LANSING, MI -- (MARKET WIRE) -- January 24, 2007 -- Michigan retailers are restrained in their 1st
Quarter sales projections, following a generally soft holiday season.
Although retailers' three-month outlook remains positive, their level of
optimism is the lowest in four months, according to the Michigan Retail
Index, a joint project of Michigan Retailers Association and the Federal
Reserve Bank of Chicago.
Holiday sales were disappointing for the majority of retailers. They went
into the season expecting, on average, a 4.5-percent gain, but 51 percent
saw sales decline and another 10 percent reported sales unchanged from the
previous year.
On a more positive note, nearly a quarter of the industry -- 23 percent --
rang up holiday sales greater than 5 percent, while another 16 percent
recorded increases of 0-5 percent.
In addition, retailers posted better numbers for all of 2006. Forty-eight
percent recorded gains for the year while 45 percent reported declines and
7 percent were unchanged. Nearly a quarter of the industry -- 23 percent --
racked up annual gains greater than 5 percent.
"The holiday season started strong but fell off in December," said MRA
Chairman and CEO Larry Meyer. "Fortunately, more retailers posted better
numbers for the entire year."
The Index showed 39 percent of retailers increased sales in December over
the same month last year, while 47 percent recorded declines and 14 percent
saw no change. The results create a seasonally adjusted performance index
of 48, down from 50.4 in November.
In addition, 43 percent believe their sales will increase for
January-March, while 30 percent forecast declines and 27 percent project no
change. The results create a seasonally adjusted outlook index of 62.2,
down from 62.4 in November.
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
December 2006 results
Index figures dating to July 1994 are available at
www.retailers.com/news/retailindex.html
December 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 November results)
% Increased % Decreased % No Change Index* Responses
Sales 39 (41) 47 (43) 14 (16) 48.0 (50.4) 207 (207)
Inventory 30 (34) 36 (33) 34 (33) 58.6 (63.4) 199 (206)
Prices 41 (36) 8 (16) 51 (48) 64.7 (62.2) 200 (208)
Promotions 37 (31) 11 (12) 52 (57) 62.7 (58.8) 201 (208)
Hiring 9 ( 9) 16 (14) 75 (77) 47.4 (48.8) 195 (206)
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 November results)
% Increased % Decreased % No Change Index* Responses
Sales 43 (41) 30 (34) 27 (25) 62.2 (62.4) 204 (205)
Inventory 24 (16) 32 (47) 44 (37) 49.9 (42.0) 199 (204)
Prices 37 (39) 9 (11) 54 (50) 65.2 (64.7) 200 (204)
Promotions 39 (30) 13 (19) 48 (51) 67.6 (60.3) 201 (204)
Hiring 9 (10) 13 (21) 78 (69) 51.9 (47.4) 197 (204)
December 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 (31) 44 (36) 12 (33)
West 35 (50) 54 (19) 11 (31)
Central 17 (30) 53 (33) 30 (37)
East 46 (69) 39 (23) 15 ( 8)
Southeast 47 (43) 44 (37) 9 (20)
Question of the Month
For sales this past holiday season, what was the percentage increase or
decrease from the previous season?
< -5% -5...< 0% 0% 0 >...5% > 5%
34.1% 16.5% 10.4% 15.9% 23.1%
For sales for all of 2006, what was the percentage increase or decrease
from the previous year?
< -5% -5...< 0% 0% 0 >...5% > 5%
29.9% 15.2% 7.1% 24.4% 23.4%
Contact Information: Contact:
Tom Scott
517.372.5656
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