Michigan Retailers Project Sales Growth

LANSING, MI--(Marketwire - Feb 27, 2013) - Four out of five Michigan retailers expect to increase sales this year, most by mid-single digits, according to the Michigan Retail Index, a joint project of Michigan Retailers Association (MRA) and the Federal Reserve Bank of Chicago.

Coming off a positive January in which sales rebounded from a drop in December, 38 percent said they expect to increase sales by more than 5 percent this year, 45 percent put sales growth at 5 percent or less, 9 percent anticipate flat results and 8 percent foresee a decline in sales.

"January sales were more in line with what we saw all last year, confirming that December was not the start of a trend," said MRA President and CEO James P. Hallan. "Despite the many challenges still out there, retailers are optimistic about their sales going forward."

The January Michigan Retail Index found that 43 percent of retailers increased sales over the same month last year, while 35 percent recorded declines and 22 percent saw no change. The results create a seasonally adjusted performance index of 57.9, up from 46.6 in December. A year ago January it was 63.8.

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, 55 percent of retailers expect sales during February - April to increase over the same period last year, while 5 percent project a decrease and 40 percent no change. That puts the seasonally adjusted outlook index at 74.7, up from 63.7 in December. A year ago January it stood at 78.

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
January 2013 results
Index figures dating to July 1994 are available at http://www.retailers.com/mra/news/michigan-retail-index.html

January 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 December results)

		% Increased		% Decreased		% No Change		Index*		Responses
Sales		43 (36)		35 (46)		22 (18)		57.9 (46.6)		78 (117)
Inventory		22 (30)		29 (29)		49 (41)		57.4 (57.8)		77 (116)
Prices		17 (25)		10 ( 9)		73 (66)		54.7 (59.9)		77 (116)
Promotions		22 (35)		4 (11)		74 (61)		62.6 (64.1)		77 (116)
Hiring		9 ( 8)		11 (11)		80 (81)		51.2 (50.7)		76 (116)

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 December results)

		% Increased		% Decreased		% No Change		Index*		Responses
Sales		55 (40)		5 (22)		40 (38)		74.7 (63.7)		78 (116)
Inventory		30 (25)		13 (26)		57 (49)		57.9 (58.5)		77 (115)
Prices		27 (25)		5 ( 7)		68 (68)		62.4 (58.2)		77 (115)
Promotions		44 (32)		4 ( 4)		52 (64)		71.2 (65.3)		77 (115)
Hiring		13 (10)		6 ( 7)		81 (83)		54.3 (53.7)		75 (114)

January 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		21 (37)		37 (10)		42 (53)
West		36 (57)		43 ( 7)		21 (36)
Central		60 (50)		20 ( 0)		20 (50)
East		80 (40)		20 ( 0)		0 (60)
Southeast		46 (65)		39 ( 4)		15 (31)

Question of the Month
What is your current projection for your percentage sales growth or decrease in 2013?

Increase more than 5%		37.7%		Decrease 5% or less		1.9%
Increase 5% or less		45.3%		Decrease more than 5%		5.7%
Same		9.4%		Overall average		6.6%

*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.