Business

Sandy vs. Santa: Storm spending wreaks havoc on retail forecasts

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Hurricane Sandy may leave Santa holding the bag.

The historic storm has whipped up a wave of short-term, emergency-related consumer spending, and retail experts say its soggy aftermath could steal thunder from the crucial holiday season.

Hordes of shoppers have swarmed into supermarkets, warehouse clubs and hardware stores since last Friday, snatching up flashlights, batteries and bottled water — a tide of consumption across the Northeast that’s expected to boost economic growth in the short term.

That’s not all. Once the storm clears, they’ll be coming back for power generators, utility pumps and gasoline cans, predicts Michael Costello, president of Costello’s Ace Hardware, which operates 19 stores in Nassau and Suffolk counties on Long Island.

“There’s a frenzy out there,” Costello told The Post. “Business is only limited by the amount of product you can get into the store.”

Meanwhile, shopping malls in northern New Jersey and suburban Philadelphia looked deserted in the days leading up to Sandy’s landfall. With consumers focused on cleanup in the weeks ahead, Scott Bernhardt, president of weather consulting firm Planalytics, forecasts retailers such as Macy’s, JCPenney, Gap and J. Crew will continue to suffer.

“My list of losers is longer than my list of winners,” Bernhardt said, citing risks for sellers of apparel, toys, jewelry and sporting goods.

The stakes are high, with consumer spending driving more than two-thirds of the US economy.

The National Retail Federation has forecast a 4-percent increase in holiday sales for 2012, and devastation from Sandy could shave “as much as a full point off that number,” Bernhardt said.

The big swing factor: whether key consumer markets of the eastern seaboard are hit by floods and wind damage — and how hard.

Spending on home repairs will continue in the coming weeks as damages are assessed, said Diane Swonk, an economist at Mesirow Financial.

“That spending could borrow a bit from traditional holiday sales, depending on how much insurance is paid on those claims,” Swonk said.

If Hurricane Irene last year is any indication, adjusters will be in a Grinchy mood. Bigger deductibles in coastal areas forced homeowners to shell out more for new roofs and foundations.

Any resulting delays in home repairs could, in turn, damp hiring for construction, adding to lost jobs from small businesses hit by the storm, economists said.

But for stores in the right niche this year, Santa Claus will be coming to town.

“I’d say we’re neck-and-neck with last year, when Irene hit,” Costello said. “And Irene was our biggest, most impactful event since 1985, when [Hurricane] Gloria hit.”