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Forecasting A Profit
 

Weather Services Corp. has made a business, if not a science, of predicting the weather.
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A bad turn in the weather is clearly more tolerable when it isn't raining rain, you know, but raining dollar bills. At least that is the case for some 60 enterprises throughout the country. Sort of ambulance chasers of atmospheric adversity, these consulting firms are hired by such businesses as grain merchants, commodity traders, and power companies, to whom an unpleasant stretch of weather could be unexpectedly costly.

A custom forecaster with many large clients can influence swings of billions of dollars. When, for example, airplanes carrying the float of a major bank can't get back home, seven figures of daily interest can be whisked away by the storm. A manufacturer that keeps its plant open while employees are blizzard-bound can dissipate several thousands of dollars. If a construction crew's dynamite blast is set off under a temperature inversion, lawsuits may fly for miles after neighbors' windows cave in. And some retailers actually welcome the advent of storms for effective apparel advertising.

One of the oldest and most influential prognosticators is privately held Weather Services Corp. (WSC), of Bedford, Mass., founded in 1946. Back then it paid, weatherwise, to locate in New England, a meteorologically infamous spot, where the climate is as changeable as a newborn babe. Today, though, WSC could be housed in an underground silo. Over the last decade, computer meteorological modeling has rendered waving a wet finger in the air as passe as writing with a pencil. During the same 10 years, sophisticated automation and swift telecommunication have helped boost the number of WSC accounts to close to 600 throughout the world, and have raised gross sales to more than $2 million. From radio studios in its two-story Colonial-style headquarters, WSC broadcasts tailor-made spots for more than 50 stations.And in another room, it prepares the weather data for USA Today. Among prominent WSC clients paying annual fees of up to $50,000 are IBM, Union Carbide, CocaCola, Consolidated Edison, the New Jersey Turnpike, the Boston Red Sox, and the Edgartown (Mass.) Yacht Club. One private individual, an avid duck hunter, has subscribed to the service. And every so often, an executive calls to find out what the weather is like where he or she is traveling.

Despite its jealously guarded proprietary software, WSC can't do much about the fickle nature of Nature, which it predicts with "reasonable accuracy" within periods of seven days. But even with the inevitable inaccuracies ("we can always call clients back," explains WSC), the company boasts an account-renewal rate of an astounding 98%, with some clients dating back to its beginning.

One reason for such near-perfect loyalty is WSC's motto: There is no such thing as no answer. Like the weather itself, WSC's staff operates around the clock, 365 days a year, and unflaggingly will rouse a client anywhere or at any hour, if action has to be taken. Only once did WSC fall short of its pledge: The person at the other end of the telephone answered drowsily, buried the handset under the pillow, and fell back asleep.

Even if weather patterns date back to Noah, the means of sampling them do not. With its satellite dish and mainframe airs, the only familiar instrument on WSC's premises is a household thermometer. The lion's share of data is gathered from the federal National Weather Service in Maryland for free. (And WSC phone lines cost a modest $250,000 a year.) Then WSC's machines disgorge tailor-made assessments, each according to the design of the client. "The computer is changing our whole existence," says WSC vice-president George Stamos, noting that newer clients no longer want old-style general forecasts so much as precise, customized data that they can chew on themselves. "We don't need people anymore."

Even so, through the years WSC's staff has grown to more than 50, some 40 of whom are highly trained meteorologists with better things to do than fill out antiquated forms. One WSC team was contracted to observe thunder in Iran; another recently was hired to study the moisture content of clouds in Southeast Asia. No one at Weather Services Corp. is sure exactly why. But in consulting, a fee is a fee.

Last updated: Apr 1, 1985




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