LANSING, MI--(Marketwire - November 24, 2010) - Heading into Friday's "official" start of holiday shopping, the table is set for a better season.
Retailers' optimism during October rose to its highest level in six months on the strength of generally improved sales during August through October, according to the Michigan Retail Index survey, a joint project of Michigan Retailers Association (MRA) and the Federal Reserve Bank of Chicago.
"Michigan retailers are looking forward to this season with enthusiasm and expect it to be the best in several years," said James P. Hallan, MRA president and chief executive officer. "They're coming off three months of relatively good sales and seeing some improvement in the economy."
October's monthly survey supported the previous month's findings, in which most Michigan retailers -- 58 percent -- said they expect better sales this holiday season. On average, they projected a 6 percent gain in sales over last year -- the best since 2004.
U.S. holiday sales forecasts include 2.3 percent by the National Retail Federation and upwards of 3.5 percent by the International Council of Shopping Centers.
The Michigan Retail Index survey for October found that 41 percent of retailers increased sales over the same month last year, while 39 percent recorded declines and 20 percent saw no change. The results create a seasonally adjusted performance index of 51.0, down from 56.7 in September, but still above the 50 mark. Index values above 50 generally indicate an increase in overall retail activity. A year ago October, the sales performance index was 41.4.
Looking ahead, 53 percent of retailers expect sales during November-January to increase over the same period last year, while 15 percent project a decrease and 32 percent no change. That puts the seasonally adjusted outlook index at 67.4, up from 56.3 in September. A year ago October, the sales outlook index stood at 48.9.
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 2010 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 | 41 (41) | 39 (36) | 20 (23) | 51.0 (56.7) | 123 (120) | |
| Inventory | 38 (23) | 18 (33) | 44 (44) | 53.2 (44.4) | 122 (119) | |
| Prices | 30 (19) | 10 (8) | 60 (73) | 60.3 (55.4) | 122 (119) | |
| Promotions | 40 (31) | 7 (8) | 53 (61) | 64.2 (64.0) | 122 (120) | |
| Hiring | 11 (10) | 10 (12) | 79 (78) | 49.1 (49.0) | 121 (120) |
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 | 53 (43) | 15 (28) | 32 (29) | 67.4 (56.3) | 124 (120) | |
| Inventory | 28 (23) | 26 (28) | 46 (49) | 55.6 (47.0) | 122 (119) | |
| Prices | 30 (23) | 8 (7) | 62 (70) | 61.5 (58.4) | 122 (119) | |
| Promotions | 44 (38) | 5 (8) | 51 (54) | 67.5 (63.8) | 121 (120) | |
| Hiring | 9 (7) | 10 (11) | 81 (82) | 48.6 (46.3) | 121 (119) |
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 | 48 (36) | 36 (36) | 16 (28) |
| West | 32 (57) | 38 (17) | 30 (26) |
| Central | 63 (63) | 31 (12) | 6 (25) |
| East | 45 (22) | 33 (11) | 22 (67) |
| Southeast | 27 (67) | 55 (3) | 18 (30) |
Question of the Month
Compared to last year, when did you start (or plan to start) your holiday promotions?
| Earlier | Same | Later |
| 14% | 81% | 5% |
*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