SOURCE: Michigan Retailers Association

Michigan Retailers Association

November 25, 2009 08:00 ET

Retailers Ready for Michigan Shopping Day, According to Michigan Retail Index Survey

LANSING, MI--(Marketwire - November 25, 2009) - Michigan retailers enter the big Michigan Shopping Day weekend with greater optimism and an earlier schedule of promotions to attract holiday shoppers.

According to the latest Michigan Retail Index survey, a joint project of Michigan Retailers Association (MRA) and the Federal Reserve Bank of Chicago, nearly one fourth of retailers, 23 percent, said they started their holiday promotions earlier this year than last, continuing a trend of recent years. Only 2 percent said they started later.

"Michigan Shopping Day marks the official start of the holiday shopping season, but retailers have been holding special holiday promotions for several weeks already," said MRA President and CEO James P. Hallan. "It's all about getting the season off to the best start possible by attracting early shoppers."

Nearly two-thirds, 64 percent, of retailers said in a previous survey that they expect their sales for the season to be as good or better than last year, with most of those respondents forecasting increases.

Hallan said optimism springs from a more stable national economy and improvements in the auto industry and the financial, housing and stock markets. "While higher unemployment is a challenge this year, the overall economy is on a firmer foundation than last year, when we entered the holiday season after nearly falling off a cliff."

The Michigan Retail Index survey for October found that 35 percent of retailers increased sales over the same month last year, while 51 percent recorded declines and 14 percent saw no change. The results create a seasonally adjusted performance index of 41.4, down from 42.5 in September. A year ago the index had dropped to 34.9 in October and 28.8 in November.

Looking ahead, 37 percent of retailers expect sales during the November - January to improve over the same period last year, while 35 percent project a decrease and 28 percent no change. That puts the seasonally adjusted outlook index at 48.9, down from 49.2 in September.

Note: William Strauss, Senior Economist and Economic Advisor with the Federal Reserve Bank of Chicago, can be reached at 312.322.8151.

Michigan Retail Index
October 2009 results
Index figures dating to July 1994 are available at
www.retailers.com/news/retailindex.html

October 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 September results)

            % Increased   % Decreased   % No Change    Index*     Responses
Sales          35 (35)       51 (49)      14 (16)    41.4 (42.5)  129 (135)
Inventory      23 (19)       40 (47)      37 (34)    37.5 (33.2)  128 (135)
Prices         23 (19)        9 (13)      68 (68)    56.4 (52.8)  128 (134)
Promotions     44 (36)        5  (7)      51 (57)    67.8 (62.5)  128 (135)
Hiring          9  (7)       16 (17)      75 (76)    45.9 (44.6)  127 (135)


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 September results)

            % Increased   % Decreased   % No Change    Index*     Responses
Sales          37 (38)       35 (36)      28 (26)    48.9 (49.2)  128 (137)
Inventory      17 (20)       41 (36)      42 (44)    41.0 (44.5)  126 (135)
Prices         27 (21)       11  (9)      62 (70)    57.5 (55.5)  127 (135)
Promotions     48 (48)        6  (5)      46 (47)    66.8 (67.6)  126 (135)
Hiring         10 (11)       11 (14)      79 (75)    48.9 (48.1)  127 (132)


October 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          39 (30)       58 (47)       3 (23)
West           42 (45)       42 (19)      16 (36)
Central        35 (40)       40 (40)      25 (20)
East           20 (10)       70 (50)      10 (40)
Southeast      29 (42)       61 (35)      10 (23)


Question of the Month
Relative to last year, when did you plan to start your holiday promotions?

            Earlier       Later         Same
              23%           2%           75%

*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.

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