LANSING, MI--(Marketwire - September 23, 2010) - More Michigan retailers saw improved sales during August, but they also became more cautious about the next three months.
The Michigan Retail Index, a joint project of Michigan Retailers Association (MRA) and the Federal Reserve Bank of Chicago, found that as many retailers posted sales increases as decreases during August -- the first time since April that decreases didn't outnumber gains. Their projections for the next three months, however, fell to the year's lowest level of expectations for better sales.
"More retailers posted sales increases in August than in May, June or July, which was a good way to come out of summer. But they are being cautious as they approach the fall and early holiday shopping, waiting for some momentum to develop and demonstrate these gains can be sustained," said James P. Hallan, MRA president and chief executive officer.
Retail sales also rose nationally in August, according to the U.S. Commerce Department. Economists predict sales will continue to rise at a modest level in the short term as careful consumers hunt chiefly for bargains in addition to basic necessities.
The Michigan Retail Index survey for August found that 43 percent of retailers increased sales over the same month last year, while 43 percent recorded declines and 14 percent saw no change. The results create a seasonally adjusted performance index of 46.9, up from 42.4 in July. A year ago August, the sales performance index stood at 46.6.
Index values below 50 generally indicate a decrease in overall retail activity.
Looking ahead, 42 percent of retailers expect sales during the September-November period to improve over the same period last year, while 27 percent project a decrease and 31 percent no change. That puts the seasonally adjusted outlook index at 51.9, down from 62.3 in July. A year ago August, the sales outlook index stood at 53.5.
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
August 2010 results
Index figures dating to July 1994 are available at www.retailers.com/news/retailindex.html
| August 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 July results) | |||||
| % Increased | % Decreased | % No Change | Index* | Responses | |
| Sales | 43 (39) | 43 (45) | 14 (16) | 46.9 (42.4) | 84 (106) |
| Inventory | 41 (35) | 25 (26) | 34 (39) | 52.4 (52.1) | 83 (104) |
| Prices | 23 (28) | 10 (11) | 67 (61) | 55.2 (59.5) | 82 (104) |
| Promotions | 25 (32) | 15 ( 4) | 60 (64) | 56.7 (64.0) | 83 (104) |
| Hiring | 7 (12) | 15 (15) | 78 (73) | 43.7 (45.3) | 83 (101) |
| 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 July results) | |||||
| % Increased | % Decreased | % No Change | Index* | Responses | |
| Sales | 42 (49) | 27 (20) | 31 (31) | 51.9 (62.3) | 84 (106) |
| Inventory | 37 (37) | 28 (17) | 35 (46) | 48.8 (55.0) | 83 (104) |
| Prices | 24 (25) | 6 ( 5) | 70 (70) | 58.9 (60.2) | 83 (104) |
| Promotions | 43 (38) | 11 ( 7) | 46 (55) | 61.8 (67.4) | 82 (104) |
| Hiring | 5 (11) | 7 (10) | 88 (79) | 46.3 (49.4) | 82 (104) |
| August 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 | 60 (34) | 20 (53) | 20 (13) |
| West | 32 (21) | 47 (37) | 21 (42) |
| Central | 41 (53) | 41 (18) | 18 (29) |
| East | 29 (14) | 57 (29) | 14 (57) |
| Southeast | 41 (59) | 55 ( 9) | 4 (32) |
Question of the Month
Compared to last year, how are your back-to-school sales?
| Much better | A little better | Same | A little worse | Much worse |
| 6% | 12% | 38% | 28% | 16% |
*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