Summer 2019 was hot, and not just for those of us with window AC units. Millions of people across the United States were affected by heat waves and abnormally high heat indexes. As we transition into fall and temperatures begin to cool, the Farmers’ Almanac is warning of a colder-than-average winter. However, these abnormal weather patterns aren’t just a concern for meteorologists. In addition to posing personal and environmental risks, extreme weather patterns pose a major risk to your restaurant’s revenue.
One, maybe unexpected, way extreme weather affects restaurant revenue is through an increase in food prices, which eats away at your profit. Heatwaves cause food losses due to drought, while more humid weather damages food supplies with mold. On the other hand, fall crops suffer shortages when cold weather arrives too early in their growing period. When crops are more difficult to grow, harvest, and sell, prices increase to meet demand. Furthermore, extreme weather can strain the delivery link from the farm to the restaurant.
Extreme weather effects aren’t limited to produce. Poultry and livestock have been shown to suffer from heat stress under warmer-than-average conditions. This results in lowered appetites, fertility, and productivity, causing food shortages. Food supply is also limited by disease, of which animals suffering from heat stress are at higher risk. As with produce, a decrease in supply is accompanied by increases in demand and price — and a decrease in profit.
Weather can also impact restaurant revenue by affecting customers’ attitudes. Recent research shows a relationship between the weather and negative restaurant reviews, as patrons were three times as likely to leave a negative review on a rainy day. Not only does a bad review make it unlikely that the author will return
Perhaps one of the biggest extreme weather threats to restaurant revenue, however, is the risk of damage to storefront and food supply. Weather events such as blizzards and rainstorms can cause significant damage to property, while weather-related power outages can cost a restaurant hundreds in supplies if food goes bad. If a restaurant doesn’t have proper coverage, the costs of these damages will directly impact their bottom line.
Luckily, coverage exists for this! Make sure that your restaurant is protected against weather-related incidents. Schedule a free consultation with one of Bikelane’s Restaurant Insurance Experts today.