caremark Charitable Trust announced a $175,000 donation to humanitarian organizations involved in the earthquake relief effort in Haiti.
One of the best ways retailers can help a community, region or country is to use their global influence and the power of trade to fuel long-term economic growth. In February, U.S. Trade Representative Ron Kirk unveiled Plus One for Haiti, a plan that encourages U.S. brands and retailers to help Haiti by sourcing at least 1% of their total apparel production from Haitian textile manufacturers.
“To continue to grow Haitian apparel exports and help Haiti’s economy for the long term, additional investment in and sourcing from Haiti is critical,” said Kirk. “One percent may seem small, but it means new jobs and new opportunities for the Haitian people who so desperately need forward-looking solutions in the wake of January’s devastating earthquake. And critically, a coordinated effort that promises increased sourcing can encourage investors to get Haitian factories up and running again, and provide the demand necessary to encourage expansion of apparel manufacturing capacity.”
Meanwhile, retailers that were previously sourcing products out of Haiti have taken an active role the country’s recovery. “Despite the recent devastating tragedy, we are committed to Haiti resuming its rightful place again in the sourcing community,” said Mark D’Sa, senior director of sourcing and production at Gap Inc., in a congressional testimony in March. “Our staff is working with Gap Inc.-contracted factories to facilitate a full return to business while working with the Haitian government and departments of the U.S. government to explore some of the other ways that the infrastructure might be improved in order to attract more potential investors to the country.” D’Sa also called for an amendment to current trade legislation that would allow more products from Haiti to have duty-free access into the United States, which would create more jobs in the textile industry and help improve Haiti’s overall economic picture.
The competence of retail organizations in recent emergencies has served as striking contrast to the performance of public sector agencies that at times have seemed disorganized and ineffective. By utilizing their unique expertise and the power of their consumer base, retailers have proven that they can be an integral part of any disaster preparedness or recovery effort.