Tesco, British Grocer, Uses Weather to Predict Sales08-Sep-2009
By JULIA WERDIGIER
LONDON — Britain often conjures images of unpredictable weather, with downpours sometimes followed by sunshine within the same hour — several times a day.
Such randomness has prompted Tesco, the country’s largest grocery chain, to create its own weather team in hopes of better forecasting temperatures and how consumer demand changes with them. After three years of research, the six-person team has created its own software that calculates how shopping patterns change “for every degree of temperature and every hour of sunshine,” Tesco said last month.
Tesco expects the team’s forecasts to help it reduce costs and avoid wasting food.
Supermarkets that stock meat and other barbecue items in anticipation of sunshine are often left with unsold food if the weather turns out rainy and cold instead. A temperature increase of 18 degrees generally triples sales of barbecue meat and increases demand for lettuce by 50 percent, Tesco said.
“Rapidly changing weather can be a real challenge,” Jonathan Church, a Tesco spokesman, said in a statement. “The system successfully predicted temperature drops during July that led to a major increase in demand for soup, winter vegetables and cold-weather puddings.”
The system is part of an effort by Tesco to become more environmentally friendly. Yet some of the company’s other methods to help the environment have caused a stir. Animal rights advocates objected last month when Tesco said it was burning enough waste meat to generate electricity to power about 600 homes for a year.
Energy companies, the National Health Service and the aviation industry also use weather forecasts to prepare for demand for their services.
Tesco’s new software is based on the weather and shopping patterns of 12 British regions over the last three years.
British supermarkets were caught short on some products last month when temperatures fell below the predictions of many forecasters, including that of the Met Office, Britain’s national weather service.
After predicting a hot summer with record temperatures, the Met Office had to correct its forecast on Aug. 21, saying that there would be heavy downpours instead. More than twice the amount of rain fell in July than the long-term average. A Met Office spokeswoman, Helen Chivers, said Britain’s geographical position meant that “we get rainfall before anyone else in Europe” and because Britain gets the storms first, “they are sometimes the strongest.”