SOURCE: Michigan Retailers Association

Michigan Retailers Association

April 25, 2012 14:17 ET

Michigan Retailers Association: Retail Sales, Outlook Remain Positive

LANSING, MI--(Marketwire - Apr 25, 2012) - Michigan retailers' confidence in sales over the next three months is up slightly, following March sales that remained positive, according to the latest Michigan Retail Index, a joint project of Michigan Retailers Association (MRA) and the Federal Reserve Bank of Chicago.

"Concerns over the price of gasoline haven't evaporated, but they have quieted somewhat as prices have retreated from the $4 level," said MRA President and CEO James P. Hallan. "Consumer spending also remains good, further allaying retailers' fears."

The Michigan Retail Index for March found that 49 percent of retailers increased sales over the same month last year, while 26 percent recorded declines and 25 percent saw no change. The results create a seasonally adjusted performance index of 57.8, down from 59.3 in February. A year ago March it was 42.9.

The Index gauges the performance of the state's overall retail industry, based on monthly surveys conducted by MRA and the Federal Reserve. Index values above 50 generally indicate positive activity; the higher the number, the stronger the activity.

Looking forward, 59 percent of retailers expect sales during April-June to increase over the same period last year, while 8 percent project a decrease and 33 percent no change. That puts the seasonally adjusted outlook index at 69.0, up from 67.9 in February. A year ago March it was 63.8.

Sixty-four percent of Southeast Michigan retailers increased sales in March, the best results in the state. They also are the most optimistic, with 75 percent forecasting improved 2nd Quarter sales.

National retail sales rose by 0.8 percent in March, according to the U.S. Commerce Department. Excluding cars, gas and food, sales rose 8.2 percent in the 1st Quarter, the biggest gain in two years, the government said.

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
March 2012 results
Index figures dating to July 1994 are available at http://www.retailers.com/mra/news/michigan-retail-index.html

March 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 February results)

% Increased % Decreased % No Change Index* Responses
Sales 49 (48) 26 (28) 25 (24) 57.8 (59.3) 105 (99)
Inventory 25 (28) 21 (27) 54 (45) 50.5 (57.2) 104 (98)
Prices 28 (35) 7 ( 6) 65 (59) 61.5 (64.4) 104 (98)
Promotions 22 (38) 4 ( 7) 74 (55) 60.3 (65.8) 103 (98)
Hiring 9 (18) 4 (10) 87 (72) 50.9 (55.3) 102 (97)

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 February results)

% Increased % Decreased % No Change Index* Responses
Sales 59 (61) 8 (11) 33 (28) 69.0 (67.9) 105 (99)
Inventory 37 (45) 16 (10) 47 (45) 53.7 (61.3) 103 (98)
Prices 22 (26) 9 ( 8) 69 (66) 56.0 (57.1) 103 (98)
Promotions 39 (42) 2 ( 5) 59 (53) 67.2 (65.7) 103 (96)
Hiring 15 (25) 3 ( 9) 82 (66) 53.0 (58.1) 101 (97)

March 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 44 (65) 26 ( 9) 30 (26)
West 46 (39) 18 ( 4) 36 (57)
Central 43 (64) 28 ( 7) 29 (29)
East 45 (44) 44 (11) 11 (45)
Southeast 64 (75) 25 ( 7) 11 (18)

*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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