LANSING, MI -- (MARKET WIRE) -- May 23, 2007 -- Michigan retailers are cooling their early
summer sales projections.
Fewer than two in five now expect to increase sales during the next 90
days, a decline in optimism from recent months, according to the Michigan
Retail Index, a joint project of Michigan Retailers Association (MRA) and
the Federal Reserve Bank of Chicago.
The scaled-back forecasts follow a drop in sales during April.
"I believe the rapid rise in gasoline prices is having a negative effect on
sales," said one retailer who responded to the confidential survey of MRA
members.
"If it's this high now, I'm concerned about the public's planning for the
summer months. Couple that with the state of the economy and I'm very
concerned about retail sales for the next few months."
Larry Meyer, MRA chairman and CEO, said higher gasoline prices and
Michigan's higher unemployment rate in April contributed to the drop in
overall retail industry performance. He said retailers are telling him that
the sharp rise in gasoline prices is cutting into their May sales as well.
The Michigan Retail Index showed that 35 percent of retailers increased
sales in April over the same month last year, while 47 percent recorded
declines and 13 percent saw no change. The results create a seasonally
adjusted performance index of 39.7, down from 49.0, in March.
In addition, 38 percent believe their sales will increase for May-July,
while 27 percent forecast declines and 29 percent project no change. The
results create a seasonally adjusted outlook index of 49.8, down sharply
from 57.1 in March.
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
April 2007 results
Index figures dating to July 1994 are available at
www.retailers.com/news/retailindex.html
April 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 March results)
% Increased % Decreased % No Change Index* Responses
Sales 35 (43) 47 (38) 13 (15) 39.7 (49.0) 145 (146)
Inventory 27 (30) 24 (20) 39 (44) 43.2 (47.1) 137 (142)
Prices 32 (28) 8 (8) 52 (55) 56.8 (52.7) 141 (138)
Promotions 37 (35) 8 (6) 49 (51) 60.4 (60.8) 143 (140)
Hiring 9 (11) 12 (16) 67 (66) 41.7 (43.0) 134 (141)
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 March results)
% Increased % Decreased % No Change Index* Responses
Sales 38 (49) 27 (20) 29 (26) 49.8 (57.1) 143 (144)
Inventory 22 (23) 33 (28) 37 (42) 38.0 (39.3) 140 (141)
Prices 30 (23) 10 (9) 51 (57) 55.3 (48.9) 139 (135)
Promotions 29 (34) 4 (8) 57 (44) 59.6 (55.2) 138 (131)
Hiring 11 (15) 9 (13) 66 (62) 42.5 (44.0) 131 (137)
April 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 33 (22) 52 (41) 11 (29)
West 57 (63) 33 (10) 6 (27)
Central 13 (41) 64 (45) 18 (14)
East 16 (16) 50 (25) 25 (42)
Southeast 40 (36) 47 (24) 11 (36)
Contact Information: Contact:
Tom Scott
517.372.5656
Email Contact