Michigan Retailers Project Better Spring Sales

LANSING, MI -- (MARKET WIRE) -- March 28, 2007 -- Michigan retailers' spring sales forecasts improved slightly after a tough February, according to the Michigan Retail Index, a joint project of Michigan Retailers Association (MRA) and the Federal Reserve Bank of Chicago.

Retailers' three-month outlook rose by nearly a point on the Index, while the industry's February sales performance fell by 3.5 points.

"Unseasonably cold weather hurt sales by keeping some shoppers at home and discouraging others from buying spring apparel. It was the same story in Michigan as it was across the nation," said Larry Meyer, MRA chairman and CEO.

Nationwide retail sales, excluding autos, fell by 0.1 percent in February, the U.S. Commerce Department reported. It was the worst performance since last October.

The Michigan Retail Index showed that 36 percent of retailers increased sales in February over the same month last year, while 40 percent recorded declines and 18 percent saw no change. The results create a seasonally adjusted performance index of 46.9, down from 50.4 in January.

In addition, 47 percent believe their sales will increase for March-May, while 19 percent forecast declines and 28 percent project no change. The results create a seasonally adjusted outlook index of 57.7, up from 56.8 in January.

North Michigan retailers fared the best in February, with 49 percent ringing up better sales. Of the 10 MRA members from Gaylord who responded to the online survey, 72 percent reported higher sales.

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

February 2007 results

Index figures dating to July 1994 are available at www.retailers.com/news/retailindex.html

February 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 January results)

            % Increased   % Decreased  % No Change  Index*       Responses
Sales       36 (36)       40 (37)      18 (22)      46.9 (50.4)  183 (207)
Inventory   33 (25)       23 (32)      34 (31)      52.0 (45.7)  176 (193)
Prices      26 (32)       10 ( 8)      57 (50)      53.5 (56.3)  181 (197)
Promotions  24 (32)        6 (10)      59 (47)      53.8 (57.0)  173 (194)
Hiring       9 ( 9)       12 (17)      67 (62)      43.6 (40.5)  171 (191)

Retailers expecting increased, decreased or unchanged sales, inventory, prices, promotions and hiring compared to the same period a year ago

(numbers in parentheses indicate January results)

            % Increased   % Decreased  % No Change  Index*       Responses
Sales       47 (45)       19 (22)      28 (27)      57.7 (56.8)  183 (204)
Inventory   29 (29)       20 (25)      42 (35)      44.7 (42.1)  177 (194)
Prices      32 (29)        6 ( 6)      54 (55)      57.0 (55.7)  180 (197)
Promotions  37 (41)        4 ( 6)      49 (42)      59.3 (60.0)  176 (194)
Hiring      12 (15)        8 (11)      71 (61)      46.3 (43.7)  177 (189)

(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        49 (48)      36 (22)      12 (27)
West         36 (57)      36 (13)      21 (25)
Central      34 (44)      47 (12)      19 (40)
East         33 (33)      56 (11)      11 (56)
Southeast    32 (48)      46 (28)      20 (22)

Contact Information: Contact: Tom Scott 517.372.5656 Email Contact