Using establishment-level data and scanner-based retail prices, we show that the number of firms declines and local retail prices rise in counties affected by natural disasters. Price increases are particularly pronounced for essential goods and low-priced products, as well as in counties with fewer bank branches per capita, where fewer firms enter following natural disasters. The effects extend beyond retailers: large producers affected by natural disasters raise prices, especially when many of their competitors are also affected, while smaller producers do not. Consistent with these pricing patterns, large firms experience increases in sales and profits following natural disasters. Our results suggest that the costs of climate-related disasters, which are increasingly frequent negative realizations of physical risk, are ultimately borne by consumers, while large firms benefit from the redistribution of market shares.