LANSING, MI--(Marketwire - December 27, 2006) - Despite a stronger start to the holiday
shopping season, Michigan retailers appear less optimistic about the start
of the new year, according to the latest Michigan Retail Index survey by
the Michigan Retailers Association and Federal Reserve Bank of Chicago.
The sales performance component of the November index jumped nearly five
points from last year and more than six points over October, indicating a
solid beginning for holiday sales. But retailers' sales outlook for the
next three months dropped nearly seven points from a month earlier and more
than 11 points from a year ago.
December's Michigan Retail Index reporting sales for the entire holiday
season will be available January 24. Retailers went into this season
projecting, on average, a 4.5-percent gain.
"It's a long season, with many twists and turns, and it runs to the end of
the year. But now we have data confirming it started well," said MRA
Chairman and CEO Larry Meyer.
"It's also not surprising that retailers are tempering their outlook for
the start of the new year, given economists' predictions that Michigan's
economy won't improve in the immediate future."
The Index showed that 41 percent of retailers increased sales in November
over the same month last year, while 43 percent recorded declines and 16
percent saw no change. The results create a seasonally adjusted performance
index of 50.4, up from 44.2 in October.
In addition, 41 percent believe their sales will increase for
December-February, while 34 percent forecast declines and 25 percent
project no change. The results create a seasonally adjusted outlook index
of 62.4, down from 69.3 in October.
The Michigan Retailers Association is the unified voice of retailing in
Michigan and the nation's largest state trade association of general
merchandise retailers.
Note: William Strauss, Senior Economist and Economic Advisor with the
Federal Reserve Bank of Chicago, can be reached at 312.322.8151.
Michigan Retailers Association/Federal Reserve Bank of Chicago
Michigan Retail Index
November 2006 results
Index figures dating to July 1994 are available at
www.retailers.com/news/retailindex.html
November Performance
Retailers reporting increased, decreased or unchanged sales, inventory,
prices, promotions and hiring compared to the same month a year ago
(numbers in parentheses indicate October results)
% Increased % Decreased % No Change Index* Responses
Sales 41 (36) 43 (48) 16 (16) 50.4 (44.2) 207 (211)
Inventory 34 (36) 33 (28) 33 (36) 63.4 (50.2) 206 (208)
Prices 36 (35) 16 (10) 48 (55) 62.2 (64.0) 208 (208)
Promotions 31 (40) 12 ( 6) 57 (54) 58.8 (64.2) 208 (209)
Hiring 9 (15) 14 (10) 77 (75) 48.8 (52.5) 206 (210)
Outlook for Next 3 Months
Retailers expecting increased, decreased or unchanged sales, inventory,
prices, promotions and hiring compared to the same period a year ago
(numbers in parentheses indicate October results)
% Increased % Decreased % No Change Index* Responses
Sales 41 (48) 34 (25) 25 (27) 62.4 (69.3) 205 (206)
Inventory 16 (27) 47 (41) 37 (32) 42.0 (59.7) 204 (204)
Prices 39 (35) 11 ( 7) 50 (58) 64.7 (63.4) 204 (206)
Promotions 30 (44) 19 ( 5) 51 (51) 60.3 (73.3) 204 (207)
Hiring 10 (13) 21 (13) 69 (74) 47.4 (50.8) 204 (206)
November Sales Performance & Outlook
for Next 3 Months, by Region
(the first number indicates sales performance for the month; the number in
parentheses indicates outlook for the next three months)
% Increased % Decreased % No Change
North 49 (42) 39 (37) 12 (21)
West 37 (37) 40 (29) 23 (34)
Central 41 (62) 41 (11) 18 (27)
East 33 (39) 39 (33) 28 (28)
Southeast 42 (33) 47 (40) 11 (27)
Question of the Month
Relative to last year, how are your margins on holiday merchandise this
season?
Larger Smaller Same
17.8% 31.1% 51%
*Seasonally adjusted diffusion index. A diffusion index, which is the sum
of the percent of respondents indicating increase and half the percent
indicating no change, is calculated and then seasonally adjusted using the
U.S. Census Bureau's X-11 Seasonal Adjustment procedure. Index values above
50 generally indicate an increase in activity, while values below 50
indicate a decrease.
Contact Information: Contact:
Tom Scott
517.372.5656
Email Contact