What Ebola fears mean for business

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Consumers fear Ebola can’t be contained. But as health care providers try to prevent hysteria, the virus will undoubtedly produce winners and losers throughout the economy.

Winners? Yes, winners. Retailers like Wal-Mart and Target are expected to benefit from a spike in sales of germ-fighting agents such as hand sanitizers and disposable hand wipes, as people seek to increase their protection again both Ebola and the winter cold and flu season, experts say.

People can only get Ebola through direct contact with the bodily fluids from infected patients, according to the World Health Organization. There’s no evidence that the virus can be spread by exposed people who have no symptoms.

Though the virus has killed more than 4,500 in West Africa, only three cases have been diagnosed in the United States, and specifically, in Dallas. Nevertheless, the 2009 swine flu outbreak prompted sales of hand sanitizer to soar by more than 70 percent for the 52-week period, to a peak of $350 million nationwide, said Shannon Romanowski, senior beauty and personal care analyst at Chicago-based Mintel, a consumer trend and market research firm.

“We typically see antibacterial and germ protection product sales spike when there are epidemics,” she said. “When people are scared of flu and disease outbreaks, we see that correlate with sales in germ protection products. I would expect retailers to tap into that fear; they increase their displays and promotions [for those products].”

Wal-Mart and Target account for a majority of those sales, though drugstores benefit, too, she said.

Survival gear sales soar on Ebola fears

Other beneficiaries are the makers of sanitizing products, such as Lysol, owned by British company RB PLC; Germ-X, owned by St. Louis-based Vi-Jon Laboratories, and Purell, owned by Akron, Ohio-based Gojo Industries, Romanowski said.

For the four weeks ended Oct. 5, hand-sanitizer sales have increased 9.4 percent from the same period a year ago, to $18 million, according to the most recent data from Chicago-based research firm IRI.

Airlines face a mixed outlook, with experts worried that travelers will cancel trips due to the Ebola scare but also aware that cheaper oil prices likely will help boost airline carriers’ profits.

Jean Medina, spokeswoman for airlines lobbying group Airlines for America, said only about 150 people a day travel from the Ebola-affected countries on foreign air carriers, out of about 2 million who fly on domestic and international flights that U.S. airlines operate.

“It’s not an airborne disease,” she said, “and the five airports in the United States with additional screening capture more than 90 percent of the people who travel through those regions [Liberia, Guinea and Sierra Leone].”

African tour operator Lisa Greyhill, president of the Adventure Travelers Society, in Clarendon Hills, said her customers are sophisticated enough to understand that the safaris and mountain gorilla trekking trips she arranges are concentrated in eastern and southern Africa, and she has had no cancellations.

Indeed, she said one client booked a trip to southern Africa on Monday to show solidarity with the folks there.

Viking Travel Service, a locally owned, high-end travel agency, has no trips scheduled to Western Africa, and wouldn’t send anyone to an Ebola-stricken territory because of the danger it would pose, said Richard Haymaker, the company’s director of special projects and faith-based travel.

Haymaker said one person on a group tour asked whether tour insurance covered medical costs, and the answer is that tour insurance has nothing to do with health care coverage.

If people decide to take greater travel precautions, the beneficiaries may be car-rental companies and local resorts because Chicagoans may choose to drive to Lake Geneva instead of chancing travel through a hub airport to an overseas destination, said Scott Hegerty, assistant professor of economics at Northeastern Illinois University in Chicago.

“The risk is in the fear. I can see people going local for food and for vacation,” he said.

Farmers in Africa are harvesting cocoa at the height of the season but holding their breath that the virus doesn’t spread to the Ivory Coast, the world’s No. 1 grower, said Jack Scoville, vice president of Price Futures Group, a futures broker at the Chicago Board of Trade.

Cocoa prices have stabilized at $3,125 a ton, down from $3,399 when the Ebola virus first became public, he said.

Companies with major stakes in the chocolate-making market, such as locally based Mondelez International, Blommer Chocolate, Cargill and Archer Daniels Midland, as well as Mars, Hershey, Nestle, and Olam International, have donated a total of $700,000 through the World Cocoa Foundation to help educate people and provide care in West Africa in hopes of preventing the disease’s spread, according to the cocoa foundation.

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