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Katrina Related Power Outages, Flooding Force Store Closings

9/01/2005 11:48:00 AM Eastern

New Orleans — Hundreds of retail stores in Louisiana, Mississippi and Alabama that carry consumer electronics and major appliances remained closed last week in the aftermath of Hurricane Katrina, although dealers contacted by TWICE reported no employee deaths or injuries from the storm.

While most of the closings were due to power outages, a RadioShack spokesperson indicated that at least five of its stores were completely destroyed, including a waterfront location in Biloxi, Miss.

Retailers said many locations are also flooded or remain inaccessible, with poor communications further hampering store assessments. Widespread looting has added to the damage, according to news reports.

Among the chains affected, Wal-Mart said that 126 Wal-Mart and Sam’s Club locations — representing over 3 percent of its total U.S. store base — plus two distribution centers remained closed immediately following the storm, with 97 of the closings attributed to power outages.

More than 80 of those facilities have since been reopened, the company reported, although about 1 percent of its U.S. store base was still closed at press time.

Besides RadioShack’s five lost stores, at least another 100 locations remained closed. “We’re working as swiftly as we can for a more accurate count,” the spokesperson said.

Best Buy told TWICE that 15 stores in Alabama, Florida, Louisiana and Mississippi were immediately affected by Katrina, and that seven — one each in Houma, La., and Jackson and Hattiesburg, Miss., plus four in and around New Orleans — were still closed last week due to interruptions in phone or electric service or inaccessibility. “We still haven’t been able to assess damage to some of the stores,” a spokesperson said, “and will reopen when the environment is safe.”

Circuit City said that 10 stores remained shut as of last Thursday, including seven in Louisiana and three in Mississippi. Like Wal-Mart, most of the closures were due to power outages, a spokesperson told TWICE, although three stores in New Orleans were still inaccessible last week.

Texas and Louisiana chain Conn’s temporarily closed four stores “on the western edge of the storm” which had lost power, chairman/CEO Tom Frank said. The stores sustained no damage and all have since been reopened, although two were relying on backup generators. “Many of our stores are located on the Gulf and are equipped with large standby emergency generators,” he said.

Rex, which has stores throughout the Gulf Coast states, said 12 locations remained closed. “We don’t know if there’s major damage yet,” said chairman/CEO Stuart Rose. “We hope to get these stores open soon [for humanitarian reasons] because they have refrigerators that people will need to replace.”

At press time, power and phones were still out at the home office of Cowboy Maloney’s Electric City, the Jackson, Miss.-based independent dealer. Bill Trawick, president and executive director of NATM Buying Corp., the chain’s buying group, reported that the Maloney’s headquarters, distribution center and computer system were not damaged, although several coastal stores, including its Gulfport and Biloxi, Miss., locations, were either flooded or inaccessible due to local evacuations. No employees were injured.

Trawick experienced the impact of flooding first hand while working at Conn’s. “What you lose, you make back” after the insurance checks arrive and customers replace their damaged appliances and TVs, he said. “But nobody wants to go through that.”

The hurricane will also force the Nationwide Marketing Group to make alternative plans for its February 2006 convention, which was to be held in the Louisiana Superdome in New Orleans. No decisions have been made at this point, a spokesperson said.

Ed Kelly, Nationwide’s president, said the group has been unable to contact most of its member dealers in affected areas. “The devastation is just so massive,” he said. “We are keeping everyone in our prayers.” Division leaders who managed to reach Gulf area store owners reported that all had safely evacuated the region, although none knew “if they will even have a business to go back to,” the spokesperson said.

On the vendor side, Richard Gray Power Company, a New Orleans-based maker of power delivery systems for home theaters, has moved operations to its manufacturing facility in Chicago. The company is still shipping orders, but president Dick McCarthy has asked customers to allow an additional 24 hours for processing.

Separately, Wal-Mart, The Home Depot, Lowe’s, Office Depot and Best Buy’s Children’s Foundation each pledged up to $1 million toward disaster relief. Best Buy is also offering its employees the resources of the company’s Schulze Family Fund.

In addition, Home Depot has mobilized thousands of staffers from across the country to man its Gulf area stores. State officials have granted store personnel access to Interstate 10, the region’s main corridor, ahead of the public in order to stock shelves with needed supplies based on three years of hurricane sales data, the company said.

Cingular Wireless has also set up free emergency calling stations at its open company-owned stores across Alabama, Mississippi and Louisiana. The calling stations are available to anyone who simply needs to use a phone, the company said.

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